WHY DUBLIN? WHY NOW?

WHY DUBLIN? WHY NOW?

2 Why Dublin? Why Now? Introduction 3 Welcome to Dublin The investment story for Ireland is compelling right now. Dublin Glasgow Belfast Edinburgh Newcastle Liverpool Manchester Birmingham Cardiff Bristol London Ireland is an established modern open economy with a long tradition of successful foreign direct investment. As an independent country with its own economy and being part of the Eurozone, Ireland has many impressive achievements, particularly for a country of its size. Investors are attracted to Ireland for the pro-business environment. The 12.5% corporate tax rate, young highly skilled workforce, London time zone, and overall transparency make Ireland a great place to do business. It is this culture which drove Ireland to face up early to the economic crisis in 28 and pull together to make difficult decisions, becoming an exemplary model of compliance with macro-economic discipline, as described by European Central Bank President Mario Draghi. Now, a belief in Ireland s economic and property recovery is what is driving investor demand, with real opportunities available across sectors. My top 5 reasons for investing in Dublin real estate now are: 1. Recovery Ireland is moving in the right direction with strong GDP growth comparable to the UK and prime office rental growth forecast to be number 1 across Europe 2. Opportunity The recovery has started but prime office capital values are still 59% lower than the peak 3. Sustainable Dublin is in the second phase of growth and therefore recovery is expected to be sustainable 4. Liquidity it is a liquid market with investment volumes for 214 forecast to be ahead of the peak of the property market in 26 5. Dublin is a great city it is an exciting European capital city and hub of business and economic activity It is not just that Dublin is a great city to invest in; timing is key, and that time is now. There are significant opportunities in Dublin real estate to avail of the low capital values and Ireland s recovery story. JLL has been in Ireland for 5 years acting for landlords, tenants, investors and vendors. This is one of the most exciting times to be involved in property in Ireland. Ireland Key Facts Ireland Population 4.6 million Capital City Dublin Dublin Population 1.3 million Currency Euro ( ) Eurozone Member since 1999 Language English Time Zone GMT (+.) Dublin Office Market 3.7 million sq m John Moran Managing Director and Head of Investment JLL Ireland

4 Why Dublin? Why Now? Strong Sustainable Recovery 5 Strong Sustainable Recovery Ireland s macro-economic recovery has been one of the most robust in Europe. Due to early government interventions, which saw the implementation of a number of fiscal reforms, Ireland has exited its EU IMF bailout, returned to bond markets, and progressed out of its recession with consecutive positive GDP growth. Capital ratios across Ireland s domestic banks are now strong at 12-14% (Department of Finance, Ireland). Ireland s economic recovery in recent years has been driven by the export sector, with strength in technology, pharmaceuticals and chemicals, manufacturing, food, and business and financial services. Ireland s membership in the European Union (EU) allows free trade between the community s 27 member states and as a member of the Eurozone, Ireland is also part of the Euro currency. GDP growth is forecast at an average of 2.6% per annum between 214 and 218 which is comparable to the UK (2.7%) and Norway (2.6%), and is significantly ahead of the European average (1.5%) (Oxford Economics). There is also a clear sign of recovery in labour markets, with decreasing unemployment rates from a peak of 15.1% in 212 to 11.6% in 214 (CSO). There is no inflationary pressure on the economy. Prices of goods and services have increased by.4% in the last 12 months (CSO). Annual % Change Number of Persons ('s) 8% 6% 4% 2% % -2% -4% -6% -8% 2,2 2,1 2, 1,9 1,8 1,7 1,6 IRELAND GDP HISTORIC AND FORECAST GDP 24 25 26 27 28 29 21 211 212 213 214 (f) 215 (f) 216 (f) 217 (f) 218 (f) 219 (f) 22 (f) Source: Oxford Economics EMPLOYMENT LEVELS AND UNEMPLOYMENT RATE 28 29 21 211 212 213 214 (f) 215 (f) 216 (f) 217 (f) 218 (f) 219 (f) 22 (f) Employment Total Source: Oxford Economics Unemployment Rate 16 14 12 1 8 6 4 2 Unemployment Rate (%) Ireland was the first country in Europe to face up to the economic crisis. It tackled issues head on and has been exemplary in its recovery Ireland s main trading partners are Europe (particularly the UK) and the US. The US is the single biggest source of foreign direct investment in Ireland and accounts for over 7% of inward investment employment (Ulster Bank). Ireland s 1 year bond yields are now sub 2.5% and are lower than the UK and the US. Ireland has moved 9 places up the IMD World Competitiveness Yearbook since 211 and is now ranked 15th in the world. The improvements were driven by improving productivity and efficiency, and decreasing business costs (labour, services and property). The cost of living in Dublin has also decreased significantly. Dublin is now the 51st most expensive city in the world to live compared to 1th position in 25 (Mercer Cost of Living Survey 214). GDP Growth (%) 5. 4. 3. 2. 1. EUROPE AVERAGE GDP FORECAST GROWTH PER ANNUM 214-218. -1. Lithuania Turkey Poland Romania Czech Republic UK Ireland Norway Luxembourg Russia Hungary Switzerland Spain Germany Greece Eurozone Portugal Netherlands France Italy Cyprus Source: Oxford Economics

6 Why Dublin? Why Now? The Best Place in the World to do Business 7 The Best Place in the World to Ireland is the Best Country in the World for Doing Business Forbes 213 #1 Top destination country for foreign direct investment IBM Global Location Trends Facts and Figures 212 Investment Incentives IMD World Competitiveness Yearbook 213 Business Legislation openness to foreign investors do Business IMD World Competitiveness Yearbook 213 Flexibility and Adaptability of Workforce IMD World Competitiveness Yearbook 213 Ireland is the chosen European base of over 1,15 international companies (IDA). Over 5% of the world s leading financial services firms have a presence in Ireland (IDA). Ireland is the location of: 9 of the top 1 global ICT companies (IDA) 9 of the top 1 global pharmaceutical companies (IDA) There is a higher percentage of population aged 15-34 in Ireland with third-level qualifications (48%) compared to the UK, US and OECD average (IDA). Ireland is ranked as a Highly Transparent Market in the 213 JLL Global Transparency Index and is the 8th most transparent market in the world. All of the top 1 Born on the Internet companies (IDA) Tech Companies in Ireland Google Facebook Paypal E-Bay LinkedIn Amazon Twitter Yahoo EA Games AOL Intel HP IBM Microsoft SAP EMC Dropbox Dell Pharma Companies in Ireland Novartis Pfizer Roche Sanofi Merck & Co GSK Eli Lilly AbbVie Johnson & Johnson GE Healthcare Siemens Medtronic Philips Stryker Roche Diagnostics Covidien Abbott Boston Scientific B Braun Financial Companies in Ireland Citi JP Morgan Chase Deutsche Bank BNP Paribas Bank of America Wells Fargo Barclays BNY Mellon State Street Northern Trust Citco Mitsubishi UFJ Fund Services Fidelity Allianz Munich Re Zurich MasterCard Western Union

8 Why Dublin? Why Now? A Thriving, Vibrant Capital City 9 Dublin is a Thriving, Vibrant Capital City Dublin is the capital city of Ireland and is both the political and economic hub of the country. It is home to a growing population of 1.3 million inhabitants of which 53% are under 35 years old (CSO). Comparable in size to regional UK cities it has the benefit of being a European capital city. Dublin is an exciting place to live, work and visit. The vibrancy from music, theatre, culture and sporting events, along with its renowned bars and night life generate a real buzz in the city. In the last 5 years, Dublin has evolved into one of Europe s tech hubs and is the European headquarters location for Google, LinkedIn, Facebook and Twitter. These are acting as a magnet to other similar companies, and a young, skilled workforce. Ireland is the only native English-speaking member of the Euro, but with so many European HQ s in Dublin, there are a lot of other country native language speakers in the city. There are diverse modes of urban infrastructure (tram, railway, bus, city bikes and airport connections) with a number of on-going government-led regeneration and transport improvements currently underway across the city. In a wider context, the city benefits from an excellent location in Europe, and is within a 2 hour flight of most major European cities. Tourism is a key part of Dublin s economy, attracting almost 4 million overseas visitors in 213 and the Guinness Storehouse is the most visited attraction. Ideally placed for both east and west time zone connections, Dublin is in the same time-zone as London. Companies relocating to Dublin benefit from Ireland s 12.5% corporate tax rate and 25% research and development tax credits. Number of People 17, 16, 15, 14, 13, 12, 11, 1, FOREIGN DIRECT INVESTMENT EMPLOYMENT IN IRELAND 29 21 211 212 213 Source: IDA There was a record number of people employed in foreign direct investment jobs in Ireland in 213 more than 161, (IDA) Growing Population The population of Dublin increased by +7.2% between 26 and 211 (CSO) Home from Home 34.1 million American s have Irish ancestry (US Census). US companies looking to expand into Ireland like the similarities in language, food, culture and work ethic. Connections to the World Dublin Airport handled over 2 million passengers last year (Dublin Airport Authority), serving 175 routes including every country in the EU, and providing same-day connections to the US and Asia. Many tech start-up companies move to Ireland and expand quickly. Most start in small serviced office suites and end up in corporate HQs. Since Google moved to Dublin in 23, they have grown from a staff of 5 to employing more than 2,5 people from 65 different countries. Ireland is now Google s largest operation outside of the US (IDA). Since 211, Google has spent approximately 28m purchasing almost 45, sq m of office space in Dublin and also leases a further 14, sq m of space in the city.

1 Why Dublin? Why Now? A Sophisticated, Highly Liquid Market 11 A Sophisticated, Highly Liquid Market Dublin has one of the best real estate recovery stories in Europe. The stability in the economy and recovery in occupier markets has created a solid investment story for the city. The market bottomed in 212, and since then, it has turned a corner. Dublin property markets are now in the second phase of recovery, with stabilised growth across all sectors driving market activity. Investment activity has now returned to levels ahead of the peak, with total volumes for 214 forecast to hit $5.44 billion ( 4. billion). Investor demand is broad across all asset classes, with recent sales in offices, retail, industrial, hotels and pubs. In terms of geography, Dublin is the dominant market in Ireland. Volumes ($ Billion) 6 5 4 3 2 1 TOTAL INVESTMENT VOLUMES (DIRECT AND LOAN) 24 25 26 27 28 Investment Volumes 29 21 211 212 213 Number of Deals 214 (f) 2 15 1 5 Number of Deals Limited availability of prime office space will drive rental growth Sustainable strong occupier demand for prime offices is forecast to continue Office capital values decreased by 66% from peak-totrough but have since increased by 19%. They still remain 59% below the peak of the market and are currently at 1998 levels in real terms. Source: JLL Ireland Compared to other cities across Europe, prime Dublin office yields continue to offer strong returns ahead of similar stable markets. The prime Dublin office rent is at $66 / 484 per sq m per annum. This level of rent is comparable to other European cities such as Luxembourg ($685 / 54 per sq m), Oslo ($66 / 484 per sq m), Milan ($612 / 445 per sq m), and Frankfurt ($571 / 42 per sq m) (JLL EMEA Data). In the next 5 years, Dublin prime office rental growth (+7.4%) is forecast to be the strongest performer across the whole of Europe. This is greater than Madrid (+5.%), London City (+4.6%), London West End (4.4%), Oslo (+3.8%), and the European average (+2.5%) (JLL EMEA Data). Dublin is an established international market with approximately 65% of investor demand from overseas. In our experience, over 9% of all offers are from cash bidders, compared to less than 1% in the peak.

12 Why Dublin? Why Now? Market Facts. Why Now? 13 Market Facts. Why Now? Low supply of prime offices is driving rental growth Q2 214 Market Rents $66 per sq m ( 485 per sq m) Prime office rents are still 25% below the peak Peak Market Rents (26) $88 per sq m ( 645 per sq m) LONDON GENEVA PARIS LUXEMBOURG STOCKHOLM OSLO DUBLIN MILAN FRANKFURT MANCHESTER ROME EDINBURGH BIRMINGHAM GLASGOW AMSTERDAM LEEDS MADRID HAMBURG 4, 35, 3, CURRENT PRIME EUROPEAN OFFICE RENTS 5 1 15 2 Source: JLL EMEA $ per sq m per annum Prime Dublin office rents are affordable relative to other European cities DUBLIN OFFICE TAKE-UP & CONSTRUCTION LEVELS DUBLIN MADRID LONDON - CITY LONDON - WEST END OSLO PARIS - CBD STOCKHOLM MILAN MUNICH PRAGUE MOSCOW LISBON BUDAPEST WARSAW BUCHAREST AMSTERDAM COPENHAGEN BRUSSELS ROME LUXEMBOURG EUROPE Dublin has the strongest forecast rental growth in Europe EUROPEAN CITIES PRIME FORECAST AVERAGE ANNUAL OFFICE RENTAL GROWTH 214-218 % 2% 4% 6% 8% Source: JLL EMEA Dublin yields offer value compared to other European cities, with stronger rental growth projected Current EMEA Prime Office Yields Country City Prime Yield (%) Switzerland Zurich 3.2 UK London 3.75 France Paris 4. Sweden Stockholm 4. Germany Munich 4.3 Austria Vienna 5. Denmark Copenhagen 5. 25, Finland Helsinki 5.1 Trough Market Rents (212) $44 per sq m ( 323 per sq m) SQ M 2, 15, 1, 5, 22 23 24 Take-up Source: JLL Ireland 25 26 27 28 29 21 211 Under Construction 212 213 There were no office construction starts for the 4 years up to 214. Strong take-up during this period has resulted in supply shortages for prime office space in Dublin 214 (f) JLL Index Q1 98 Q1 99 Q1 Q1 1 Q1 2 Q1 3 Q1 4 Q1 5 Q1 6 Q1 7 Q1 8 Q1 9 Q1 1 Q1 11 Q1 12 Q1 13 Q1 14 The JLL Office Capital Value Index is at 1998 levels JLL IRISH PROPERTY INDEX OFFICE CAPITAL VALUES 14 12 1 8 6 4 2 Ireland Dublin 5.25 Italy Rome 5.3 Netherlands Amsterdam 5.45 Spain Madrid 5.5 UK Edinburgh 5.75 UK Manchester 5.75 Belgium Brussels 5.8 Poland Warsaw 6. Spain Barcelona 6.25 UAE Abu Dhabi 7. Portugal Lisbon 7.25 Source: JLL EMEA Source: JLL Ireland

14 Why Dublin? Why Now? Contacts 15 Contacts Why Dublin? Why Now? Dublin is back on the radar of investors across the world. After years of limited market activity, Dublin property markets are rebounding. The market is operating very differently now compared to the peak, with strong demand from overseas cash investors. The market is showing real depth in liquidity and activity is strong with volumes ahead of the peak. The recovery is driven by increasing stability in the economy, the strength of Dublin and Ireland as an investment location, and the significant opportunities available in real estate. With office capital values still almost 6% below peak and rental growth forecast to be ahead of any city in Europe, Dublin offers a significant opportunity to avail of one of the most robust property market recovery stories in Europe. As Dublin enters the second phase of its recovery, the turnaround we have seen in the market is set to be a sustainable one. Ireland s economic growth rates are comparable to the UK. There are also similarities in operating processes, with property and legal systems based on the UK model. Dublin is often compared to large UK cities in terms of size, however, Dublin boasts the economic, infrastructural and cultural benefits of being a capital city. Ireland is also part of the Euro currency and benefits from low financing costs. Dublin is an exciting European capital city with a thriving business and investment market. With direct flights to every capital city in Europe and same-day connections to the US and Asia, Dublin is very accessible from every part of the world. Dublin is a vibrant, cosmopolitan capital city where young people want to live and work. With resemblances to San Francisco at the beginning of its tech boom, Dublin is starting to show similar characteristics of an evolving hub of tech activity. The Silicon Docks is a thriving, buzzy part of the city, with industry innovators (Twitter, Facebook, LinkedIn, Amazon), trendy bars and restaurants, urban living spaces and a young, skilled workforce. Dublin is a great city to invest, and the time for investing in real estate is now John Moran Managing Director & Head of Investment +353 1 673 1637 john.moran@eu.jll.com Information correct as at 11th July 214. Margaret Fleming International Director Investment +353 1 673 1655 margaret.fleming@eu.jll.com Hannah Dwyer Head of Research +353 1 673 1665 hannah.dwyer@eu.jll.com

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