Asia Pacifi c – Q2 2019

REPORT Savills Research Investment Quarterly Asia Pacifi c Investment Quarterly

Asia Pacifi c Network

Savills Asia Pacific Network

Asia Australia Hong Kong Taiwan Adelaide Central Taichung Brisbane Quarry Bay (3) Taipei Canberra Tsim Sha Tsui Gold Coast (2) Thailand 5 Gordon India Bangkok Lindfield Bangalore Gurgaon Vietnam 41 Melbourne Offices Notting Hill Mumbai Da nang Parramatta Hanoi Perth Ho Chi Minh City 2 Roseville Indonesia St Ives Jakarta Sunshine Coast Sydney Japan Turramurra Tokyo 3 Macau Cambodia Macau Phnom Penh * Malaysia China Johor Bahru Beijing Kuala Lumpur & New Changsha Penang ia Z Chengdu l e New Zealand a a Chongqing r Auckland t la Dalian s Christchurch n Guangzhou u

d

Haikou A

Philippines Hangzhou Makati City * Nanjing 18 Bonifacio Global City * Shanghai Offices Shenyang Shenzhen Singapore Tianjin Singapore (3) Wuhan Xiamen South Korea Xi’an Seoul Zhuhai

*Associate Office

Savills is a leading global real estate to developers, owners, tenants and organisation supported by excellent service provider listed on the London investors. negotiating skills. Savills chooses to Stock Exchange. The company, focus on a defi ned set of clients, off ering established in 1855, has a rich heritage These include consultancy services, a premium service to organisations with unrivalled growth. The company facilities management, space planning, and individuals with whom we share a now has over 600 offi ces and associates corporate real estate services, property common goal. throughout the Americas, Europe, Asia management, leasing, valuation and Pacifi c, Africa and the Middle East. sales in all key segments of commercial, Savills is synonymous with a high- residential, industrial, retail, investment quality service off ering and a premium In Asia Pacifi c, Savills has 59 regional and hotel property. brand, taking a long-term view of offi ces comprising over 25,000 staff . real estate and investing in strategic Asia Pacifi c markets include Australia, A unique combination of sector relationships. China, Hong Kong, India, Indonesia, knowledge and entrepreneurial fl air Japan, Macau, Malaysia, New Zealand, gives clients access to real estate Singapore, South Korea, Taiwan, expertise of the highest calibre. We Thailand and Viet Nam. Savills provides are regarded as an innovative-thinking a comprehensive range of advisory and professional property services

savills.com/research 2 Asia Pacifi c Investment Quarterly

Content

China (Northern) - Beijing 04 China (Northern) - Tianjin 05 China (Western) - Chengdu 06 China (Southern) - Guangzhou 07 China (Southern) - Shenzhen 08 China (Eastern) - Shanghai 09 Hong Kong 10 India 11 Indonesia 12 Japan 13 Macau 14 Malaysia 15 Philippines 16 Singapore 17 South Korea 18 Taiwan 19 Thailand 20 Viet Nam 21 Major transactions Q2 2019 22

3 Asia Pacifi c Investment Quarterly

China (Northern) - Beijing

The en-bloc investment market posted a stable performance surge of 268% quarter-on-quarter (QoQ) and 152% year- Spring Cao in Q2/2019, with a total of fi ve deals concluded for a Senior Director, Investment on-year (YoY). Total transaction area reached 178,800 sq Savills Northern China combined consideration of RMB4.28 billion. Activity was m during the quarter, up 6.3% QoQ though this was down +8610 5925 2048 scattered across multiple asset classes and included offi ce, 24.7% YoY. Total consideration reached RMB5.96 billion, [email protected] department store, hotel, development site and cloud data up 15.1% QoQ and 6.3% YoY. Average transaction prices storage centre acquisitions. Domestic buyers and sellers continued to rise by 8.3% QoQ and 41.1% YoY to RMB33,319 accounted for all deal activity during the quarter. Equity Vincent Li per sq m. Associate Director transactions were the most popular deal structure. Major New supply in the fi rst-hand strata-title retail market Research & Consultancy transactions included: +86 10 5925 2044 reached 52,100 sq m in Q2/2019, up 94% QoQ and 48.4% [email protected] • Bank of China Group Investment Limited purchased the YoY. Total transaction area reached 176,900 sq m in Grand Royal Canal C-01 Tower in Tongzhou district. Q2/2019, up 68% QoQ though this was down 15.6% YoY. The offi ce asset traded hands for a total consideration of Total consideration registered RMB4.52 billion in Q2/2019, RMB2.956 billion. up 37% QoQ, although marginally down 2.2% YoY. Average • People.cn, a state-owned news website, acquired a 100% transaction prices were down by 18.5% QoQ to RMB25,545 equity share of the Atecsys Data Center in Shunyi district per sq m, though this was up by 15.8% YoY. for a total consideration of RMB252 million. Impacted by the current urban planning policies, the • COFCO Property acquired a 49.91% equity share in new supply of commercial assets in prime districts in development site COFCO Jingxi Xiangyun Project. The Beijing will be very limited in the future. While traditional equity stake was purchased from Minmetals Land for asset classes such as the offi ce, retail and hotel markets RMB1.076 billion. will continue to remain popular investment targets, a • Landsea Green Group and Sunshine Insurance jointly lack of tradable assets will see astute investors expanding acquired a 100% equity share of Plaza Hotel from China their investment horizons and focus. It is expected that Shipbuilding Industry Co Ltd. While consideration for institutional investors will continue to shift away from the deal remains undisclosed the project is expected to be acquiring new supply to targeting the acquisition of refurbished and converted to offi ce usage. existing stock to achieve increasing rental returns and The fi rst-hand strata-title offi ce market received 175,000 improved asset values through project conversion or sq m of new supply in Q2/2019, marking a signifi cant upward refurbishment.

En-Bloc Investment Volumes, 2009 to Q2/2019

70

Q1 60

Q2 50

Q3 40

30 Q4 RMB BILLION RMB 20

10

0 2014 2015 2016 2017 2018 2019

Source Savills Research & Consultancy Major Investment Transactions, Q2/2019

PROPERTY LOCATION PRICE BUYER USAGE

Grand Royal Canal C-01 RMB2.956 bil/ Bank of China Group Tongzhou Offi ce Tower US$430 mil Investment Limited

COFCO Jingxi Xiangyun RMB1.076 bil/ Development Fangshan COFCO Property Project US$156 mil site

RMB252 mil/ Atecsys Data Center Shunyi People.cn Data Centre US$37 mil

Source Savills Research & Consultancy

savills.com/research 4 Asia Pacifi c Investment Quarterly

China (Northern) - Tianjin

Supply levels of new land in Tianjin rose by 15% quarter-on- were put to auction in May 2019. The two plots were put to Andy Chee quarter (QoQ) and 35% year-on-year (YoY) to 6.96 million market as a package with a hard fl oor price set at RMB2.55 Senior Director Savills Tianjin sq m by the end of Q2/2019. In line with the decentralisation billion and a ceiling of RMB3.53 billion. The winning bid +86 22 5830 8888 trend in the market, the majority of new land parcels went to Huayu for a total consideration of RMB2.89 billion [email protected] continued to be located in fringe and suburban areas, which and an accommodation value of RMB8,830 sq m. accounted for 59% and 19% of total new supply, respectively. • A residential plot, located in Xiqing district, was acquired The supply level in Binhai New Area spiked signifi cantly Vincent Li in June 2019. The plot covers a total area of 60,564 sq m Associate Director compared to previous quarters and accounted for 21.5% of the and is positioned for low-density residential usage with Research & Consultancy +86 10 5925 2042 total. Meanwhile, the city core area continued to see a supply a plot ratio ranging from 1:0 to 2:0. China Merchants drought, with only one plot of 95,522 sq m—which accounted [email protected] Property won the bid paying the ceiling price of RMB1.34 for 1.5% of the total—released on the market during Q2/2019. billion, refl ecting an accommodation value of RMB11,038 Total transaction volume reached 5.3 million sq m during sq m. Q2/2019. While this refl ected a 23% drop-off in buyer demand Following the trend seen in 1H/2019, the market is from the previous quarter, it should be noted that this was up expected to see robust buyer demand and consequently a signifi cant 57% YoY. Buyers displayed an even appetite for signifi cant transaction volumes in the latter half of the all locations in the city, with fringe, suburban and Binhai New year. Fringe and suburban areas will continue to receive the Area accounting for 31%, 33% and 34% of total transaction greatest allocation of new supply and, as a result, market volume, respectively. As expected, the rare allocation of prices are expected to remain largely stable, given their new supply in the city core was met with eager demand and decentralised locations. Comparatively lower pricing points was acquired during the same quarter. Plots positioned for on these plots is likely to garner increased interest from commercial or residential usage continued to represent the small- and medium-sized developers in the future. majority of transactions. Major transactions included: • Two neighbouring land plots in Haihe Education Park

Land Supply And Transactions By Area, Q1/2011 to Q2/2019

City Core Supply Suburb Supply Fringe Supply Binhai Supply City Core Transactions Suburb Transactions Fringe Transactions Binhai Transactions 10 9 8 7 6 5 4

MILLION SQM 3 2 1 0 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 2011 2012 2013 2014 2015 2016 2017 2018 2019

Source Savills Research & Consultancy

Major Investment Transactions, Q2/2019

PROPERTY LOCATION PRICE BUYER USAGE

RMB1.34 bil/ Plot 2019-08 (JXQ) Xiqing China Merchants Property Residential US$195 mil

RMB2.89 bil/ Residential and Plot 2019-062/63 (JBH) Jinnan Chongqing Huayu Group US$421 mil commercial

RMB3.60 bil/ Residential and Plot 2019-2 (JBS) Binhai Shanghai Fuyi Industrial US$524 mil commercial

China Railway RMB704.8 mil/ Plot 2018-11 (JBS) Binhai Construction Bridge Residential US$103 mil Engineering Bureau

RMB1.45 bil/ Tianjin Runsheng Residential and Plot 2019-050 (JHS) Hongqiao US$211 mil Property commercial

Source Savills Research & Consultancy

5 Asia Pacifi c Investment Quarterly

China (Western) - Chengdu

In the past few months, the Chengdu retail market’s prime stores in the prime area were located in non-Chunxi Road Suzie Qing areas. Director area rental index —which is divided into the Chunxi Road- Savills Western China Yanshikou area and other non-Chunxi Road areas—has Additionally, projects in Chunxi Road exerted a positive +86 28 8658 7418 decreased for the fi rst time since 2015. The Chunxi Road- interactive eff ect on one another. Chunxi Road is more [email protected] Yanshikou area is the prime retail area in Chengdu due to spatially concentrated, with the average walking distance its location and traditional reputation. Last year, projects in between projects only around 200 meters, an advantage as James Macdonald Chunxi Road performed well and average rent rose steadily retail projects seek to attract people and build popularity. Head of Research in the area. Non-Chunxi Road projects did not perform well The sector makeup of each project in Chunxi Road also is China +86 21 6391 6688 due to unsuccessful adjustments with vacancy rates rising quite diverse, which means projects in the area are targeted james.macdonald@ and rents falling for several quarters, which led to a slight at diff erent consumer groups, making their interaction savills.com.cn drop-off in the overall rental level in prime areas. mutually benefi cial rather than competitive. The polarisation of Chunxi Road retail projects and non- Despite the challenges stated above, there still remain Chunxi Road projects has become more and more obvious. many opportunities for projects in other prime areas to One reason is that Chunxi Road is the only pedestrian adjust themselves and stand out. Chunxi Road projects will street within a larger retail area in Chengdu. As a traditional continue to reinforce their existing strengths; for example, commercial street, it draws a large fl ow of people. When IFS projects there can introduce a fi rst store or fl agship store to and Taikoo Li opened in 2014, Chunxi Road quickly became further enhance their overall brand level or boost popularity the most popular shopping area and tourist destination. by making full use of projects’ public space to set up pop-up While more and more people are attracted to Chunxi Road, stores or theme exhibitions. Non-Chunxi Road projects non-Chunxi Road areas have cooled down. Many brands could seek to attract more consumers by introducing new withdrew from retail properties in non-Chunxi Road areas retail brands, and also may consider extending their sectors and, as a result, the vacancy rate of shopping malls in the to meet rapidly changing consumer needs that have become area rose considerably. Last year, 80% of closed department more diverse and specialised.

Retail Prime Area Rental Index, Q1/2015 to Q2/2019

Prime Area Non-Chunxi Road Chunxi Road 115

110

105

100 Q1/2015 = = 100 Q1/2015

95

90 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 2015 2016 2017 2018 2019

Source Savills Research & Consultancy

Major Investment Transactions, Q2/2019

PROPERTY LOCATION PRICE BUYER USAGE

No.139 Zhaojue Temple RMB676 mil/ Chenghua Country Garden Residential South Road US$98.1 mil

East of Heping Road, RMB1.775 bil/ Longquanyi China Resources Land Ltd Mixed-use South of Nongping Road US$257.8 mil

Chengdu Hi-tech Group 1, 2, 4, 5, 6 Dengta RMB152 mil/ High-tech Investment Group Co., Commercial Village, Shiyang Street US$22.1 mil Ltd

Source Savills Research & Consultancy

savills.com/research 6 Asia Pacifi c Investment Quarterly

China (Southern) - Guangzhou

Demand in Grade A offi ce leasing market in Guangzhou contraction among some MNCs on the Guangzhou Grade A Alvin Lau remained stable during Q2/2019 in spite of some growing offi ce property market. Managing Director, Guangzhou Deputy Managing Director, concerns over external economic factors such as the Sino- In general, offi ce leasing demand came primarily Southern China US trade dispute and their potential impact on economic from several sectors during the quarter: TMT, banking, +86 20 3665 4888 [email protected] performance at both state and local levels. biotechnology and fi ntech. In addition, some sizable A clear trend appeared in the market where, in many domestic companies focusing on the real estate business Carlby Xie circumstances, leasing demand from some large-scale were also very active in the leasing market, taking up a Head of Research American fi rms tended to be more subdued, refl ecting a more signifi cant amount of new offi ce space. This resulted in much Southern China cautious attitude towards potential changes in the economic +86 20 3665 4874 faster-than-expected market digestion in submarkets such [email protected] and business climates. Among these organisations, freezing as Pazhou—the average vacancy rate decreased noticeably headcount or postponing hiring plans were the stories most by 5.1 ppts quarter-on-quarter (QoQ) to 3.6% at the end of often heard in the market after the Chinese New Year. By Q2/2019. contrast, as business relationships and cooperation between Demand contraction from some industries, such as China and some European countries further improved, P2P, continued to have a negative impact on the asset several European MNCs showed greater interest in investing performance of notable offi ce premises within Zhujiang New in Guangzhou, with plans for expanding their offi ces in the Town, pushing landlords to review and adjust their leasing locality and thereby increasing offi ce leasing demand. strategies and become more accepting of a wider range of Compared to the mixed behaviour from overseas offi ce tenants with higher rent thresholds. As a result, take-up in occupiers, leasing demand from their domestic peers Zhujiang New Town was relatively slow, with some sizable continued to be buoyant, supported by upbeat business offi ce spaces in several prominent premises remaining growth and domestic consumption—one of the signifi cant vacant since the beginning of the year. As a result, the factors underlying China’s economic growth—as evidenced average vacancy rate of Zhujiang New Town increased by 0.1 by a number of new offi ce leases in the market during of a ppt QoQ to 4.9%. the quarter. This activity off set the impact of demand

Net Absorption By Submarket, Q2/2019 VS Q2/2018

Q2/2018 (LHS) Q2/2019 (LHS) YoY Growth (RHS) 9% 0.0

8% -0.5

7% -1.0 -1.5 6% -2.0 5% % -2.5 4% -3.0 3% -3.5

2% -4.0

1% -4.5

0% -5.0 Tianhe Bei Zhujiang New Town Yuexiu Pazhou Overall

Source Savills Research & Consultancy

Major Investment Transactions, Q2/2019

PROPERTY LOCATION PRICE BUYER USAGE

Guangzhou Jiasheng RMB2.5 bil/ Yuexiu Shimao Group Residential Project US$364.6 mil

Guangzhou Swanbay RMB2.8 bil/ Haizhu Shimao Group Residential Phase 2 US$405.5 mil

Tahoe Guangzhou Garden RMB2.3 bil/ Zengcheng Tahoe Group Residential (51% equity) US$334.1 mil

Tahoe Guangzhou Garden RMB1.3 bil/ Minmetals International Zengcheng Residential (29% equity) US$189.6 mil Trust Co., Ltd

Source Savills Research & Consultancy

7 Asia Pacifi c Investment Quarterly

China (Southern) - Shenzhen

Investment activity in the Shenzhen offi ce property market of investment inquiries and deal sourcing activities. Investing Woody Lam increased signifi cantly from 2015 to present, supported by interest in the Shenzhen offi ce property market from a wide Managing Director Southern China the following factors: growing economic momentum; the range of institutional investors rose on par with increased +86 20 3665 4777 creation of the Greater Bay Area (GBA) concept back in 2015; availability of wholly-owned investment opportunities as woody.lam@savills. the subsequent formal establishment of the GBA in 2017; and well as the further promotion of the GBA by the central com.cn the release of The Outline Development Plan for Guangdong- and local governments. However, it should be noted that Hong Kong-Macao Greater Bay Area in February 2019 as part the strong new supply pipeline, combined with the current Carlby Xie Head of Research of the policy initiatives to sustain growth in the region. During environment for tenant-favoured offi ce leases and the Southern China the period from 2015 to Q2/2019, major sales transaction expected decline in rents in the short term (1-2 years), +86 20 3665 4874 volume of offi ce properties with a minimum GFA of 10,000 has inevitably resulted in a growing concern for achieving [email protected] sq m each in Shenzhen increased by 170% compared to the growth in rents, discounting the total returns on the asset period from 2010 to 2014. Total volume rose to 1.17 million at exit. In addition, the lower rental yields in comparison sq m, with investment accounting for approximately 55.2%. with peer cities such as Beijing and Shanghai has dented Notably, the profi le of purchasers became more international the courage of institutional investors entering the market. too. Four major sales transactions were concluded by overseas Therefore, policymakers in the locality should be aware of purchasers during the period from 2015 to Q2/2019 compared and advised on the potential risks of the disequilibrium of to a vacuum of sales transactions by overseas purchasers from supply and demand as well as the excessive growth in capital 2010 to 2014. In addition, some local government agencies values which could not be suffi ciently underwritten by in Shenzhen were also active in purchasing offi ce properties rental growth, and should come out with more meaningful to attract and subsidise some preferred corporations to incentives to help with market digestion. In this regard, the settle in the locality. This strategy served as one of the key Authority of Qianhai, a dispatched agency established by initiatives for supporting and achieving the local economic the Shenzhen Municipal Government, is expected to take transformation and industry upgrade, which in turn bolstered the lead in the foreseeable future in terms of creating an purchasing demand for the local offi ce property market and attractive policy deck—covering tax rebates/exemptions, supported growth in capital values to some extent. rental subsidies, housing facilities, etc.—to entice both Although there were no major sales transactions corporations and targeted highly skilled workers to relocate announced during Q2/2019, either for en-bloc sales or sales to the area. With these being said, the Qianhai is expected with a minimum GFA of 10,000 sq m, the market continued to become one of the most important investment areas in to see some positive signs nurtured by the increased volume Shenzhen in the near term.

Shenzhen Offi ce Market En Bloc Transaction Investor & End-use Change, 2010 to Q1/2019

2010-2015 2016-Q1/2019

Investor, 25% Investor, 45%

End-user, 75% End-user, 55%

Source Savills Research & Consultancy

Major Investment Transactions, Q2/2019

PROPERTY LOCATION PRICE BUYER USAGE

RMB50 mil/ G14316-0113 Pingshan AiKang Medtech Co., Ltd Industrial USD7.44 mil

RMB25 mil/ Shenzhen KTJ Dental G14316-0114 Pingshan Industrial USD3.72 mil Laboratory Co., Ltd

Shenzhen New Industries RMB51.12 mil/ G14304-0293 Pingshan Biomedical Engineering Industrial USD7.61 mil Co., Ltd Source Shenzhen Land and Real Estate Exchange Center, Savills Research & Consultancy

savills.com/research 8 Asia Pacifi c Investment Quarterly

China (Eastern) - Shanghai

China has been buzzing with stories of the eventual arrival of version of the build-and-hold strategy by retaining control and Siu Wing Chu the REIT sector ever since the end of last year when there was generating fees through asset management. Managing Director Central China talk that REITs would make their debut in the master planned Currently, China still faces challenges relative to releasing +86 21 6391 6688 city of Xiong’an New City. More excitement followed with the REITs. The biggest one is that REITs under the current [email protected] announcement of the Shanghai STAR market tech board and taxation regime will incur a heavy tax burden which hurts the securitisation of multifamily property debt. This was all yields. In addition, China needs a specifi c REIT code to create heightened further by a report in the South China Morning an ecosystem for REITs as, according to existing laws and James Macdonald Head of Research Post claiming that GIC and Grandjoy Holdings had been regulations, the Law of PRC on Partnerships, Trust Law and China selected for a pilot programme that would allow individuals Law on Securities Investment Fund do not allow publicly traded +86 21 6391 6688 to buy shares in rent-yielding properties. funds to hold commercial properties, which is why quasi-REITs james.macdonald@ The REIT industry exists in close to 40 countries are set up as private funds. Furthermore, China’s commercial savills.com.cn throughout the world and, in many cases, the business real estate market is still driven more by capital value growth was born or grew rapidly out of fi nancial distress or crises, than by rental income; current yields are comparatively which often come hand-in-hand with high levels of debt in unattractive. Developers also prefer quasi-REITs as they would property companies that have grown rapidly in a red-hot not lose control of their properties and can continue to profi t market. Developers fi nding it diffi cult or too expensive to from potential capital value appreciation. roll over debt or further extend credit lines are faced with One potential solution to this dilemma is to launch the REIT selling assets or spinning them off into REITs. China’s real market with welfare and infrastructure projects which could be estate market has grown at an exponential rate over the last aff orded tax breaks as they serve the public good. Additionally, decade and developers have borrowed heavily to capitalise the government could initiate pilot programs in special areas on this boom and to defend or steal market share from their where special tax regimes already exist. REITs could also focus competitors. A government campaign to reduce debt levels on modern logistics facilities in coastal cities where yields are has vexed developers who are now looking at alternative higher, Grade A offi ces in fi rst-tier cities, and stabilised prime fi nancing channels. Also, as development opportunities malls that have good potential to be injected into subsequent become scarcer, less profi table and more risky, some developers REITs. Finally, educating the general public on the benefi ts of are looking to enhance and grow their asset management REITs is necessary as they will be the eventual buyers of the capabilities and change their business model to an asset-light REITs should the products eventually come to market.

China Quasi-REIT Issuance, 2014 to 2018

Amount (LHS) Quasi-REIT Products (RHS) 35 18

16 30

14 QUASI-REIT PRODUCTS 25 12

20 10

15 8 RMB BILLION RMB 6 10 4 5 2

0 0 2014 2015 2016 2017 2018

Source Research Center for Real Estate Investment Trusts, Savills Research & Consultancy

Major Investment Transactions, Q2/2019

PROPERTY LOCATION PRICE BUYER USAGE

Greenland Huangpu RMB10.57 bil/ Huangpu Brookfi eld Mixed-use Centre US$1.537 bil

RMB1.6 bil/ Greenland Rainbow Bay Hongkou Brookfi eld Retail US$232.6 mil

70% equity of Shanghai RMB1.2 bil/ Hongqiao Sincere Center Minhang CDL Mixed-use US$174.5 mil Phase2

Source Savills Research & Consultancy

9 Asia Pacifi c Investment Quarterly

Hong Kong

The local offi ce and retail investment markets had a bumpy parties. Overall though, investment sentiment is decidedly Peter Yuen ride over the fi rst half of the year. After hitting a peak in cautious and will remain so until the trade dispute is Managing Director Head of Sales early 2018, average offi ce prices are still 2.7% below that resolved and retail sales recover. We believe that prices +852 2842 4436 level even if the fi rst half of 2019 saw modest gains across will probably hold up over the next few months as limited [email protected] most districts. The retail market remains soft and prices availability and redevelopment opportunities continue continue to drift down and are now a full 35.5% below their to support the market. With weakening air and sea 2013 peak. Reasons for the slowdown are not hard to fathom Simon Smith cargo throughputs, 3PLs will bear the brunt of the trade Senior Director as US/China trade tensions remain unresolved, local interest disruption but as yet, no large-scale contractions have Head of Research +852 2842 4573 rates have started to rise and the proposed Extradition Bill taken place. and resulting unrest added to uncertainties. If these factors [email protected] The residential sales market also saw a listless second continue to play out in the third quarter of the year, we can quarter where volumes were supported heavily by expect further consolidation, with bargain hunters looking primary launches. Rising local interest rates in addition for distressed assets and potentially, some recovery in to slower economic growth and a volatile stock market volumes which were heavily hit between January and May. Equally, a reversal of some or all of these factors could cause were behind the change in sentiment. The super-luxury a year-end rally sending offi ce prices into record territory segment saw some price adjustment with both Mainland and reversing falling retail values. and local HNWIs sitting on the sidelines. Given current In the industrial market volumes were also down uncertainties, buyers were looking for bargains, but as falling cargo throughput and weak retail sales hit landlords are generally standing fi rm and are under no sentiment. Despite the headwinds, however, prices and pressure to discount. The sale of a site at Kai Tak for a price rents held their ground and vacancy rates continued below market expectations could suggest a degree more to hover at around 2% overall and 0.8% in modern caution among developers but Mainland interest remains warehouses. Government remains committed to fi rm and we expect to see further purchases of larger and encouraging redevelopment, off ering a 20% plot ratio more prime sites over the second half. relaxation which saw 10 applications from interested

Savills Hong Kong Price Indices By Sector, Q1/2003 to Q2/2019

Luxury Residential Price Mass Residential Price Grade 'A' Office Price Prime Street Shop Price Industrial Price 1,000 900 800 700 600 500 400

Q1/2003 = = 100 Q1/2003 300 200 100 0 Q1 Q3 Q1 Q3 Q1 Q3 Q1 Q3 Q1 Q3 Q1 Q3 Q1 Q3 Q1 Q3 Q1 Q3 Q1 Q3 Q1 Q3 Q1 Q3 Q1 Q3 Q1 Q3 Q1 Q3 Q1 Q3 Q1 03 04 05 06 07 08 09 10 11 12 13 14 15 16 17 18 19

Source Savills Research & Consultancy

Major Investment Transactions, Q2/2019

PROPERTY LOCATION PRICE BUYER USAGE

HK$4.75 bil/ 625 King's Road North Point Gaw Capital Offi ce US$609.0 mil

21/F-23/F, Convention HK$1.8 bil/ Wanchai TBC Offi ce Plaza Offi ce Tower US$230.8 mil

HK$780 mil/ The Parkside Tsueng Kwan O TBC Retail US$100.0 mil

HK$737 mil/ State Theatre Building North Point Orint Sea Investments Ltd Retail US$94.5 mil

Source Savills Research & Consultancy

savills.com/research 10 Asia Pacifi c Investment Quarterly

India

Indian capital markets have gone through a roller coaster fl ow of funds has become high priority. Anurag Mathur in the last one year. The supply side had been excessively There is another side to the picture as well. The PEs should Chief Executive Offi cer Savills India dependent on Non-Banking Financial Companies (NBFCs) for be able to play a key role once again. It is expected that the +91 96 500 37779 sustaining operations. Indian real estate dynamics changed domestic and foreign private capital will start bridging the [email protected] with the establishment of Real Estate Regulatory Authority gaps once more. Indian markets have witnessed a reversal (RERA) in mid-2016, as the primary source of funding, in the patterns of PE fund strategies over the years. During namely customer advances, became unviable for residential Arvind Nandan the early years of the current decade, the focus of private Managing Director developers. As PEs progressively moved away from the sector, capital had been residential developments, which changed Research & Consulting +91 22 4090 7300 NBFCs began fi lling the gaps. The other advantage with almost completely in favour of commercial developments NBFCs was relatively lower cost of funds compared to PEs. [email protected] over the last few years. This has worked well for offi ce markets However, with the unexpected and sudden sinking of in recent times. With the current crunch in residential NBFCs, led by the default from IL&FS1, a leading NBFC markets, the PEs are likely to step up their eff orts to grab the player in the third quarter of 2018, real estate capital markets opportunity in residential sector. This also means that the changed drastically. A full-scale crisis was averted by better performing developers will fi nd access to such capital, intervention from the government, but it is apt to say that the while those at the bottom-end will be compelled to undergo funding scenario has remained extremely stressed over the consolidations. Indeed, the trend has begun to manifest last 10-12 months. This persists during the second quarter of itself. Ivanhoe Cambridge, along with domestic Piramal 2019. Enterprises Limited, committed INR5 billion (approximately With the government now taking several measures to US$71.43 million) for Lodha Developers’ smart city project regulate lending environment for real estate companies, such on the outskirts of Mumbai2. Further, policy tailwinds and as changing the regulator from National Housing Bank (NHB) consumer-demand are likely to create opportunities for funds to Reserve Bank of India (RBI, the Central Bank), as well as in aff ordable housing, logistics and warehousing, built-to-core allowing a one-time partial loan-loss guarantee to banks that offi ce spaces, co-living, etc. acquire high-quality pooled assets of up to INR1,000 trillion (approximately USD14.28 trillion) from NBFCs, managing the 1 Infrastructure Leasing and Financial Services (https://en.wikipedia.org/wiki/ 2 https://www.moneycontrol.com/news/business/real-estate/piramal-ivanhoe- Infrastructure_Leasing_%26_Financial_Services cambridge-to-invest-rs-500-crore-in-lodhas-palava-city-3487401.html

PE Investments In India, 2012 to 2018

Residential Office Hospitality Retail Mixed Use / Others Industrial / Warehousing 450

400

350

300

250

200 INR BILLION 150

100

50

0 2012 2013 2014 2015 2016 2017 2018

Source Savills Research & Consultancy

Major Investment Transactions, Q2/2019*

PROPERTY LOCATION PRICE BUYER USAGE

Bandra Kurla Complex, INR2,500 cr/ One BKC Blackstone Offi ce Mumbai US$358 mil

Source Savills Research & Consultancy

11 Asia Pacifi c Investment Quarterly

Indonesia

Indonesia recently concluded what was considered the positive take-up trend continued while new supply growth Jeff rey Hong world's biggest single-day election to choose its President leveled off . We expect this dynamic to continue, thus helping President Director Savills Indonesia and Parliamentary members. Despite fears of social unrest to ease high vacancy rates in the market. In the meantime, +62 21 293 293 80 and political turmoil during the vote-counting process, the we anticipate leasing activity to remain robust—from both jeff [email protected] country’s election committee managed to resolve any disputes companies looking to expand (such as co-working space and release the result, with the incumbent President Jokowi providers and e-commerce) as well as tenants capitalising on victorious and set for a second term in offi ce. The peaceful their strong bargaining position in the current market as they Anton Sitorus Director outcome sent positive vibes through the business community renew or renegotiate. Research & Consultancy and helped to restore investor confi dence. Furthermore, we continue to see investment activities +62 21 293 293 80 During the fi rst three months of 2019 (when the election took dominated by joint ventures, mostly between new foreign [email protected] place), Indonesia posted 5.07% GDP growth. Despite slightly companies and major local developers. Japanese and lower growth compared to the previous quarter, the recent Singaporean companies have been the most active in addition fi gure affi rms the country’s economic stability despite a weak to Chinese developers. Recent deals include: a joint venture global outlook on the back of US-China trade tensions. between Sinarmas and Mitsubishi in BSD to develop another The general optimism post-election is seen as a boost for the residential project; CFLD’s new industrial estate project market to grow stronger in the coming years. Furthermore, with Samanea from Singapore; and a JV between two SOEs government eff orts to accelerate business recovery in the (Patrajasa and Wika) to develop a landmark offi ce tower in the property sector can be seen in the new tax regulation for luxury CBD. residential properties as well as the overall push to provide a On another note, the market also witnessed increased low interest rate environment. We expect to see the impact activity in the data centre sector. Following the expansion from these incentives in both sales and new launches in the of Google and Alibaba, GIC and Amazon (AWS) recently apartment market beginning in the second half of 2019. announced their plans to establish major data centres in In the offi ce sector, demand in both Jakarta CBD and outside Indonesia. Lured by the prospect of online services and CBD areas continued to grow. Driven by the expansion of e-commerce sites catering to a population of over 260 million, e-commerce and tech companies as well as co-working space this sector has developed into a fast-growing industry, which providers, CBD net take-up rebounded exponentially from its contributes to the growth of various other businesses including lowest point three years ago. During the fi rst half of 2019, the the property sector.

Jakarta CBD Annual Supply, Take-up And Vacancy, 2010 to 1H/2019

New Supply (LHS) Net Take-up (LHS) Vacancy (RHS) 700,000 30%

600,000 25%

500,000 20%

400,000 15% SQ M SQ 300,000

10% 200,000

5% 100,000

0 0% 2010 2011 2012 2013 2014 2015 2016 2017 2018 1H/2019

Source Savills Research & Consultancy

Major Investment Transactions, Q2/2019

PROPERTY LOCATION PRICE BUYER USAGE

IDR3.7 tri/ Lippo Mall Puri West Jakarta LMIR Trust Retail US$53.7 bil

IDR1.0 tri/ A development land Undisclosed Amazon Data Center US$14.5 bil

IDR20.7 bil/ A development land West Java CFLD Industrial US$300 mil

Source Savills Research & Consultancy

savills.com/research 12 Asia Pacifi c Investment Quarterly

Japan

GDP grew by an annualised 2.2% in Q1/2019, beating in March. Further, after softening to 110.99 per at the end Christian Mancini of last the quarter, JPY strengthened to 107.79 per USD CEO, Asia Pacifi c estimates, though transient factors, which are unlikely to (excl Greater China) persist into Q2/2019, were the largest contributors. The as of the end of Q2/2019. Although these concerns may be Savills Japan IMF forecasts solid growth for both 2019 and 2020 as the weighing on investment in Japanese companies, investors +81 3 6777 5150 [email protected] Olympics and easy monetary policy should encourage appear to have more confi dence in real estate: while the consumption, and the government has introduced TOPIX index rose 5.4% year to date to 1,574.5 as of the end of Tetsuya Kaneko countermeasures in preparation for the planned increase in Q2, the J-REIT index rose 10.7% to 1,938.82. Director consumption tax due in October 2019. The unemployment Investment volumes in Japan for 1H/2019 were JPY1.92 Research & Consultancy +81 3 6777 5192 rate has registered between 2.2% and 2.5% for 16 consecutive trillion according to preliminary data from Real Capital [email protected] months, recording 2.4% as of May, and core CPI has been Analytics (RCA), a decrease of 16% YoY. Despite this drop in positive for 28 consecutive months, sitting at 0.7% in May. overall transaction volumes, cap rates compressed in early The US Federal Reserve has walked back some of its 2019 and large deals are still being announced. Concerns hawkish stance, and the Bank of Japan (BOJ) has confi rmed over volatility in capital markets may have made investors it will keep monetary policy loose until 2020. Japanese somewhat nervous, but the stable, defensive nature of government bonds continue to trade at negative yields. Japanese real estate remains attractive, despite relatively Purchases of J-REIT units by the BOJ picked up somewhat in high valuations. Q2/2019, rising from JPY9.6 billion to JPY14.4 billion, though Average Grade A offi ce rents in the central fi ve wards the total for 1H/2019 is still well below that of 1H/2018, which (C5W) of Tokyo grew to JPY36,100 per tsubo, up 2.4% QoQ came in at JPY37.2 billion. and 7.3% YoY. The average vacancy rate in the C5W was An Asahi Shimbun semi-annual survey of 100 major 0.3%, 0.1ppts tighter QoQ and 0.5ppts tighter YoY. Although companies revealed that nearly 60% felt the economy was domestic business sentiment is tepid, global macroeconomic at a standstill, up from just under a third only six months risks seem unlikely to infl uence the offi ce market over the ago, with most companies citing the US-China trade confl ict short term, as pre-leasing demand is sound out to 2020 and as a concern. The Tankan survey of large manufacturers vacancy remains extremely low as tenants compete for what confi rmed this sentiment, dropping to +7 in June from +12 limited space is available.

Property Transactions By Sector, 2007 to 1H/2019*

Office Logistics Retail Hospitality Residential Other 8

7

6

5

4

TRILLION YEN 3

2

1

0 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 1H/2019

Source RCA, Savills Research & Consultancy *1H/2019 volume is preliminary and tends to be lower than the fi nalised amount.

Major Investment Transactions, Q2/2019

PROPERTY LOCATION PRICE BUYER USAGE

Kyotanabe, JPY35.8 bil/ Prologis Park Kyotanabe Nippon Prologis REIT Logistics Kyoto US$315 mil

Shinagawa, JPY30.0 bil/ Undislosed DNP Gotanda Building Offi ce Tokyo US$260 mil (Domestic Company)

Akasaka Garden City Minato, JPY28.7 bil/ Sekisui House REIT Offi ce (65%) Tokyo US$250 mil

Royal Parks Tower Arakawa, JPY27.7 bil/ Undisclosed Residential Minami-Senju Tokyo US$240 mil (Domestic SPC)

Hulic Toyosu Prime Koto, JPY21.0 bil/ Global One REIT Offi ce Square Tokyo US$184 mil

Source Nikkei RE, RCA, Savills Research & Consultancy

13 Asia Pacifi c Investment Quarterly

Macau

According to the latest research from Savills Macau, in status. The recent repeal of the government’ right to terminate Franco Liu Q2 the vacancy rate in Macau’s major offi ce buildings was subsidies for off shore companies has a transition period Managing Director Savills Macau approximately 8.1%, slightly higher than Macau’s overall until the end of 2020. According to the Macau government, +853 2878 0623 residential vacancy rate but lower than its overall retail vacancy there were over 350 off shore companies in Macau with over fl [email protected] rate. Over 70% of the vacant offi ce units are single units 1,700 employees. More than 15 off shore companies applied for with a GFA of approximately 1,000 sq ft, suitable mostly for company cancellation, or indicated they planned to do so, in the small companies to lease and seldom off ered for sale. Macau’s month following the new law’s implementation. Cindy Liu Senior Director and supply of offi ce units is relatively scattered, with only a small As a consequence, many offi ce units rented by those off shore Head of Valuation (Macau) proportion of units available for large enterprises. Large companies are forecast to be released within the transition +853 2878 0623 enterprises are more likely to purchase offi ces for their own use period. According to Savills Macau research, there are [email protected] than are most small companies. over 200,000 sq ft GFA of offi ce units occupied by off shore Grade A offi ce buildings, including FIT, FBC and AIA, off er companies, mostly single and small units with an average GFA units which are relatively large with a rental range of MOP30- of 900 sq ft. These units are predicted to be released onto the MOP35 per sq ft, excluding management fees, higher than the market thus increasing the supply of small units. Macau average and usually applied only by stable and long- Meanwhile, a new form of offi ce rental which has emerged in standing large enterprises. Therefore, owners are keen to let recent years has become a strong competitor to the traditional units and maintain occupancy at relatively high levels, while offi ce market especially for small or start-up companies. receiving rental income and preserving their ability to sell when According to our research, more than 10 serviced or shared- the market rises. Negatively aff ected by the overall economic offi ce providers in Macau, mainly located in major business environment, the transaction amount of offi ce units has zones, off er small offi ce units from 50 to 400 sq ft, some open dropped in recent years while transaction prices are relatively plan. The units are furnished well with offi ce equipment, and stable, with one major cause the scarcity of offi ce units for sale. off er administrative support and fl exible rental periods, gaining In December 2018, Macau’s legislative council approved market share by satisfying the demands of small business the repeal of the Legal Regime of the Off shore Service Law, owners and providing benefi ts unavailable in the traditional which had allowed the Macau government to terminate all market. The trend appears likely to continue in the coming subsidies provided to off shore companies, including tax-exempt years.

Macau Offi ce Transaction Amount and Average Unit Price, Q1/2012 to Q1/2019

Average Transaction Unit Price (LHS) Transaction Amount (RHS) 20,000 3,000

18,000 2,500 16,000

14,000 2,000 MOP MILLIONMOP 12,000

10,000 1,500

8,000 1,000 MOP PER SQ FT 6,000

4,000 500 2,000

0 0 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 2012 2013 2014 2015 2016 2017 2018 2019

Source DSEC, Savills Macau

savills.com/research 14 Asia Pacifi c Investment Quarterly

Malaysia

Market sentiment appears to be gradually improving after active in the Malaysian logistics market, building on its Datuk Christopher Boyd a muted start to 2019. While total transaction value is up by earlier Q4/2018 acquisition of a 39-acre industrial site. In Executive Chairman Savills Malaysia 27% over the previous quarter, the year-on-year (YoY) value this quarter Mapletree, through its wholly owned subsidiary + 603 2092 5955 ext 149 is lower than 2018, measuring a -28% decrease. We attribute Symphony Warehouse Sdn Bhd, acquired a 15.2-acre factory [email protected] this to higher-than-expected transactions during 2Q/2018 and warehouse facility from Advance Synergy Bhd for a total when parties rushed to close certain deals before the new consideration of RM124 million. Nabeel Hussain government came into power. On an administrative front, the Pakatan Harapan Senior Director Land-banking activities in the Central and Northern coalition government announced several key initiatives this Capital Markets regions led activity this quarter. Scientex Group, a plastics quarter. In line with its election manifesto, a formal bid has Savills Malaysia +603 2092 5955 ext 126 manufacturer that has diversifi ed into aff ordable home been launched to take over the highway toll concessions [email protected] development, acquired a combined 317 acres of land in for four major arterial expressways in the Klang Valley. Selangor and 180 acres in Penang for considerations of Two mega-projects, the East Coast Rail Line (linking the RM234 million and RM110 million respectively through major cities on the east of the peninsula to Port Klang), and wholly owned subsidiaries. Penang was particularly active Bandar Malaysia (potentially the largest master-planned this quarter, with two local developers standing out: Aspen development ever in Kuala Lumpur) have recently been Vision, a joint-venture company between Aspen Group restarted after lengthy negotiations with stakeholders to Holdings and Oxley Holdings, acquired seven parcels of reduce cost levels. Looking forward, it does appear that freehold land for a total consideration of RM165 million, development will continue to play a signifi cant role in the while Tambun Indah purchased 27 parcels of land totalling administration’s strategy to steer the domestic economy. 210 acres for an aggregate consideration of RM131 million. Local investors view this as good news, since these In the East Coast Region, Far East Holdings Bhd acquired government-backed projects will spur construction activity, a 5,250-acre palm estate in Pahang, inclusive of an on-site a major component (5%) of Malaysia’s GDP. We envisage mill, from Harn Len Corporation Bhd. transactional activity picking up through the remainder of Mapletree and its related companies continues to be the year as confi dence continues to build.

Malaysia GDP Growth, 2008 to 2019F

8% 7.4% 7% 6.0% 5.9% 6% 5.6%

5% 5.1% 4.8% 5.2% 4.5% 4.6% 4.7% 4.7% 4% 4.2%

3%

2%

1%

0%

-1% -1.5% -2% 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 Q1/2019 2019F

Source Bank Negara

Major Investment Transactions, Q2/2019

PROPERTY LOCATION PRICE BUYER USAGE

15.2-acre Industrial land RM124 mil/ Selangor Mapletree Investments Industrial & warehouse US$30.13 mil

167-acre RM123.3 mil/ Selangor Scientex Group Development land development site US$29.95 mil

150-acre RM111.2 mil/ Selangor Scientex Group Development land development site US$27.02 mil

29-acre RM165.0 mil/ Aspen Group Holdings, Penang Development land development site US$40.09 mil Oxley Holdings

210-acre RM131.0 mil/ Penang Tambun Indah Land Development land development site US$31.83 mil

5,250-acre RM183.0 mil/ Pahang Far East Holdings Bhd Farmland agriculture site US$44.46 mil

Source Company announcements, Savills Research & Consultancy

15 Asia Pacifi c Investment Quarterly

Philippines

The Philippine tourism industry ranked third among the and construction contracts. Infused capital from China Michael McCullough country’s best performing sectors in 2018, after miscellaneous amounted to USD198.7 million last year, more than fi ve times Managing Director KMC Savills, Inc services and semiconductors. It accounted for 12.7% of gross higher than the previous year. In Q2/2019, International +632 217 1730 domestic product (GDP), amounting to PHP2.2 trillion Entertainment Corporation (IEC) acquired a minority share [email protected] in nominal terms. Given the outstanding performance of of New World Bay Hotel and Casino and its neighbouring tourism as well as its potential to generate employment, residential apartment complex located in downtown Manila. Fredrick Rara the sector has become one of the government‘s priority The company is taking advantage of the steady growth of the Research Manager development areas, off ering numerous local and foreign tourism industry and the booming gaming business in the KMC Savills, Inc investment opportunities. country. +632 403 5519 fredrick.rara@ Foreign arrivals in Q1/2019 reached a total of 2.2 million While the off shore and outsourcing (O&O) sector is still kmcmaggroup.com visitors, posting a 7.6% growth year-on-year (YoY). Korea largely driving the offi ce market, POGOs are becoming a continues to be the largest source market with around 519,600 key player—taking up about half of new offi ce supply in the Korean tourist arrivals in the quarter. Although China came Bay Area in 2018. In conjunction with the infl ux of Chinese in second at about 463,800 visitors, it tracked the highest YoY workers, demand for residential space surged alongside growth rate at 24.9%. The infl ux of Chinese visitors is mainly a stream of new residential developments in areas where attributed to the warmer ties between the Philippines and POGOs operate. We still consider the POGO sector as a wild China. This relationship has in turn opened up opportunities card in the property space given the risk of a China clamp- for Chinese gaming fi rms to capitalise on the country’s liberal down. However, developers are making the most of what the gaming environment, hence the recent increase in the number sector can off er as it has been a critical component of the of Philippine Off shore Gaming Operators (POGO). In this country’s drive for increased tourist arrivals. Nonetheless, regard, the Bay Area remains a favoured location for operators, we believe demand in the property sector will remain in high with its clustering of integrated casinos and resorts. gear for the coming quarters despite headwinds (e.g. trade The improved government relations with China have tensions) along the way. also resulted in a strong pick-up in Chinese investments

Tourist Arrival Growth And Tourism Share To GDP, 2013 to 2018

Others USA China Korea Share to GDP (RHS) 7,000 14%

6,000 12%

5,000 10%

4,000 8%

3,000 6%

2,000 4% TOURIST ARRIVAL ('000) ARRIVAL TOURIST 1,000 2%

0 0% 2013 2014 2015 2016 2017 2018

Source Savills Research & Consultancy

Major Investment Transactions, Q2/2019

PROPERTY LOCATION PRICE BUYER USAGE

Marina Residential 1588 M M H Del Pilar St - Apartment Suites Malate, Manila International Romero Salas St Brgy Lot 4-A & 4-B, Blk 362 -DevelopmentEntertainment site 668 Zone 072, Manila Corporation New World Manila Bay 1588 M M H Del Pilar St -Hotel Hotel Malate, Manila

Source Savills Research & Consultancy

savills.com/research 16 Asia Pacifi c Investment Quarterly

Singapore

Real estate investment sales rose 49.0% quarter-on-quarter transactions recorded in Q2; the purchase of Chinatown Christopher J Marriott (QoQ) to S$7.25 billion in the second quarter of 2019. The Point Mall at S$520.0 million by a joint venture between CEO Southeast Asia strong showing was mainly due to the commercial property Mitsubishi Estate Co. and CLSA, along with Frasers +65 6415 3888 sector which contributed S$3.84 billion or nearly 53.0% of Centrepoint Trust’s S$433.3 million acquisition of a one- [email protected] Q2’s total investment sales. third stake in Waterway Point at Punggol. In recent months, the market has been witnessing the Another bright spot in Q2/2019 was luxury non-landed Alan Cheong eff orts of institutional investors, private equity funds or private properties. A total of 34 condominium and Executive Director corporate entities, to deploy capital into the Singapore offi ce apartment units (each worth at least S$10 million) found Research market. Therefore, after a relatively quiet Q1, a few big-ticket +65 6415 3641 buyers in the reviewed quarter, the highest quarterly number [email protected] offi ce block transactions were concluded in the April-June since Q3/2008. Among these, 29 units were priced above quarter. The largest deal was AEW Asia’s S$1.025 billion S$3,000 per sq ft (psf), the minimum price for what we acquisition of Chevron House, a 32-storey commercial term “super-luxury”. The most expensive sale was for the development at Raffl es Place comprising 27 levels of offi ce 21,108-sq ft triplex super penthouse at Wallich Residence space and a fi ve-storey retail podium. The second-biggest in Tanjong Pagar. This penthouse, the largest in Singapore, transaction was for Frasers Tower, a newly completed was acquired by billionaire inventor Sir James Dyson for 38-storey premium Grade A offi ce development with a three- S$73.8 million, or S$3,496 psf of strata area. A check of storey adjacent retail podium at Cecil Street. A 50% interest URA’s statistics for buyers’ nationality, as well as ground in the property, which is worth S$982.5 million based on the information from agents, suggested that there is a strong agreed property value, was divested by Frasers Property to return of foreign buyers (including permanent residents), South Korea’s National Pension Services. Other major deals especially those from China, in the super-luxury segment. include the S$395.0 million sale of 7 & 9 Tampines Grange Non-landed residential units with high absolute prices in and the collective sales of Realty Centre for S$148.0 million. the Core Central Region (CCR) have seen a predominance of In the retail sector, there were also two major block Chinese buyers.

Investment Sales Transaction Volumes By Property Type, Q2/2019

Hospitality S$0.36 bil, 5%

Commercial S$3.84 bil, 53% Industrial S$0.62 bil, 9%

Mixed S$0.61 bil, 8%

Residential S$1.84 bil, 25%

Source Savills Research & Consultancy

Major Investment Transactions, Q2/2019

PROPERTY LOCATION PRICE BUYER USAGE

S$1.025 bil/ Chevron House Raffl es Place AEW Asia Commercial US$754.5 mil

Frasers Tower S$982.5 mil/ South Korea's National Cecil Street Commercial (50% interest) US$723.2 mil Pension Services

Chinatown Point Mall A joint venture between S$520.0 mil/ and four strata offi ce New Bridge Road Mitsubishi Estate Co and Commercial US$382.8 mil units above the mall CLSA

S$492.0 mil/ Wingcharm Investment Government land Middle Road Residential US$362.1 mil Pte Ltd

Marina Square retail and Raffl es Boulevard and S$485.3 mil/ United Industrial commercial complex Commercial and hotel Raffl es Avenue US$357.2 mil Corporation Limited (24.27% interest) Source Savills Research & Consultancy

17 Asia Pacifi c Investment Quarterly

South Korea

Total volumes for the fi rst half of this year were recorded at GI. The transaction concluded with a CBD unit price of Crystal Lee KRW6.65 trillion, exceeding the KRW6.1 trillion fi gure posted KRW29.1mil/3.3sqm, despite the large-scale vacancies caused CEO Savills Korea in 2018 for the same period when annual total investment by the relocation of law fi rm Shin & Kim to D Tower in the fi rst +82 2 2124 4163 volume hit a record high. Despite concerns about a slowdown quarter. KIC, a tenant in STN, and a blind fund from Korea Post [email protected] in the economy, the transaction volume for Q2/2019 stood at are known to be the major equity holders. Mirae Asset Daewoo KRW4.6 trillion, thanks to abundant liquidity and low interest was reported to underwrite the remainder. rates. In GBD, recent sales concluded only after the buildings’ JoAnn Hong Director Transactions were especially active in YBD, where fi ve deals vacancy rates were stabilised through securing coworking Research & Consultancy closed in this quarter and four more deals are scheduled to offi ces as anchor tenants. After securing WeWork on all fl oors, +82 2 2124 4182 close soon. Sellers are offl oading their assets to hedge against Tong Yang AMC disposed of Mitta Tower for KRW120 billion [email protected] uncertainty and improve capital effi ciency, for example through (KRW26.3mil/3.3sqm) in a sale to Shinhan REITs Management. the sale of the headquarters of fi nancial services fi rms, while Shinhan Capital and Shinhan Bank participated in the deal as others are selling before the expected completion in 2020 of equity investors with the public funding partial amounts. several large-scale projects including Parc.1, Yeouido Post Recent reports indicate that an asset in GBD transacted Offi ce and KB Finance Town. On the other hand, investors are at under 4%. The average fi ve-year treasury yield in Q2/2019 acquiring assets with plans to improve profi tability by altering decreased to 1.7%, indicating a prime offi ce cap-rate spread of use to retail or accommodation, especially in places where costs approximately 290 bps. Typical LTV rates in Korea remained at are low relative to other districts or there is demand to use the approximately 55%. The Bank of Korea lowered its base rate by acquisition as company headquarters. 25 bps to 1.5% on July 18th 2019. This was the fi rst adjustment In CBD, the total transaction volume for Q2/2019 was of the benchmark rate since November last year and the bank’s KRW2.4 trillion, including the newly completed Eulji Twin fi rst rate cut in three years. The move came amid eff orts to spur Tower (formerly Summit Tower), Jongno Tower, T Tower, and economic growth on the back of rising global uncertainties Citibank’s Dadong headquarters. Mirae Asset AMC acquired which follow a trade dispute with Japan and the ongoing tariff State Tower Namsan (STN) for KRW588.6 billion from CBRE war between US and China.

Offi ce Transaction Volumes, 2010 to Q2/2019

12 Q1

10 Q2

Q3 8 Q4 6

KRW TRILLION 4

2

0 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019

Source Savills Korea

Major Investment Transactions, Q2/2019

PROPERTY LOCATION PRICE BUYER USAGE

KRW588.6 bil/ State Tower Namsan CBD Mirae Asset AMC US$504.8 mil

KRW463.7 bil/ Jongno Tower CBD KB AMC US$397.7 mil

Eulji Twin Tower KRW857.9 bil/ KT AMC (West), CBD (formerly Summit Tower) US$735.8 mil BC Card (East) Offi ce Samsung Life Insurance KRW233.2 bil/ Saengbo Real Estate GBD Samseong-dong Building US$200.0 mil Trust

WeWork Tower KRW120.1 bil/ Shinhan REITs GBD (formerly Mitta Tower) US$103.0 mil Management

KRW232.2 bil/ Keppel Investment Yeouido Finance Tower YBD US$199.2 mil Management

Source Savills Korea

savills.com/research 18 Asia Pacifi c Investment Quarterly

Taiwan

Investment sentiment continued to improve this year, with price of NT$1.53 million per ping and 1.58 million per ping, Ricky Huang total transaction volumes in the fi rst half of 2019 increasing by respectively, both of which did not exceed the previous price General Manager Savills Taiwan 6.9% year-on-year (YoY) to NT$52.9 billion. Purchase demand level set in 2015. Both deals were concluded by investment +886 2 8789 5828 was active across the offi ce, factory and industrial offi ce asset institutes that are looking for stable income, with yields of [email protected] classes, especially in the offi ce sector, which accounted for around 2.3% to 2.4%, and value appreciation opportunities in 37% of total transaction in 1H/2019 and witnessed signifi cant the future. demand from both end-users and investors. Developers noticed opportunities in the offi ce sector Erin Ting Director Three out of the fi ve largest transactions in 1H/2019 fell and enlarged their industrial and commercial land banks Research in the offi ce sector. The largest deal was concluded by IBF aggressively. In the fi rst six months, total land volumes +886 2 8789 5828 Financial Holding which acquired 6,000 ping of offi ce space acquired by developers for commercial property development, [email protected] in HuaKu Asia Landmark, a pre-sale offi ce project in Taipei especially for offi ce and industrial offi ce use, totalled NT$36.1 City, for a total of NT$5.67 billion, equivalent to NT$850,000 billion, signifi cantly higher than the NT$13.1 billion seen in per ping. IBF Financial Holding will schedule a move into the whole last year. this new headquarters in 2020. Rising demand from offi ce Industrial sites in the fringe areas of Taipei City and New end-users has stimulated investors’ interest as well. Taian Taipei City are currently on the radar for developers. Several Insurance purchased 5,630 ping of strata Grade B offi ces for developers, including Highwealth, Farglory, and Chong Hong, NT$3.77 billion, writing down its fi rst property investment have announced plans to enhance investment in the offi ce over NT$300 million since then, with the yield ranging sector. between 2.4% and 2.5%. The outlook for the offi ce market is generally positive for The rebounding transaction activity didn’t result in a quick the next two to three years. Limited new supply coupled with price rise, however. Several public offi ce tenders witnessed the growing trend of urban revitalisation and aggressive less than a 1% of premium over reserve prices. In Q2, two expansion of co-working brands should provide a strong deals occurred in President International Tower, a Grade foundation to offi ce prices and rental growth in the short- to A offi ce building in Xinyi district, which recorded a unit medium-term.

Signifi cant Transactions By Sector, 2010 to 1H/2019

Retail Factory Industrial Office Office Hotel Other 140

120

100

80

60 NT$ BILLION NT$

40

20

0 2010 2011 2012 2013 2014 2015 2016 2017 2018 1H/2019

Source Savills Research & Consultancy

Major Investment Transactions, Q2/2019

PROPERTY LOCATION PRICE BUYER USAGE

3F-10F & 17F, NT$5.67 bil/ Taipei City IBF Financial Holding Offi ce HuaKu Asia Landmark US$183 mil

Kenmec Mechanical NT$2.57 bil/ Engineering Zhongli Taoyuan City Delta Electronics Factory US$83 mil Factory V building, Phase NT$3.69 bil/ Novatek Microelectronics Eight, Tai Yuen Hi-Tech Hsinchu City Industrial offi ce US$119 mil Corp Industrial Park

Changchun Financial NT$3.76 bil/ Taipei City Taian Insurance Offi ce Building US$121 mil

Source Savills Research & Consultancy

19 Asia Pacifi c Investment Quarterly

Thailand

The second quarter witnessed notable transactions across disappointment at fi rst quarter fi gures, which recorded a Robert Collins Thailand’s hospitality sector, with largely Bangkok-based moderate 1.75 % increase year-on-year. CEO Savills Thailand schemes drawing investment spurred by healthy hotel market Bangkok’s commercial property sector remained active +66 2636 0300 fundamentals and long-term sector confi dence. over Q2, with transactions taking place relating to several [email protected] Shangri-La acquired a 2,630 sq m site on Sukhumvit 55, in high profi le planned projects. Sino-Thai Engineering & Bangkok’s popular Thonglor district, announcing plans to Construction PLC (STECON) completed the purchase of develop a new hotel under their upscale ‘Jen’ brand. The plot an 11 rai (17,600 sq m) development site near Mo Chit BTS Chris Hobden was reportedly purchased from Sriview International for around station from U City PLC for THB4.3 billion (US$138.7 milion). Associate Director Research & Consultancy US$60 million (THB1.9 billion), representing the highest price STECON plans to redevelop the site into an offi ce-focused +66 2636 0300 achieved for Bangkok hotel development land on a per square complex, comprising 36 storeys across two towers. [email protected] metre basis. SET-listed Singha Estate completed the THB5.7 billion SET-listed property investment fi rm U City, a subsidiary (US$183.6 million) sale of Grade B offi ce complex, Sun of BTS Group Holdings, released plans to spend THB3 billion Towers, to S Prime Growth Leasehold Real Estate Investment (US$97.1 million) redeveloping the Old Customs House on Trust (SPRIME), its sponsored REIT. Bangkok’s Chao Phraya riverbank. Planned improvements In May, Raimon Land and Japan’s Mitsubishi Estate include extensive restoration of the original 130-year-old building Group released plans to jointly develop One City Centre, a and a new accommodation wing, with overall completion of the new Grade A offi ce building due to comprise 65,000 sq m of hotel-focused scheme due by 2025. leasable space and slated for completion by 2023. The scheme Dusit Thani acquired 97 units within Anantara Baan represents Mitsubishi’s fi rst Bangkok-based non-residential Rajprasong, rebranding the overall building as Dusit joint venture, with the fi rm having previously undertaken Suites Hotel Ratchadamri, becoming the group’s fi rst all- a series of condominium projects in conjunction with suite property. Dusit Thani has further highlighted their prominent residential developer AP (Thailand) PLC. intentions to increase the group’s international holdings, While there remains interest from international developers with 2-3 European acquisitions reportedly currently under in forging new residential joint ventures, we expect concerns consideration. surrounding weakening condominium sales, coupled with tighter Although overall tourist arrivals are broadly forecast to mortgage controls taking eff ect over the second quarter, to surpass 40 million over 2019, authorities have expressed reduce the volume of residential project investment over 2019.

Thailand Total Tourist Arrivals, 2003 to 2019F

Total Arrivals (LHS) % Change Y-0-Y (RHS) 45 25%

40 20% 35 15% 30

25 10%

20

MILLION 5%

15 0% 10 -5% 5

0 -10% 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019F

Source Ministry of Tourism and Sports (Thailand), Savills Research & Consultancy

Major Investment Transactions, Q2/2019

PROPERTY LOCATION PRICE BUYER USAGE

A 2,630 sq m THB1.852 bil/ development site – Bangkok Shangri-La Hotel US$60.0 mil Planned Hotel Jan

Old Customs House, THB1.608 bil/ Mixed-use - Bangkok U City Bangrak US$52.0 mil hotel focused

Anantara Baan THB721.5 mil/ Bangkok Dusit Thani Hotel Rajprasong (97 units) US$23.3 mil

A development site THB4.212 bil/ Mixed-use - – Planned Mo Chit Bangkok STECON US$136.2 mil commercial Complex Source Company announcements, Savills Research & Consultancy

savills.com/research 20 Asia Pacifi c Investment Quarterly

Vietnam

The second quarter ended positively with the June 30th between overseas businesses and leading local companies. Neil MacGregor signing of the European-Vietnam Free Trade Agreement In May, South Korea’s SK Group acquired a 6.1% stake Managing Director Savills Vietnam (EVFTA) and the European-Vietnam Investment in Vingroup for US$1 billion. Through this strategic +84 8 3823 7454 Protection Agreement (EVIPA). The EVFTA is expected to partnership, SK Group expanded its foot print in Vietnam [email protected] boost exports to the EU by 20% by 2020 and see 99.2% of and will be investing in new businesses and infrastructure import tariff s gradually removed over the next seven years. development. In the same month, local developer Phat Troy Griffi ths With this agreement, Vietnam gains market access to 28 Dat announced an investment partnership with Samty Deputy Managing Director member countries of the EU and greater integration into Corporation of Japan. The new venture will see Phat Dat Advisory Services global markets. funded up to US$22.5 million to develop real estate projects +84 8 3823 9205 tgriffi [email protected] A GDP growth rate of 6.76% year-on-year (YoY) signaled in Vietnam. a strong fi rst half to the year. FDI disbursement increased Following a new high of 15.5 million international nearly 8% while the industrial market anticipated further arrivals in 2018, the fi rst half of 2019 welcomed growth. In early 2019, Hong Kong-based Gaw Capital approximately 8.5 million foreign visitors, up 7.5% YoY. As Partners and local company NP Capital Partners reached hospitality demand increases, investor interest does too. an agreement to launch Gaw NP Industrial, a joint logistics In April, local developer Crystal Bay Group broke ground and industrial investment entity. The US$200-million on the Sunbay Park Hotel & Resort project in Ninh Thuan, platform will strive to capture increasing demand across central Vietnam. The US$190-million project is the fi rst the country for high-quality logistics warehouses, ready- to implement the ‘Apart-Hotel’ model, an alternative built-factories and built-to-suit facilities in key cities and accommodation approach off ering private apartments industrial clusters. Geleximco recently partnered with ITC supported by hotel level services and amenities. Further Corporation to propose development of a US$1.3 billion south, local developer NovaLand is making moves in the seaport and logistics center in Cai Mep, Ba Ria Vung Tau vacation home market and aims to capture interest in in southern Vietnam. The project aims to expand capacity tourism-linked real estate investment products with the and streamline international shipment services. announcement of the 1000-ha NovaWorld Phan Thiet. In Q2/2019, capital markets saw increased M&A activity

International Visitors To Vietnam By Nationality, 2015 to 1H/2019

Russia United States Taiwan Japan Korea China Others 18

16

14

12

10

8 MILLIONS 6

4

2

0 2015 2016 2017 2018 1H/2019

Source General Statistics Offi ce of Vietnam

Major Investment Transactions, Q2/2019

PROPERTY LOCATION PRICE BUYER USAGE

VND561.68 bil/ Land at Lien Chieu Da Nang Maxtrix Holdings Ltd Industrial US$24.2 mil

Hoa Khanh Tay Water VND232.10 bil/ Plant & Duc Hoa III Water Long An Rohas Tecnic Berhad Industrial US$10 million Plant (40% interest) Source Savills Research & Consultancy

21 Major Transactions Q2/2019

Australia

◄ Westfi eld Burwood (50%) Zenith Centre ► Burwood, NSW Chatswood, NSW AU$575M/US$404.54M AU$438.18M/US$308.26M in May in June

80 Collins Street ► Melbourne, VIC AU$1.476B/US$1.038M in May

◄ MLC Centre (50%) Sydney, NSW AU$800M/US$562.68M in April ▲ 737 Bourke Street ▲ 201 Charlotte Street Docklands, VIC Brisbane, QLD AU$192M/US$135.07M AU$126.7M/US$89.12M in May in May

Rockdale Plaza ► ◄ Makerston House Rockdale, NSW Brisbane, QLD AU$142M/US$99.87M AU$103M/US$72.45M in Apr in May

Beijing/Guangzhou

Atecsys Data Center ► Grand Royal Canal C-01 ► Shunyi, Beijing Tongzhou, Beijing RMB250M/US$37M RMB2.96B/US$430M in April in April

◄ Anzhen Hualian Mall ◄ Plaza Hotel Chaoyang, Beijing Chaoyang, Beijing in May RMB730M/US$106M in May

Westmin Plaza ► COFCO Jingxi Xiangyun Project ► Zhongshan, Guangzhou Fangshan, Beijing RMB910M/US$132M RMB1.076B/US$156M in Q2 in June

savills.com/research 22 Major Transactions Q2/2019

Shanghai

Belvedere Serviced Apartment ► Changning RMB1.624B/US$236M in Q2

◄ International Metropolis Plaza Building 4 Pudong RMB400M/US$58M Greenland Huangpu Center ▲ in Q2 Huangpu RMB10.57B/US$1.537B Caohejing Pujiang Hi-Tech Center in Q2 (Block No. 21) ▼ Minhang ◄ Hongqiao Innovation Center (Zpark) RMB483M/US$70M Changning in Q2 RMB450M/US$65M in Q2 ▲ Hexing Building Putuo RMB805M/US$117M Xingxing Building in Q2 (Oriental Enterpirse Center) ► Jing'an RMB368M/US$54M in Q2

Hong Kong

Convention Plaza Offi ce Tower (3 fl oors, 21/F-23/F) ► Wanchai HK$1.8B/US$230.8M in April

◄ 625 King's Road North Point HK$4.75 B/US$609.0M State Theatre Building ▲ in May North Point HK$737M/US$94.5M in June

23 Major Transactions Q2/2019

Japan

◄ Akasaka Garden City (65%) Minato, Tokyo JPY28.7B/US$250M in May

Royal Parks Tower Minami-Senju ► Arakawa, Tokyo JPY27.7B/US$240M in May

Malaysia

◄ 210-acre development site Seberang Perai, Penang RM130M/US$31.83M in April

29-acre development site ► Paya Terubong, Penang Advance Synergy Factory ▲ RM165M/US$40.09M Shah Alam, Selangor in June RM124M/US$30.13M in June

Singapore

Chevron House ▼ ▼ Frasers Tower (50% interest) 30 Raffl es Place 182 Cecil Street S$1.025B/US$754.5M S$982.5M/US$723.2M in April in June

Marina Square retail and ▲ Chinatown Point Mall commercial complex 133 New Bridge Road (24.27% stake)▲ S$520.0M/US$382.8M River Valley Road in April S$485.3M/US$357.2M in April

savills.com/research 24 Major Transactions Q2/2019

South Korea

◄ Jongno Tower Eulji Twin Tower CBD (formerly Summit Tower) ► KRW463.7B/US$397.7M CBD in June KRW857.9B/US$735.8M in June

◄ Samsung Life Insurance Samseong-dong Building GBD KRW233.2B/US$200M ▲ State Tower Namsan in June CBD KRW588.6B/US$504.8M WeWork Tower in April (formerly Mitta Tower) ► GBD ◄ Yeouido Finance Tower KRW120.1B/US$103M YBD in May KRW232.2B/US$199.2M in May

Taiwan

◄ Huaka Asia Landmark Kenmec Mechanical Taipei City Engineering Zhongli Factory ► TWD5.67B/US$183M Taoyuan City in May TWD2.57B/US$83M in April Changchun Financial Building ► Taipei City TWD3.76B/US$121M in April

25 Asia Pacifi c Investment Quarterly

NOTES PAGE

savills.com/research 26 Savills Regional Investment Advisory, Asia Pacifi c

Regional Investment Advisory Regional Research and Consultancy Frank Marriott Simon Smith Email: [email protected] Email: [email protected] Tel: +852 2842 4475 Tel: +852 2842 4573 23/F, Two Exchange Square, Central, Hong Kong 1202-04, Cityplaza One, 1111 King's Road, Taikoo Shing, Hong Kong

ASIA Indonesia Thailand PT Savills Consultants Indonesia Robert Collins Greater China Jeffrey Hong Email: [email protected] Hong Kong SAR Email: [email protected] Tel: +66 2 636 0300 Raymond Lee 26/F, Abdulrahim Place, 990 Rama IV Road, Tel: +62 21 293 293 80 Email: [email protected] Bangkok 10500, Thailand Tel: +852 2842 4518 Panin Tower - Senayan City, 16th floor, Unit C, Jl. 23/F, Two Exchange Square, Central, Hong Kong Asia Afrika Lot. 19, Jakarta 10270, Indonesia Viet Nam With offices in Tsim Sha Tsui and Taikoo Japan Neil MacGregor Christian Mancini Email: [email protected] Central China Email: [email protected] Tel: +84 8 3823 9205 Wing Chu 18/F, Ruby Tower, 81-85 Ham Nghi Street, District 1, Tel: +81 3 6777 5150 Email: [email protected] Ho Chi Minh City, Viet Nam Tel: +8621 6391 6689 15/F Yurakucho ITOCiA, 2-7-1 Yurakucho, Unit 2501-13, Two ICC, No. 288 South Shanxi Road, Chiyoda-ku, Tokyo 100-0006, Japan With an office in Ha Noi Shanghai 200031, PRC Korea AUSTRALASIA Northern China Crystal Lee Email: [email protected] Anthony Mcquade Australia Email: [email protected] Tel: +822 2124 4114 Paul Craig Tel: +8610 5925 2002 13/F, Seoul Finance Center, 84 Taepyungro-1-ga, Email: [email protected] Unit 01, 21/F East Tower, Twin Towers, B-12 Chung-gu, Seoul 100-768, Korea Tel: +61 2 8215 8888 Jianguomenwai Avenue, Chaoyang, Beijing 100022, PRC Malaysia Level 25, 1 Farrer Place, Sydney, Australia Southern China Christopher Boyd Woody Lam Email: [email protected] Offices throughout Sydney, Parramatta, Canberra, Email: [email protected] Tel: +60 3 2092 5955 Melbourne, Notting Hill, Adelaide, Perth, Brisbane, Tel: +8620 3665 4777 Level 9, Menara Milenium, Jalan Damanlela, Bukit Gold Coast and Sunshine Coast Suite 1301, R&F Center, No. 10 Hua Xia Road, Damansara, 50490 Kuala Lumpur, Malaysia Zhujiang New Town, Guangzhou 510623, PRC New Zealand With 2 branches throughout Malaysia Paddy Callesen Western China Phillipines Email: [email protected] Eric Wo Tel: +64 0 9 951 5911 KMC MAG Group Email: [email protected] Level 6, 41 Shortland Street, Auckland, Tel: +8628 8658 7828 Michael McCullough NZ 1010, New Zealand Room 2106, Yanlord Landmark Square, No. 1 Section 2, Email: [email protected] Renmin South Road, Jinjiang District, Chengdu, PRC Tel: +632 403 5519 NORTH AMERICA 8/F Sun Life Centre, 5th Ave, With offices in Chongqing, Dalian, Hangzhou, Savills Studley Bonifacio Global City 1634, Philippines Nanjing, Shenyang, Shenzhen, Tianjin, Wuhan, Woody Heller Xiamen, Xi'an and Zhuhai Singapore Email: [email protected] Christopher Marriott Tel: +1 212 326 1000 Macau SAR Email: [email protected] 399 Park Avenue, 11th Floor, New York, Franco Liu NY 10022 Email: [email protected] Tel: +65 6415 7582 Tel: +853 2878 0623 30 Cecil Street, #20-03 Prudential Tower, Suite 1309-10, 13/F Macau Landmark, Singapore 049712 UNITED KINGDOM & EUROPE 555 Avenida da Amizade, Macau Harry Philpott Taiwan Email: [email protected] India Ricky Huang Tel: +852 2842 4277 Anurag Mathur Email: [email protected] 23/F Two Exchange Square, Central, Hong Kong Email: [email protected] Tel: +886 2 8789 5828 Tel: +91 22 4090 7300 21F, Cathay Landmark, Offices throughout the United Kingdom, Belgium, WeWork Forum, DLF Cyber City, Phase 3, Sector No. 68, Sec. 5, Zho ngxiao E. Road, France, Germany, Hungary, Italy, Netherlands, 24, Gurgaon, Haryana 122002 Xinyi District, Taipei City 110, Taiwan Poland, Spain and Sweden Associate offices in Austria, Greece, Norway, Portugal, Russia, Turkey With offices in Bangalore and Mumbai With an office in Taichung and South Africa

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