KAUNASKAUNAS OFFICEOFFICE OUTLOOKOUTLOOK 20182018 MODERN OFFICE PREMISES KAUNAS OFFICE OUTLOOK 2018 MODERN OFFICE PREMISES

SUPPLY in other European countries. Vacancy 2,600 sqm at ARKA and SEB signed for By the end of 2017, the stock of modern increases in old office buildings as they nearly 2,000 sqm at NEMUNO 3. office premises in Kaunas was 143,300 sqm, become abandoned by tenants that move or 0.49 sqm per capita. In recent years to newly built office centres, which also There were a couple of new companies the face of the city has been changing launch partly vacant. starting operations in Kaunas: as the office market in Kaunas grows Confidential IT company signed up rapidly. In 2017 alone, the stock grew by Eleven office buildings were opened almost 500 sqm at KAUNO DOKAS, while 44% as 11 office centres (44,000 sqm) in Kaunas in 2017, all of them B class TGW signed for 400 sqm at RIVER HALL. launched, while 17 openings (99,000 sqm) premises. The biggest openings in More newcomers are expected in the are planned for 2018-2019. terms of area offered were SITIS with near future. occupancy of 95% by the end of 2017, Currently, all office stock in Kaunas is B66 with occupancy of 90% and KAUNO With companies wishing to secure B class, but the city’s office market is DOKAS with occupancy of 70%. the best office space, pre-leases are changing rapidly in this regard as well. becoming more and more common in Four major office centres launching in Average vacancy rates are now expected Kaunas. Leases are typically signed 6 2018-2019 will be A class premises with a to increase slightly, as in 2018 12 more to 12 months prior to handing over the total gross leasable area of 44,300 sqm. new office centres will launch and even premises. more tenants will leave older premises. Recent office building development is However, A class premises opening in RENT RATES occurring in concentrated areas forming 2018-2019 are expected to be almost fully By the end of 2017, the average market two main clusters around the city pre-leased. rent for B class modern office space in centre. In 2017, a New Business District Kaunas was in the range of 8-11 EUR/sqm/ started forming on Jonava Street with DEMAND month, reaching 11.5 EUR/sqm/month comfortable B+ class offices being its In 2017, the total take-up of modern in some cases. Meanwhile, the asking main offering. The CBD area will grow offices amounted to nearly 35,000 sqm. rental price for A class premises opening further as ARKA, MAGNUM, NEMUNO 3 Such a high yearly amount marked an all- in 2018-2019 currently amounts to 12-14 and BLC2 are all due to launch there in time record in the Kaunas office market. EUR/sqm/month. 2018-2019. Almost all transactions in 2017 were Rental rates in old office buildings are VACANCY either relocations or expansions of expected to fall slightly as competition By the end of 2017, the vacancy rate companies already existing in Kaunas. is expected to intensify in the next in Kaunas was 11%. Such a percentage Several major companies signed few years. Changes in the market of vacant space is significantly higher contracts for premises in new office are expected as landlords become than in Vilnius (average of 3.4%) but is centres: FESTO signed for 5,600 sqm susceptible to negotiations and older completely normal compared to cities at KREVES 129, SWEDBANK signed for premises will have to be renovated in order to remain competitive.

KAUNAS OFFICE STOCK BY CLASS, sqm Source: Newsec OFFICE STOCK PER CAPITA IN CENTRAL AND EASTERN % EUROPEAN CITIES 300,000 City Total Stock Population Stock per Capita 250,000 Budapest 3,300,000 1,759,400 1.88

200,000 Tallinn 710,000 420,000 1.69 Katowice 473,000 299,900 1.58 150,000 Krakow 1,073,100 762,500 1.41 100,000 Sofia 1,663,000 1,260,100 1.32 50,000 Vilnius 595,500 546,300 1.09 - Riga 640,000 641,500 1.00 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018E 2019E Kaunas 143.300 290,100 0.49 B Class A Class

2 KAUNAS OFFICE OUTLOOK 2018 MODERN OFFICE PREMISES

«The Kaunas office market is changing rapidly – four major office centres launching in 2018-2019 will be A class premises with a total gross leasable area of 44,300 sqm»

OFFICE BUILDINGS LAUNCHED IN KAUNAS 2017

No. Developer/Owner Name Leasable area, sqm Class Address 1 Cetarium Kauno Duona 8 550 B V. Kreves av. 129 2 Realinija Jonavos 30 2 500 B Jonavos st. 30 3 Urban Inventors Kauno Dokas I 9 150 B Jonavos st. 7 4 YIT Kausta B66 4 930 B K. Barsausko st. 66 5 Miesto renesansas Renesansas I 3 500 B A. Juozapaviciaus av. 11D 6 Vaistiniu valda Birželio 23 1 500 B Birzelio 23-osios st. 4 7 Altas Pramones BC 2 560 B Pramones av. 4A 8 Infokodas Savanoriu 277 1 500 B Savanoriu av. 277 9 Mj Consulting Sitis 3 400 B Veiveriu str. 139 10 Abromika Lapeno Namas 1 800 B Kestucio st. 38 11 Polonezas Ausra Business Park A & B 4 500 B Vytauto av. 23, 27, 29 TOTAL 43 890

AVERAGE VACANCY RATE IN CEE Source: Newsec AVERAGE OFFICE RENT RATE, EUR/sqm/month Source: Newsec % 18 14 12.70% 16 14-16 12 11.00% 14 10.20% 12-14 10 9.20% 12 8.60% 9-12 8 10 8-11 7.00% 8 6 5.50% 6 4 3.40% 4 2 2

0 0 Katowice Kaunas Sofia Krakow Budapest Riga Tallinn Vilnius Kaunas Vilnius Kaunas Vilnius

B class A class

3 MODERN OFFICE PREMISES KAUNAS OFFICE OUTLOOK 2018

OFFICE BUILDINGS IN KAUNAS KLAIPĖDA

No Project Name Address, street Openings of 2017 1 Kauno Dokas Jonavos str. 7 2 Kauno Duona V. Kreves ave. 129 3 Jonavos 30 Jonavos str. 30 49 4 B66 Barsausko str. 66 5 Renesansas 1 Juozapaviciaus str. 11 6 Birzelio 23 Birzelio 23-osios str. 4 KAUNAS FEZ 7 Pramones BC Pramones ave. 4A 8 Savanoriu 277 Savanoriu ave. 277 9 Sitis Veiveriu str. 139 EIGULIAI 10 Lapeno Namas Kestucio str. 38 MURAVA 11 Ausra Business Park A&B Vytauto ave. 23, 27, 29 SILAINIAI VILNIUS Openings of 2018 38 12 Arka Karaliaus Mindaugo ave. 37 13 Kauno Dokas II Jonavos str. 7 14 River Hall Jonavos str. 60 2 15 Konversus Chemijos str. 15 28 16 K26A New V. Kreves str. 26A 17 Kalantos 49 Kalantos str. 49 33 32 34 18 Nemuno 3 Nemuno str. 3 20 19 Partizanu 15B Partizanu str. 15B 59 30 20 Cube Savanoriu ave. 321C 44 21 Ausra Business Park C Vytauto ave. 23, 27, 29 8 22 A43 Ateities hwy. 43 60 41 16 DAINAVA 23 KMA Kaunakiemio str. 1 19 47 Openings of 2019 and later 6 24 Magnum Karaliaus Mindaugo ave. 38 57 25 BLC2 K. Donelaicio str. 60 26 Renesansas 2 Juozapaviciaus str. 13 39 42 54 27 Piliamiescio BC Brastos str. 24 28 Savanoriu 367 Savanoriu ave. 367 36 ZALIAKALNIS Existing Office buildings VILIJAMPOLE 58 7 29 Maironio 28 Maironio str. 28 48 PETRASIUNAI 30 Plaza BC Taikos ave. 141 50 13 51 1 31 Swedbank Maironio str. 26B 27 14 15 56 32 BC 363 Savanoriu ave. 363A GRICIUPIS 33 Savanoriu 363A Savanoriu ave. 363 45 3 35 34 Savanoriu 349 Savanoriu ave. 349 25 35 BLC Donelaicio str. 62 52 29 4 36 Artis Savanoriu ave. 178 31 17 37 Vytauto 32 Vytauto ave. 32 OLD TOWN 53 10 38 Diurablis Partizanu str. 63M 18 55 12 43 39 Savanoriu 221 Savanoriu ave. 221 24 40 Technopolis Europos ave. 121 CENTRE 41 BC 1000 Taikos ave. 88A 37 42 Nordic BC Savanoriu ave. 192 46 43 Kalantos 161 R. Kalantos str. 161 21 11 44 Savanoriu 292B Savanoriu ave. 292B ALEKSOTAS 45 Capital Putvinskio str. 50 46 Ausra Business Park Vytauto ave. 23, 27, 29 23 47 K26A V. Kreves str. 26A 48 Barkodas Pramones ave. 4D FREDA 49 Senukai BC Islandijos hwy. 32 50 NFQ (BTS) Brastos str. 15 51 BC Mikrovisata Savanoriu ave. 109 52 Ozeskienes 17 Ozeskienes str. 17 53 Maironio 11 Maironio str. 11 SANCIAI 54 Pramones 23 Pramones ave. 23 40 55 Kalantos 34 R. Kalantos str. 34 56 Chemijos 9D Chemijos str. 19A PANEMUNE 57 Neries BC Neries krnt. 18 58 Barkodas Pramones ave. 4E 59 Daimonda Taikos ave. 131B 60 Partizanu 15 Partizanu str. 15 26 9 5 Under development Office buildings Central business district Existing Office buildings New business district Old business district 4 KAUNAS OFFICE OUTLOOK 2018 MODERN OFFICE PREMISES

OFFICE BUILDINGS IN KAUNAS KLAIPĖDA

No Project Name Address, street Openings of 2017 1 Kauno Dokas Jonavos str. 7 2 Kauno Duona V. Kreves ave. 129 3 Jonavos 30 Jonavos str. 30 49 4 B66 Barsausko str. 66 5 Renesansas 1 Juozapaviciaus str. 11 6 Birzelio 23 Birzelio 23-osios str. 4 KAUNAS FEZ 7 Pramones BC Pramones ave. 4A 8 Savanoriu 277 Savanoriu ave. 277 9 Sitis Veiveriu str. 139 EIGULIAI 10 Lapeno Namas Kestucio str. 38 MURAVA 11 Ausra Business Park A&B Vytauto ave. 23, 27, 29 SILAINIAI VILNIUS Openings of 2018 38 12 Arka Karaliaus Mindaugo ave. 37 13 Kauno Dokas II Jonavos str. 7 14 River Hall Jonavos str. 60 2 15 Konversus Chemijos str. 15 28 16 K26A New V. Kreves str. 26A 17 Kalantos 49 Kalantos str. 49 33 32 34 18 Nemuno 3 Nemuno str. 3 20 19 Partizanu 15B Partizanu str. 15B 59 30 20 Cube Savanoriu ave. 321C 44 21 Ausra Business Park C Vytauto ave. 23, 27, 29 8 22 A43 Ateities hwy. 43 60 41 16 DAINAVA 23 KMA Kaunakiemio str. 1 19 47 Openings of 2019 and later 6 24 Magnum Karaliaus Mindaugo ave. 38 57 25 BLC2 K. Donelaicio str. 60 26 Renesansas 2 Juozapaviciaus str. 13 39 42 54 27 Piliamiescio BC Brastos str. 24 28 Savanoriu 367 Savanoriu ave. 367 36 ZALIAKALNIS Existing Office buildings VILIJAMPOLE 58 7 29 Maironio 28 Maironio str. 28 48 PETRASIUNAI 30 Plaza BC Taikos ave. 141 50 13 51 1 31 Swedbank Maironio str. 26B 27 14 15 56 32 BC 363 Savanoriu ave. 363A GRICIUPIS 33 Savanoriu 363A Savanoriu ave. 363 45 3 35 34 Savanoriu 349 Savanoriu ave. 349 25 35 BLC Donelaicio str. 62 52 29 4 36 Artis Savanoriu ave. 178 31 17 37 Vytauto 32 Vytauto ave. 32 OLD TOWN 53 10 38 Diurablis Partizanu str. 63M 18 55 12 43 39 Savanoriu 221 Savanoriu ave. 221 24 40 Technopolis Europos ave. 121 CENTRE 41 BC 1000 Taikos ave. 88A 37 42 Nordic BC Savanoriu ave. 192 46 43 Kalantos 161 R. Kalantos str. 161 21 11 44 Savanoriu 292B Savanoriu ave. 292B ALEKSOTAS 45 Capital Putvinskio str. 50 46 Ausra Business Park Vytauto ave. 23, 27, 29 23 47 K26A V. Kreves str. 26A 48 Barkodas Pramones ave. 4D FREDA 49 Senukai BC Islandijos hwy. 32 50 NFQ (BTS) Brastos str. 15 51 BC Mikrovisata Savanoriu ave. 109 52 Ozeskienes 17 Ozeskienes str. 17 53 Maironio 11 Maironio str. 11 SANCIAI 54 Pramones 23 Pramones ave. 23 40 55 Kalantos 34 R. Kalantos str. 34 56 Chemijos 9D Chemijos str. 19A PANEMUNE 57 Neries BC Neries krnt. 18 58 Barkodas Pramones ave. 4E 59 Daimonda Taikos ave. 131B 60 Partizanu 15 Partizanu str. 15 26 9 5 Under development Office buildings Central business district Existing Office buildings New business district Old business district 5 MODERN OFFICE PREMISES KAUNAS OFFICE OUTLOOK 2018 THE FULL SERVICE PROPERTY HOUSE

IN NORTHERN EUROPE

Newsec — The Full Service Property expanded internationally into Finland 2000 co-workers spread across the House in Northern Europe — is by far the in 2001, Norway in 2005, the Baltic seven Nordic and Baltic markets. largest specialised commercial property countries in 2009 and Denmark in 2016. Newsec has approx. EUR 39 billion under firm in Northern Europe. The Norwegian asset and property management and annually signs lease management companies First Newsec agreements of some 760 000 sqm, Newsec manages more properties and Asset Management and TM Partner manages transactions of some carries out more transactions, more were acquired in 2012. In 2013, Newsec EUR 3 billion and does real estate lettings and more valuations than any acquired Jones Lang LaSalle’s Swedish valuations of underlying property worth other firm in Northern Europe. Through property management operation. In almost EUR 180 billion. Thanks to large this great volume, and the knowledge 2017, Newsec grew with the acquisitions volumes, local presence combined with and depth of our various operations, we of Norwegian Basale and Danish Datea, in-depth understanding of a range acquire extensive and detailed knowledge further strengthening the position within of businesses, Newsec has a unique of the real estate market. In turn, we can Property Asset Management. expertise of the real estate market in quickly identify business opportunities northern Europe. that create added value. Newsec was founded in 1994 and is today a partner-owned company with some Our prime market is Northern Europe, but through our alliance membership with BNP Paribas Real Estate, we offer our services on the global market. This makes Newsec Northern Europe’s only full service property house, and provides us with a unique ability to forecast the future.

A history of growth Newsec is the result of a unique OULU history of growth, characterised by constant originality of thinking. The first issue of the comprehensive market TRONDHEIM analysis, Newsec Property Outlook, was published in 2001. The Group TAMPERE

BERGEN OSLO HELSINKI STOCKHOLM TALLINN

GOTHENBURG RIGA AARHUS KLAIPEDA COPENHAGEN MALMÖ VILNIUS

KAUNAS

6 KAUNAS OFFICE OUTLOOK 2018 MODERN OFFICE PREMISES CONTACT AND ADDRESSES

More analytical information at Newsec: Office solutions at Newsec: LITHUANIA Head of Research and Analysis Head of Brokerage Konstitucijos ave. 21C Mindaugas Kulbokas Jurgita Silaikyte LT-08130 Vilnius Cell +370 652 10556 Cell +370 659 66808 Phone +370 5 252 6444 E-mail [email protected] E-mail [email protected] E-mail [email protected] www.newsec.lt Consultant Tenant Consulting Gintaras Tolocka Head of Corporate Solutions LATVIA Cell +370 685 06940 Martynas Babilas Vilandes str. 1 E-mail [email protected] Cell +370 616 12216 LV -1010 Riga E-mail [email protected] Phone +371 6750 84 00 E-mail [email protected] Landlord Consulting www.newsecbaltics.com Advisor Marius Prieskenis ESTONIA Cell +370 687 701 17 Roseni str. 7 E-mail [email protected] EE-10111 Tallinn Phone +372 664 5090 Office FIT-OUT Service E-mail [email protected] Head of Project Management www.newsecbaltics.com Tadas Grincevicius Cell +370 679 79779 E-mail [email protected]

Office Care and Property Management Head of Office Management Group Justas Bandza Cell +370 6555 8989 E-mail [email protected]

7 THE FULL SERVICE PROPERTY HOUSE IN NORTHERN EUROPE