Singapore Office and Retail Market Overview By CBRE Pte. Ltd. 8 June 2013

Transcription

1 Singapore Office and Retail Market Overview By CBRE Pte. Ltd. 8 June The Singapore Economy Singapore s economy avoided recession in 212 with a GDP growth of 1.3% y-o-y. The main strain came from the relatively weak manufacturing sector, which is reliant on exports and susceptible to adverse global developments. In addition, headline inflation caused some concern in the first half of 212, though inflationary pressure eased significantly in the second half of the year, with 212 s inflation ending at 4.6%. Going forward, the economy will be supported by reasonable growth of the construction and services segments. The expected recovery in the manufacturing sector across Asia will support a growth in regional trade which would benefit Singapore. The Ministry of Trade and Industry ( MTI ) has forecast GDP growth to be between 1. to 3.% in 213 and the outlook for inflation is projected to be between 3.5% and 4.5% in 213. According to Oxford Economics, Singapore s GDP is forecast to grow by 2.5% and 4.9% in 213 and 214 respectively. In the long-term, however the economy faces some challenges as it adjusts to lower population growth and easing of the current immigration policy in coming years. Labour is expected to become more costly and therefore impact future economic growth. Consequently, GDP growth forecasts for have been lowered to an average of 3.6% pa. 2 The Office Market 2.1 Supply As at Q1 213, the total office stock in Singapore was million sf. Singapore s pre-eminent destination for office occupiers is the Core Central Business District ( Core CBD ), which consists of Raffles Place, Shenton Way Corridor, Marina Centre and Marina Bay. The million sf of office space in the Core CBD represents some 5% of overall office stock, and is the location of choice for highend financial services functions and other business services companies. The immediate environs of the Core CBD are the micro-markets of Tanjong Pagar, Beach Road/City Hall and Orchard Road, which represent a further 3% of existing stock (collectively the Fringe CBD). With 8% of total office stock found in the Core and Fringe CBD, the leasing and investment sales market is highly focused on these two locations. The remaining office stock can be found in decentralized locations such as Alexandra/HarbourFront, Thomson/Novena, Tampines and River Valley. The Tanjong Pagar micro-market 1 contributes 4.69 million sf and 9% of the total market while the Alexandra/ HarbourFront 2 micro-market contributes 3.55 million sf and 7%. Both micro-markets are characterized by a wide range of assets, which vary greatly in age and quality. Singapore s office market expanded at an exponential pace between 29 and 211 when 7.43 million sf of new office space was delivered to the market. This was a substantial 16.% market growth over a three-year period. Office development activity, however, has slowed since. GDP Growth and Inflation (%, Y-o-y change) GDP (LHA) Consumer price index (RHA) Source: Oxford Economics 38 Annual Report 212/13

2 The market grew by 2.5% in just over a year (Q1 212 to Q1 213 inclusive) with a total of 1.34 million sf of new office space completed mainly in two office projects - Marina Bay Financial Centre Tower 3 (totalling 1,3, sf) and One Upper Pickering (office component of ParkRoyal on Pickering, totalling 7, sf), completed in Q1 212 and Q3 212 respectively. In terms of net new office supply 3, the 1-year average was 1.1 million sf while the 5-year average was 1.67 million sf. In comparison, 212 s net supply of 923,2 sf is below these long term averages, which has provided some support to the office leasing market despite the weak global economy. Q1 213 net supply was a negative 274,8 sf, due to a number of projects being demolished or vacated for conversion; namely 138 Robinson Rd (totalling 121,674 sf) and Marina Bayfront (totalling 153,172 sf). Both Tanjong Pagar and Alexandra/HarbourFront micromarkets remain tight on new supply with no recent completions. In Tanjong Pagar the last developments were Twenty Anson (completed in Q4 29) and Mapletree Anson (completed in Q3 29). The last completion in the Alexandra/HarbourFront micro-market was the office component of Mapletree Business City (completed in Q2 21). Potential Supply Over the next four years (Q2 213 Q4 216 inclusive), an approximate 8.96 million sf of office space is expected to be delivered island-wide. The potential office supply is evenly distributed over time and geography. 37.5% of future supply is expected to be Grade A (located in CBD) while 34.9% and 27.6% will be from the CBD (non-grade A) and Rest of the Island markets respectively. Throughout 213, 2.84 million sf of new space will be completed comprising of Asia Square Tower 2 (782,3 sf) and The Metropolis (1,18, sf). Supply in 214 includes CapitaGreen (72, sf), while supply in 215 will come mainly from the South Beach development (527,45 sf). In 216, there will be a wave of new office completions totalling 4.27 million sf. The major projects are Marina One and Duo (1,88, sf and 57, sf respectively) by M+S, in addition to the Tanjong Pagar Centre (85,sf) by GuocoLand. The latter is a mixed-development in Tanjong Pagar, which will potentially enhance the overall attractiveness and rejuvenate this micro-market with new amenities such as quality retail, high-end hotel and new modern office supply. Potential Office Supply NLA (mil sf) Core CBD Fringe CBD Decentralised Source: CBRE Research For the confidentiality reasons CBRE cannot provide the full list of buildings in the particular baskets but to name a few key projects. 1 The Tanjong Pagar basket of properties consists of 23 buildings that total 4.7 million sf, none of which is classified as Grade A. The key projects are 79 Anson Road, Keppel Towers, Axa Tower, Mapletree Anson and Twenty Anson among others. 2 The Alexandra/HarbourFront basket of properties consists of 12 buildings that total 3.5 million sf, none of which is classified as Grade A. The key projects are HarbourFront Tower 1 and 2, Keppel Bay Tower, HarbourFront Centre and PSA Building among others. 3 Net new supply is calculated as a sum of new completions, demolitions and conversions. Annual Report 212/13 39

3 Singapore Office and Retail Market Overview By CBRE Pte. Ltd. 8 June 213 There are no office developments scheduled in the Alexandra/HarbourFront micro-market in the next five years. However, approximately 1. million sf of business park space will be delivered in Mapletree Business City Phase II in 216. As at Q1 213, the estimated secondary space is calculated to be approximately 282, sf. This is a vast improvement from the estimated 84, sf of secondary space projected for 213 in Q It has been observed that some older buildings and portfolios have enjoyed considerable success in back-filling such space. In addition, some landlords have also taken the opportunity to undertake asset enhancement works when their anchor / larger tenants relocate. This may cause a delay in the availability of some of the secondary space; for instance, 6 Shenton Way (formerly DBS Building). The positive net absorption of the secondary space is likely to ease some of the downward rental pressures on the Grade B market segment. 2.2 Demand In 212 and early 213, office demand was diverse with occupiers from a wide variety of industries relocating or expanding. Office space has been mostly taken up by commodity and energy companies, maritime, insurance, legal and professional services companies. Diversification has also taken place in terms of nationalities. It was reported that there have been more Japanese services firms setting up in Singapore. According to the Singapore Economic Development Board, there were 29 new Japanese companies registrations in 212 as compared to only six in 28. Conversely, demand from banks and other financial institutions have stayed subdued along with anchor tenant deals seeking large floor-plate requirements. However, the Singapore office market has retained its cost competitive edge over other regional cities and some corporates took advantage of lower occupancy costs to either consolidate or incrementally expand their operations. This has dramatically helped to stimulate leasing activity. Furthermore, flight to quality has been a pronounced feature of tenant movement in core locations but a strong appetite to move out of CBD to quality decentralised space has also been observed. Leasing sentiment was boosted by relatively high pre-commitment levels in the upcoming The Metropolis (65% pre-let as of Q1 213 to a diverse mix of occupiers such as Proctor & Gamble, Shell International B.V., Neptune Orient Lines and the Singapore Exchange), JEM (1% pre-let to MND), Westgate Tower (5% pre-let to CapitaLand) as well as Asia Square Tower 2 (2% pre-let to tenants such as Allianz, National Australia Bank, JustOffice and Swiss RE). Following the healthy 1.33 million sf net absorption recorded for the full year of 212 (average 332, sf per quarter), the net absorption for Q1 213 stayed in positive territory at 126, sf. Modest positive occupier demand is expected to maintain through the rest of 213. Island-wide Office: Net Supply, Net Absorption & Vacancy Rate NLA ( sf) 2, 1,5 1, , -1,5 12% 1% 8% 6% 4% 2% % -2% -4% -6% -8% Q1 28 Q2 28 Q3 28 Q4 28 Q1 29 Q2 29 Q3 29 Q4 29 Q1 21 Q2 21 Q3 21 Q4 21 Q1 211 Q2 211 Q3 211 Q4 211 Q1 212 Q2 212 Q3 212 Q4 212 Q1 213 Net New Supply New Absorption Vacancy Rate (Islandwide) Source: CBRE Research 4 Annual Report 212/13

4 Office demand in Tanjong Pagar has benefited from its proximity to the Core CBD, the planned urban regeneration of the area and the expected relocation of existing occupiers of the nearby GE and Keppel Towers (totalling 43,122 sf). The two developments are due to be demolished and converted for residential use although no time horizon has been announced. On average, the 1-year annual net absorption in this micro-market is 118,3 sf while in Q1 213 it was a positive 14,8 sf. Alexandra/HarbourFront is a well located micro-market that has outperformed other micro-markets during periods of downturn when occupiers opted for more affordable quality office space that was close to the CBD as part of their cost rationalization. It remains an attractive solution to occupier who prefer fringe locations with good amenities. On average, the 1-year annual net absorption in this micro-market is 165,9 sf, while Q1 213 was a negative 17,1 sf. Net absorption in this micro-market is projected to stay close to zero in 213 and Vacancy Rates Positive net absorption in 212 and Q1 213 served to lower the overall island-wide office vacancy rate by 7 basis points q-o-q from 5.8% to 5.1% and by 22 basis points from 7.3% 15 months ago. This is the lowest level recorded since Q3 28 at 4.5%. Global economic conditions, while showing gradual improvements, will continue to weigh on office leasing demand. Vacancy rates across all grades and micro-markets are expected to increase and peak in 213. In 214, supported by an economic recovery and subsequently by improved office demand, vacancy rate is forecast to hover in the region of 6.% - 8.%. In the Tanjong Pagar micro-market, the vacancy rate stood at 4.% in Q Given the limited supply in recent years, the vacancy rate has been declining over the long term and is currently relatively low compared to its long term averages. The 1-year average vacancy is calculated to be 11.2% while the 5-year average vacancy was 8.1%. Going forward, vacancy rate in the micro-market is expected to remain low given that no significant new supply is due till 216. That said, some upward pressure will be inevitable in the short term given that both new and secondary supply are due to be delivered in the adjacent core CBD. The Alexandra/HarbourFront micro-market has historically recorded a very low vacancy rate as the attractiveness of the location improved over time with completion of new MRT line and increasing residential catchment in the area. Over the last five years, the micro-market vacancy rate rose above 5.% only in 29. In Q1 213, Alexandra/HarbourFront vacancy stood at 2.15%, 48 basis points below Q The micro-market has no future office supply for the next five years, which should provide existing developments a competitive advantage and limit the increase in vacancies. That said the location has well established business park properties and confirmed future pipeline that could compete with the adjacent office properties. In addition, the opening of new decentralised office locations such as Jurong and Buona Vista may add further competition. Office Vacancy Rates 2% 18% 16% 14% 12% 1% 8% 6% 4% 2% % Q1 28 Q2 28 Q3 28 Q4 28 Q1 29 Q2 29 Q3 29 Q4 29 Q1 21 Q2 21 Q3 21 Q4 21 Q1 211 Q2 211 Q3 211 Q4 211 Q1 212 Q2 212 Q3 212 Q4 212 Q1 213 Islandwide Alexandra/Harbourfront Tanjong Pagar Source: CBRE Research Annual Report 212/13 41

5 Singapore Office and Retail Market Overview By CBRE Pte. Ltd. 8 June Rents Whilst occupier demand has surprised the market on the upside, it was not sufficient to avert rental corrections. Office rents have been declining for six consecutive quarters; however, the pace decelerated over the last few quarters. All in all, average Grade A rent has corrected by 13.7% since the peak in Q3 211 while the Grade B office rental correction was much less pronounced with average rent declining by 3.7%. In Q1 213, average Grade A rent saw a minor decrease of.3% q-o-q to register at $9.55 psf/month. Similarly, the Grade B market saw a slight correction of.1% q-o-q to $7.1 psf/month. Looking ahead, Grade A rents could find their support levels to reach the trough by the second half of 213. Flight to quality has been a visible trend in this segment, which will support the activity in the Grade A office market and provide resilience to its rents. The first signs of upward rental movements are expected in 214 although at modest levels compared to the past. Conversely, the Grade B market is likely to experience more pressure in 213 due to the injection of office space coming from new decentralised locations, strata-titled offices as well as secondary space. Grade B rents are projected to decline by up to 1% in 213 although the downturn should be short lived and recovery could happen as early as in 214. Singapore Office Rents Q1 213 (psf/mth) 11 Peak to Now Y-o-Y Q-o-Q Grade A S$ % -9.9% -.3% Grade B Island-wide S$ % 2.1% -.1% Tanjong Pagar S$ % -1.4% -.6% Alexandra/HarbourFront S$ % -.4% -.2% Source: CBRE Research Office Rents (in S$ psf/month) Q1 28 Q2 28 Q3 28 Q4 28 Q1 29 Q2 29 Q3 29 Q4 29 Q1 21 Q2 21 Q3 21 Q4 21 Q1 211 Q2 211 Q3 211 Q4 211 Q1 212 Q2 212 Q3 212 Q4 212 Q1 213 Grade A Alexandra/Harbourfront Grade B Island-wide Tanjong Pagar URA Rental Index Source: CBRE Research, Urban Redevelopment Authority (URA) 42 Annual Report 212/13

6 Despite moving in tandem with the island-wide office rental cycle, Tanjong Pagar rents have displayed less volatility over the past five years. This is primarily due to the tenant mix in the Tanjong Pagar micro-market, which has a higher percentage of non-banking and financial services office tenants compared to Core CBD. Average office rents had grown by 48.3 % since the bottom in 29 and peaked at S$7.1 psf/month in Q They have since declined by a limited 2.5% to $6.92 psf/month in Q New developments (built since 28) in the Tanjong Pagar area, however, have commanded rents of $8. psf/mth in Q This is a substantially higher rental level compared to the full Tanjong Pagar micro-market rent, indicating a substantial difference between the new and old stock in the area. Looking ahead, a combination of fairly valued office rents in Tanjong Pagar and less new supply alternatives appearing in the immediate neighbourhood will support stable rental performance in the next six to twelve months. Average office rents in Alexandra/HarbourFront peaked at S$7. psf/month in Q3 211 and it has since declined by a limited.8% to $6.94 psf/month in Q Going forward, the Alexandra/HarbourFront rents are expected to remain stable throughout 213 and 214 considering the low vacancy in the micro-market. 2.5 Office Outlook The risk of a severe global recession has moderated with well-aimed policy initiatives of the major central banks globally; however, the recovery is likely to be gradual and long drawn. Regardless, Singapore s office demand in 212 has surprised on the upside and it is expected to remain in positive territory throughout 213 as the city has retained its attractiveness to occupiers as a base for their regional operations. Flight to quality will remain the key trend in the next six to twelve months where occupiers will take the opportunity to consolidate or expand their operations due to the relatively lower occupancy costs. Grade A rents are forecast to remain stable in the next six to eight months and recover thereafter. While overall demand is expected to remain positive, Grade B office space of lower technical quality and in less prime locations is likely to see rents declining further mostly due to the weight of supply available. Any hint of a global economic recovery will translate to a stronger recovery in the office market. That said the strength of upside remains highly dependent on the health of the financial industry, which has driven leasing demand in the past. In order to outperform other global business cities in such market conditions, Singapore will have to use the advantage of being an attractive location and a lower cost base destination to attract new occupiers in the future. 3 The Retail Market 3.1 Supply As at Q1 213, the total island-wide retail stock stood at million sf. By market size comparison, the Fringe Area still accounts for the largest share at 27.6%, followed by Outside Central Region (22.4%), Orchard Road (2.3%), Rest of Central Area (18.2%) and the Downtown Core Region (11.6%). Driven by strong demand and appetite for new retail space, the market expanded exponentially in recent years. In the period from 29 to 212, approximately 2.21 million sf of new retail space was added to total private retail supply. 29 witnessed the largest addition of approximately 1.37 million sf retail space, mostly in the Orchard submarket. Major malls completed along Orchard Road since 29 include Ion Orchard (66, sf), Orchard Central (25, sf), 313 Somerset (294, sf), Mandarin Gallery (13, sf) and TripleOne Somerset (294, sf). After 29, the bulk of the retail supply has come from outside the prime area of Orchard. This includes Marina Bay Shoppes (8, sf) and Resorts World Sentosa (33, sf) as well as nex (6, sf). Other notable malls completed outside Orchard include Rochester Mall (95,3 sf), Changi City Point (27,4 sf) and the convenience centre Alexandra Retail Centre (89,6 sf). Most recently, several landlords have embarked on asset enhancement initiatives (AEI) on their assets in order to keep up with new trends. Annual Report 212/13 43

7 Singapore Office and Retail Market Overview By CBRE Pte. Ltd. 8 June 213 The inclusion of Resorts World Sentosa and Alexandra Retail Centre was the only retail supply in the HarbourFront/ Telok Blangah area since VivoCity in 26. It should be noted that the retail space in Resorts World Sentosa has been predominantly taken up by food & beverage outlets as well as a master tenant. As such, VivoCity still remains the only full-fledged shopping mall serving the area. The only new retail developments in Tanjong Pagar in recent years were a retail podium of ICON (totalling 3, sf) completed in 27, followed by recent asset enhancement of 1AM (totalling 11, sf) completed in 212. Retail in the Tanjong Pagar area predominantly caters to the working population in the area, but also serves the increasing resident population. Potential Supply Based on data tracked by CBRE, the projected island-wide retail supply (Q2 213 to Q4 217 inclusive) is approximately 5.65 million sf. The significant majority of potential supply is expected in 213 and 214; while geographically much of the new space is located in suburban locations. In 213, Jem (818, sf) and Westgate (42, sf) are expected to open in the Jurong Lake District. Other upcoming suburban retail spaces include East Village Hotel (43,7 sf), HillV2 (55, sf), Paya Lebar Square (88,2 sf) and Bedok Mall (22, sf). Lastly, there is an upcoming retail project Orchardgateway (172, sf) along Orchard Road. In 214, retail supply will be more geographically diverse across all four sub-markets. The completion of the refurbished Shaw Centre (4, sf) and 268 Orchard (147,5 sf) will add to the Orchard Road sub-market stock. From the Downtown Core sub-market, retail space expected include the completion of the AEI of Suntec City (125, sf), the AEI of One Raffles Place (14, sf), Capitol Piazza (156,1 sf) as well as the extension wing of Marina Square (2, sf). The key retail development arising from the Fringe Area sub-market will be the Sports Hub (441,5 sf) while One KM (11,7 sf) and Seletar Mall (188, sf) will add to the suburban stock in 214. Come 215, projects with retail space sold on a stratatitled basis will dominate the supply. These projects include Altez (18,6 sf), Eon Shenton (5,2 sf), Park Hotel Alexandra (46,45 sf), Changi (18,3 sf), The Pelikat (83,4 sf) & The Irving (36, sf). Two major suburban retail projects include Waterway Point (37, sf) and Big Box (329, sf); while South Beach (85,5 sf) will add to the Downtown Core sub-market supply. Finally in 216, a significant supply of retail space will arise from the Downtown Core sub-market with the completion of Marina One (14, sf), Tanjong Pagar Centre (1, sf) and a yet named commercial development at Robinson Road (1,6 sf). Other notable potential projects in this year include Duo Galleria (54, sf) and Hillion Mall (114,45 sf) from the Rest of Central and Outside Central Area sub-markets. Potential Retail Supply: NLA (mil sf) Orchard Road Downtown Core Rest of Central Fringe Area Suburban Source: URA / CBRE Research 44 Annual Report 212/13

8 3.2 Demand Supported by positive indicators of consumer spending and healthy visitor arrivals in 212, retail occupier demand continued to grow especially from the fast fashion and food & beverage (F&B) industries. European retailers continued to be a major player in the Orchard Road retail scene, with Korean and Japanese brands following suit. While such potential tenants continued to seek large and flexible retail floor plates, majority of the new F&B outlets are located in non-shopping mall lifestyle destinations as well as in niche shop-house locations. The Singapore Tourist Board reported a 9.1% y-o-y growth with visitor arrivals for 212 hitting million. Tourism receipts reached $23. billion in 212, a growth of 3.% y-o-y. This is expected to moderate to between 3.% to 4.% annually over the next decade while tourism receipts are expected to grow between 4.% to 6.% annually over the same period. Excluding the sales of motor vehicles, nominal retail sales for March 213 displayed a decline of.5% m-o-m and a growth of 1.2% y-o-y. This is mainly attributed to the higher sales during the Chinese New Year holiday which was in February 213. Following the positive 53,8 sf net absorption recorded for the full year of 212, net absorption for Q1 213 for the private retail market as tracked by URA was recorded at -215, sf. This negative net absorption caused a compression in the island-wide private retail occupancy rate q-o-q by basis points percentage points to 93.1%. Retail leasing demand should remain relatively steady in 213, particularly from international fast fashion retailers and F&B start-ups. Retailers will continue to focus on growth opportunities but at a more moderate pace and on a more strategic basis than in previous quarters. Consolidation of operations has also been observed to be on the business decisions of some retailers who have been on the expansion mode for the previous years. Consumer confidence, however, should remain positive due to the healthy domestic economy and rising household incomes and spending power. Nominal retail sales are expected to remain in a positive growth territory but at a lower rate going forward. Visitor Arrivals & Retail Sales Index (Excluding Motor Vehicles) 16,, 14,, 12,, 1,, 8,, 6,, 4,, 2,, Tourist arrival Retail sales Index (excluding motor vehicles) Source: Singapore Tourist Board / Department of Statistics Annual Report 212/13 45

9 Singapore Office and Retail Market Overview By CBRE Pte. Ltd. 8 June 213 Island-wide Office: Net Supply, Net Absorption & Vacancy Rate NLA ( sf) % 6% 4% 2% % -2% -4% Q1 28 Q2 28 Q3 28 Q4 28 Q1 29 Q2 29 Q3 29 Q4 29 Q1 21 Q2 21 Q3 21 Q4 21 Q1 211 Q2 211 Q3 211 Q4 211 Q1 212 Q2 212 Q3 212 Q4 212 Q1 213 Net New Supply New Absorption Vacancy Rate (Islandwide) Source: URA / CRE Research 3.3 Rents Relatively subdued nominal retail sales have weighed down the rental market. To boost activity, there has been a series of asset enhancement initiatives undertaken by several of the large Orchard Road malls in the last two years. In addition, ION Orchard, Orchard Central and 313 Orchard have taken advantage of their lease renewal period since their commencement to reposition themselves in the market. As a result of renewals, the average rents for prime Orchard Road has risen by 1.9% q-o-q to reach $32.2 psf/month in Q This is after nine months of static rents in this market. For the past 12 months, average prime Suburban rents stayed at $29.75 psf/month. From the chart on page 47, it is clearly illustrated that the rent premium of Orchard Road sub-market over the Suburban sub-market has compressed significantly over the past three years. Orchard Road rents have been correcting since Q3 28 following the Sub-prime crisis and onslaught of retail supply. On the other hand, the Suburban sub-market has shown its resilience over the past years with minimal fluctuations as they are not highly dependent on the tourism market and are well supported by their respective residential catchment areas. 3.4 Retail Outlook While Singapore continues to enjoy tourism growth, it is expected to remain in the spotlight for international brands seeking exposure to consumers in the region. Retail occupancy costs in Singapore are still lower as compared to other Asian cities like Hong Kong, Shanghai, Beijing and Tokyo, which provide confidence for the retailers to establish in the market. Leading indicators have shown that retail sales and business sentiments continued to be positive. That said the retail market might be affected by the strength of the Singapore dollar and further exacerbated by the current labour crunch faced by the service industry. In the tourist-dependent prime Orchard Road market, average rents are expected to hover at the same levels in 212. Orchard Road will always remain the prime shopping belt, with a critical mass of shopping centres located in the heart of the city and well served by hotels. As a result, major international and luxury brands still prefer to be located along this shopping belt. Although driven by different spending habits the suburban retail market remains active. The upcoming suburban malls are typically located within residential catchments and near to major transport infrastructure, allowing them to draw on regular customers who frequent the malls for their daily necessities and services. Supported by relative strong interest from retailers, suburban average rents are expected to remain stable. 46 Annual Report 212/13

10 Prime Retail Rents Q1 28 Q2 28 Q3 28 Q4 28 Q1 29 Q2 29 Q3 29 Q4 29 Q1 21 Q2 21 Q3 21 Q4 21 Q1 211 Q2 211 Q3 211 Q4 211 Q1 212 Q2 212 Q3 212 Q4 212 Q1 213 Orchard Road Suburban URA Rental Index Source: URA / CBRE Research Qualifying Clause This Report is subject to the following limiting conditions: The content of this report is for information only and should not be relied upon as a substitute for professional advice, which should be sought from CBRE prior to acting in reliance upon any such information. The opinions, estimates and information given herein or otherwise in relation hereto are made by CBRE and affiliated companies in their best judgment, in the utmost good faith and are as far as possible based on data or sources which they believe to be reliable in the context hereto. Where it is stated in the Report that information has been supplied to CBRE s by another party, this information is believed to be reliable by CBRE. Other information is derived from sources which we believe to be reliable to the best of our ability. We can accept no responsibility if this should prove not to be so. Notwithstanding this, CBRE disclaims any liability in respect of any claim that may arise from any errors or omissions, or from providing such advice, opinion, judgment or information. All rights are reserved. No part of this report may be reproduced, stored in a retrieval system, or transmitted, in any form or by any means, electronic, mechanical, photocopying, recording, or otherwise, without the prior written permission of CBRE. Annual Report 212/13 47