Asia Pacific Property Digest Property Pacific Asia
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Jones Lang LaSalle • Asia Pacific Property Digest • First Quarter 2008 Asia Pacific Property Digest GREATER CHINA First Quarter 2008 Jones Lang LaSalle Research – Asia Pacific ASIA PACIFIC SOUTH EAST ASIA Dr Jane Murray SINgapoRE Head of Research – Asia Pacific Dr Chua Yang Liang +852 2846 5274 Head of Research – South East Asia and Singapore [email protected] +65 6474 3721 [email protected] GREATER CHINA INdoNESIA HONG KONG Anton Sitorus Marcos Chan Head of Research – Indonesia Head of Research – Hong Kong and Macau +62 21 515 5665 +852 2846 5276 [email protected] [email protected] THE PHILIPPINES macaU Katherine Marcelo Alvin Mak Research and Consulting Manager Assistant Manager +63 2 751 8131 +853 2871 8822 [email protected] [email protected] THAILAND SHANGHAI Dan Tantisunthorn Kenny Ho Head of Research – Thailand Head of Research – China +66 2 679 6500 +86 21 6133 5450 [email protected] [email protected] VIETNAM BEIJING Buu Le Benjamin Christensen Manager – Research and Consulting Head of Research – Beijing +84 8 910 3981 +86 10 5922 1379 [email protected] [email protected] MalaysIA CHENgdU (JONES LANG WooTTON IN assocIATION Shelly Xie WITH JONES LANG LASallE) Senior Research Analyst Malathi Thevendran +86 28 8665 1022 Executive Director – Research [email protected] tel +60 3 2161 2522 GUANGZHOU [email protected] Lily Li Head of Research – Guangzhou WEST ASIA +86 20 3891 1238 Manisha Grover [email protected] Head of Research and Consulting – West Asia +91 80 4118 2922 TIANJIN [email protected] Stefanie Zou Research Analyst INDIA +86 22 8319 2233 Abhishek Kiran Gupta [email protected] Head of Research – India +91 22 6658 1000 TaIPEI [email protected] Jeffrey Hurren Head of Research – Taiwan AUSTRALASIA +886 2 8758 9886 Kathryn Matthews [email protected] Head of Research and Consulting – Australasia and Australia +61 2 9220 8511 NORTH ASIA [email protected] JapaN Takeshi Akagi NEW ZEalaND Head of Research – Japan Chris Dibble +81 3 5501 9235 Researching and Consulting Manager [email protected] +64 9 366 1666 [email protected] SOUTH KOREA Darren Krakowiak INDUSTRIAL RESEARCH Head of Research and Consulting – South Korea Barnaby Martin +82 2 3704 8836 Industrial Research Manager [email protected] +86 21 6133 5442 [email protected] Ta B L E of C O NTENT S Asia Pacific Economy Residential. 25 Luxury Residential. 38 and Property Market . 4 Industrial . 26 High-End Residential. 39 Industrial - Business Parks. 40 Greater China . 10 Chengdu . 27 Industrial - Logistics. 41 Office. 27 Hong Kong . 12 Industrial - Manufacturing. 42 Retail. 28 Grade A Office. 12 Industrial - Business Parks. 29 Tianjin . 43 Retail. 18 Industrial - Manufacturing. 30 Office. 43 Luxury Residential. 19 Retail. 44 Industrial - Warehouse. 20 Guangzhou . 31 Industrial - Logistics. 45 Office. 31 Macau . 21 Retail. 32 Taipei . 46 Retail. 21 Industrial - Business Parks. 33 Office. 46 High-End Residential. 22 Industrial - Business Parks. 51 Shanghai . 34 Beijing . 23 Office. 34 Office. 23 Retail. 37 Prime Retail . 24 Jones Lang LaSalle • Asia Pacific Property Digest • First Quarter 2008 Asia Pacific Economy Global Growth Weakens, but Asia Pacific Will Continue To Outperform Dr Jane Murray Head of Research - Asia Pacific Spillover from the global slowdown… Global economic growth will decelerate in 2008 due modestly as emerging economies account for a large share largely to a sharp slowdown in some of the world’s major of its exports including commodities. Direct impacts from economies, including the US, UK, Eurozone and Japan. the financial market upheaval will be felt less acutely in Major central banks have injected massive amounts most of the region’s economies as banks generally have of liquidity into the financial system to bolster credit less exposure to sub-prime related debt and the financial availability, and the US Federal Reserve may further systems of many countries such as China have been reduce interest rates this year in addition to the 325- sheltered by government restrictions. basis-point easing between September 2007 and April 2008. The effects of the sub-prime crisis have been most …partly offset by internal momentum pronounced in the US and Western Europe to date, but all Most economies in Asia Pacific can still count on the countries will be affected to some extent through global strength of domestic demand. China’s annual GDP growth linkages. According to the Economist Intelligence Unit slowed to 10.6% in 1Q08 from 11.2% in 4Q07, but growth (EIU), world output in 2008 is projected to expand by in fixed investment continued to surge ahead at a rate 2.8%, or 1.5 percentage points less than the average of the of 25.9% y-o-y in 1Q08. The EIU expects China’s growth last four years. this year will moderate to 9.6%, still an aggressive rate of expansion. A similar mild slowing of growth in India is The global slowdown is expected to chiefly affect the Asia expected this year, with GDP forecast to slow to 7.8% from Pacific region through the international trade channel, 9.2% in 2007. Investment growth from both domestic and while FDI inflows should be relatively unaffected. international sources should continue at a brisk pace. Exports from China and North Asia will be hardest hit by In the mature economies of Hong Kong, Singapore and weakened import demand in the developed economies, Australia, tight labour markets and announced tax cuts but a knock-on effect will be felt in the rest of the region should help shore up consumer demand this year. An particularly South East Asia due to intra-regional trade exception to the domestic demand story is Japan, where links. Australian export growth is likely to slow only Figure 1: Real GDP Growth Figure 2: Consumer Price Inflation 12 20 18 10 16 8 14 12 6 10 y-o-y (%) y-o-y (%) 8 4 6 2 4 2 0 0 China India India China Taiwan Korea Japan Korea TaiwanJapan Vietnam Malaysia ThailandAustralia Vietnam AustraliaThailand Malaysia SingaporePhilippines IndonesiaHong Kong Indonesia Philippines SingaporeHong Kong New Zealand New Zealand 2007 2008F 2009-12F 2007 2008F 2009-12F Source: Economist Intelligence Unit, April 2008 Source: Economist Intelligence Unit, April 2008 Key Performance Indicators GDP (%) Prime Lending CPI (%) Employment Retail Sales Industrial Rate (%) Growth (%) Growth (%) Production (%) 2008F 2009F 2008F 2009F 2008F 2009F 2008F 2009F 2008F 2009F 2008F 2009F Hong Kong 4.0 4.6 5.9 6.4 4.3 3.4 1.9 1.5 5.5 3.1 0.4 -0.4 China 9.6 9.0 8.0 7.8 5.0 3.6 1.1 1.0 10.0 7.9 15.7 13.0 Taiwan 4.3 4.4 4.7 5.3 2.6 1.5 1.1 0.7 1.0 2.2 4.9 5.1 Japan 1.1 1.3 1.9 2.2 0.6 0.8 -0.9 -0.7 -0.6 1.6 2.2 2.7 South Korea 4.5 4.4 6.1 5.8 2.9 2.3 0.5 0.5 2.6 2.6 4.8 5.6 Philippines 5.4 5.5 8.7 9.3 5.1 3.6 2.4 3.1 3.7 5.3 5.5 5.5 Singapore 4.4 4.7 5.3 5.6 4.3 1.6 2.1 1.2 4.7 4.2 5.0 5.3 Malaysia 5.8 5.9 6.3 6.4 2.8 2.3 2.0 2.0 4.5 4.1 3.8 5.2 Thailand 4.7 4.3 6.4 6.2 5.0 2.9 1.2 1.2 -0.6 2.6 6.0 5.2 Indonesia 5.9 6.3 13.0 12.4 6.8 6.1 2.4 2.5 4.4 4.4 4.4 4.0 India 7.8 7.2 12.8 12.0 5.8 5.5 2.3 2.3 5.7 6.0 6.5 8.0 Australia 2.9 2.5 10.3 9.9 3.4 3.1 2.2 0.9 1.4 3.9 3.2 2.7 New Zealand 1.8 2.6 13.2 12.9 2.9 2.3 1.1 1.1 1.1 3.6 -0.4 1.5 Vietnam 8.0 8.4 11.8 12.0 18.2 9.0 2.2 2.5 0.8 4.9 15.4 16.5 World 2.8 3.0 NA NA 4.3 3.4 1.4 1.3 1.9 2.5 NA NA Source: Economist Intelligence Unit, April 2008 growth has been slowing, due partly to a major decline 16% since January and the Reserve Bank of Australia has in housing investment and more bearish consumer raised its cash rate target by fifty basis points since the sentiment (Figure 1). beginning of the year. The Reserve Bank of India raised the banking sector’s cash reserve ratio to 8.25% in April, Jones Lang LaSalle • Inflation a growing threat… the thirteenth increase since mid-2004. Hong Kong is an Led by surging demand for food and energy and high exception to this trend and has seen major declines in rates of capacity utilisation, cost pressures are picking interest rates over the last six months due to the pegging up in most of the region. China is still grappling with of the local currency to the US dollar.