Rental and capital value growth strengthens to 3% across Asia Pacific’s office market

Aggregate net take-up in office space across major Tier I markets reaches more than double the level of the previous year

SINGAPORE, February 1st 2010 – New research from Jones Lang LaSalle reveals that positive business sentiment and solid corporate hiring are buoying leasing demand in the office markets of Asia Pacific. In 2010, aggregate net take-up across major Tier I markets was more than double the level of the previous year.

Vacancies have stabilised or started to trend down in many cities and more markets moved to the upturn phase of the rental cycle in 4Q10. Of the 26 featured office markets, 17 saw an increase in net effective rents during the quarter. In the previous quarter, 12 markets recorded an increase in rents. Rental growth is accelerating, with an average quarter-on-quarter increase across the region of 3.1%. In 3Q10, quarterly rental growth averaged 1.8%.

Beijing recorded the largest quarterly rental growth of 9.0% in 4Q10, while rents in Shanghai grew by 7.9%, with the result for both markets being driven by strong spatial demand from MNCs and domestic corporates. Rents in Singapore grew by 8.6% q-o-q, underpinned by a temporary shortage of space. Hong Kong saw a further 4.6% increase on the back of a tight supply situation and solid demand by the financial sector. On an annual basis, Hong Kong led the way across the region, recording a strong 33% increase in rents.

In a few markets where tenant demand remains weak, rents are generally beginning to stabilise or grow moderately. For example, in Kuala Lumpur and Bangkok , rents remained stable in 4Q10 while in Tokyo , rents rose by 2.7% q-o-q as withdrawal of leasing incentives helped offset some residual declines in gross rentals. Rents in Australia and New Zealand saw moderate movements, both positive and negative during the quarter.

Jeremy Sheldon head of markets for Jones Lang LaSalle in Asia Pacific says, "the pick up in demand is broad based, and increasingly includes the local corporate sector, especially in China and India . MNC's seeking global growth opportunities are in the market as well as some new entrants. These trends will continue into 2011 barring any economic or political turbulence. This demand will exacerbate rental increases in markets where vacancy is already low."

Consistent with strong fundamentals, we expect leasing demand to remain solid and vacancies to generally trend down over the next few quarters. Driven by improving occupancy levels, the regional office market is now largely landlord favourable. Rental growth of up to 30% is expected across the region this year, with the strongest growth likely to be seen in supply constrained markets. However, there will be significant variations across markets, with a few laggards that are likely to see little, if any, growth.

Across the region, the average quarterly increase in capital values in 4Q10 was 3.2%, compared with 2.8% in 3Q10. Again Hong Kong outperformed over the year, recording a 36% increase in capital values on the back of strong buying activity, largely by local investors.

Stuart Crow head of Capital Markets for Jones Lang LaSalle in Asia Pacific comments, “Investors are in a confident mood, and capital values have recovered ahead of rents in most markets in anticipation of good growth. We are expecting investment volumes in Asia Pacific to rise by a further 20-25% in 2011 with improvements in the leasing markets helping buoy investor confidence. Companies are poised to start spending again but shortages of quality space will emerge, causing a shift to landlord favourable market conditions in Asia Pacific.”

Almost all major markets saw either stable or increasing capital values. The largest quarter-on- quarter increase was recorded in Singapore and Shanghai , both increasing by 10.0%. Hong Kong, Beijing and Guangzhou followed closely with quarterly increases of about 7.5%. Across the region, the average quarterly increase in capital values in 4Q10 was 3.2%, compared with 2.8% in 3Q10. Again Hong Kong outperformed over the year, recording a 36% increase in capital values on the back of strong buying activity, largely by local investors.

Capital values are expected to increase in nearly all markets during 2011, by up to 25%, as rental performance and investor confidence further improve. Markets expected to see the largest growth include Hong Kong, Tokyo , Singapore and the China Tier I cities.

JONES LANG LASALLE ACQUIRES CHURSTON HEARD, THE UK’S LEADING INDEPENDENT RETAIL CONSULTANT

Boosting its retail business in the UK

London, 10 July 2008 – Jones Lang LaSalle has announced that it is to acquire Churston Heard, the UK’s leading independent retail consultancy. Churston Heard employs 80 people and offers a full range of retail services including agency, town centre and out-of-town retail; rent reviews; management; investment, development and shopping centre management.

Alastair Hughes, CEO EMEA at Jones Lang LaSalle said: “This acquisition will further strengthen our business and improve our ability to advise clients on retail property in the UK. UK clients are looking for excellent local market knowledge within a first class international business – this acquisition will provide exactly that.”

“This is part of our strategy to strengthen our retail business across Europe. We will now be a market leader in the UK as well as Germany, Central & Eastern Europe, Russia and many other European markets.”

Churston Heard was established in 1969 and has an excellent reputation, providing a full range of consultancy services to an impressive client list of retailers, developers, institutions and funds. The combined strength of the two firms will see Jones Lang LaSalle’s shopping centre instructions increase to 110 and dedicated retail specialists rise to 150.

The new management structure will comprise Chris Powell as Chairman of Retail, EMEA; Guy Grainger will take on the role of Head of Retail Agency in the UK, working alongside Stuart La Frenais, Damian Sumner and Paul Marshall. Robin Coady will chair and jointly run the expanded UK Retail Capital Markets team with Adrian Peachey. Tim Vallance will lead the Out of Town team and Stephen Mahon will become the Head of Asset and Professional Advisory.
Chris Powell, from Churston Heard said: “We see Jones Lang LaSalle as a complementary fit to our culture, which is built on client service, market intelligence and expertise. It increases our reach and market share in the UK and drives our business forward across the continent. It will also provide new and exciting opportunities for our people.”

The deal, which will be concluded next week, will see Jones Lang LaSalle finance the acquisition through phased cash payments based on time and performance. The 80 Churston Heard employees will move into the Jones Lang LaSalle offices in Hanover Square in September.

Stuart La Frenais, Head of Retail Agency at Jones Lang La Salle commented: “It is well known that we have been looking to strengthen our retail business and Churston Heard has been top of our priority list for sometime. The structure of their business fits ideally with ours with their areas of strength complementing ours. Having worked at Churston Heard for several years I know a number of individuals well and know that the fit between our teams will be fantastic. I personally look forward to working with Guy again, together with the rest of the retail team at Churston Heard”.

“The combined business will focus on the UK and will also have a dedicated European retail team based in the UK which will co-ordinate with our strong European network of offices, covering 25 countries, to provide a seamless service for both our landlord and retailer clients.”

Guy Grainger, Head of Retail at Churston Heard added: “This provides our team with the ideal platform to apply our experience and skills to a wider network of clients, without huge disruption – we are a very good fit. Our retail intelligence will enable Jones Lang LaSalle and Churston Heard to create one of the largest and most experienced retail advisory services in Europe.”

Contact: Charlotte Freeman
Phone: 020 7399 5616

Email: Charlotte.freeman@eu.jll.com
Reference: NR3624

Contributed By : Arun Chitnis

83 per cent of Multi-Nationals in Asia Pacific Increasing or Maintaining Growth Plans in 2008

Jones Lang LaSalle Survey: 83 per cent of Multi-Nationals in Asia Pacific Increasing or Maintaining Growth Plans in 2008 India, China and Vietnam Remain the Top Three Destinations

India, 24 June 2008 – According to a Jones Lang LaSalle survey released today, 83 per cent of multi-national companies polled said that they will increase or maintain current growth plans in Asia Pacific. In fact, 28 per cent are responding to the gloomy global economic situation by looking to accelerate the growth of their operations in the region.

Jones Lang LaSalle’s survey also shows that India, China and Vietnam remained the top destinations for company growth plans in the region in 2008.

The report highlights that there are some key evolutionary changes occurring in the region’s economies, as individual nations continue to mature and attract higher value operations. These changes have a long-term impact on demand in the local property markets. For instance, in India, China and Vietnam, rising middle class incomes are driving growth for more banking retail outlets. Furthermore, China and India, once known for their low cost workforces, are, in some cases, losing factory jobs to other countries, but still enjoying significant net growth, as their increasing per capita incomes and advancing skills are attracting increasingly sophisticated activities.

Jones Lang LaSalle’s CEO of Regional Business Lines and Corporate Solutions, John Forrest, says that the survey shows how business in Asia remains less affected by the sub-prime crisis. “As the leading supplier of real estate services to corporations in Asia Pacific, we are still seeing strong demand for space. However, an uncertain economic environment is forcing corporations to find smarter ways to manage their growth. For example, many are outsourcing the management of their real estate or re-designing current office space to be more efficient.”

Jones Lang LaSalle, a professional services firm specializing in real estate, conducted a survey of 30 senior corporate real estate executives from leading multinational companies active in Asia Pacific in the second quarter of 2008. Findings from the survey are presented in the firm’s research paper, Gauging Demand, which focuses on how occupier demand for office and industrial space in Asia Pacific is being affected by global economic turmoil.

Strategies Differ by Industry Sector
Three sectors were surveyed, Financial Services, Technology and Manufacturing/Consumer Goods. Of the three, Financial Services predicts the most aggressive growth in 2008, with 44 per cent having added more growth to their original plans in the first quarter of the year, and 33 per cent predicting further growth by the end of the year. Even though this sector is showing the most aggressive growth of the three sectors some companies remain cautious with 44 per cent expecting to scale back in 2008. This is, in part, a reflection of the differing degree of exposure to sub-prime suffered by the banks – some emerged unscathed while others faced huge write-downs.

Where 44 per cent of Financial Services companies are expecting to scale back during the year, it is Manufacturing/Consumer Goods companies that are showing the most mixed response. The companies polled were split evenly, with a third looking to further expand their growth plans, a third to scale back and a third expects no change to current plans. Companies in this sector are also more likely to shift operations into or within the region, as they look for fresh markets and lower-cost destinations.

The most consistent of the three sectors is Technology. On average the majority, 83 per cent, are ramping up or maintaining current growth plans in the region in 2008 in response to the current economic climate. The reason cited by those surveyed lies in the search for greater revenues driven by the migration of their client base to Asia Pacific. Even though there are growth plans, cost containment remains a key driver for their real estate strategy.

Jones Lang LaSalle Meghraj India CEO, Vincent Lottefier, says "Different industry sectors are responding to the economic environment in markedly different ways, with traits that have significant implications for the markets in which they are major players. India still remains overwhelmingly the focal points of most new growth, easily outpacing the rest of the field."
Forrest comments that, “Even the financial sector, which has been the hardest hit in other regions, is not contracting on an overall basis. Emerging markets in Asia really are the world’s bright spot for growth at the moment.”

Contributed By : Arun Chitnis

Jones Lang LaSalle Named to 2008’s “World’s Most Ethical Companies” List by the Ethisphere Institute at The Forbes, Ethisphere Joint-Conference

CHICAGO, 5 June 2008 – Jones Lang LaSalle Incorporated (NYSE: JLL) today reported that it has been named to The Ethisphere Institute’s second-annual World’s Most Ethical Companies list. Ethisphere, a think-tank dedicated to the research and promotion of profitable best practices in global governance, business ethics, compliance and corporate responsibility, announced the award at the Ethisphere and Forbes joint-conference, “Driving Profit through Ethical Leadership,” held on June 3rd. The list of World’s Most Ethical companies will also be featured in the Q2 issue of Ethisphere Magazine.

“We are very proud of this award,” says Colin Dyer, Chief Executive Officer of Jones Lang LaSalle. “It reflects the significant effort we make through our Ethics Everywhere(sm) Program to act with integrity in everything we do. Our clients, employees and shareholders expect and deserve nothing less.”

Researchers and analysts from The Ethisphere Institute reviewed several thousand companies in order to determine the finalists, which included a rigorous, multi-step evaluation process. The 2008 World’s Most Ethical Companies methodology committee is comprised of leading attorneys and government officials, professors and leaders who care about ethical and honest business practices.

“We applaud Jones Lang LaSalle, which is among the companies honored this year because they have developed impressive and meaningful ethical business practices, making them true standouts within their industries.” says Alexander Brigham, executive director of Ethisphere Institute. “They go well beyond legal minimums, opting instead to bring about innovative ideas that contribute to the public well being. By their actions, they are forcing their competitors to follow suit, or fall behind and truly embodying the notion that ethical business practices are more profitable.”

The extensive research process included reviewing over 10,000 of the world’s leading companies on six continents. Ethisphere analysts reviewed codes of ethics, litigation and regulatory infraction histories; evaluated investment in innovation and sustainable business practices; looked at companies’ activities to improve corporate citizenship; studied nominations from senior executives, industry peers, suppliers and customers; and worked with consumer action groups for feedback and rating.

The day-long conference, which featured Forbes editors and executives from world-renowned corporations, universities and ethics organizations, focused on ethical culture and leadership and highlighted companies’ experiences and ethical challenges, provided advice on preparing for ethical dilemmas and gave viewpoints from an investor’s perspective. The conference culminated with recognizing Ethisphere Magazine’s 2008 World’s Most Ethical Companies at an evening awards dinner.

About Ethisphere Institute

The research-based Ethisphere Institute and associated membership group, the Ethisphere Council, are supported by more than 100 institutions and corporations, including Thomson West, the Practising Law Institute, the National Association of Corporate Directors, the Global Reporting Initiative, Corpedia and dozens of others. The Institute is dedicated to the research, creation, and sharing of best practices in ethics, compliance, and corporate governance among its membership companies. It also focuses on the development and advancement of individuals on its membership council through increased efficiency, innovation, tools, mentoring, advice, and unique career opportunities. Ethisphere Magazine is the quarterly publication of the Institute. More information on membership can be found at http://www.ethisphere.com/.

The Ethisphere Institute publishes the globally-recognized annual World Most Ethical Companies Ranking™ as well as the Government Contractor Ethics Program Ranking™ and the upcoming Global Anti-Corruption Quotient.

Contributed By : Arun Chitnis

Jones Lang LaSalle and Colonial First State Property Management Launch ‘Sandalwood’ in India

India Retail Witnesses Advent of Highly Specialized Mall and Asset Management Services

Jones Lang LaSalle and Colonial First State Property Management Launch ‘Sandalwood’ in India

Mumbai, 22 April 2008 - Riding on Asia’s robust retail growth and India’s unprecedented retail boom, Jones Lang LaSalle Incorporated (NYSE: JLL), and Colonial First State Property Management today announced a joint venture partnership to form Asia’s first integrated retail development and management service provider – Sandalwood. The 50:50 joint venture company will help Asian and Indian developers and retailers to capitalize on premium retail opportunities as well as creating long term value for retail assets.

Colonial First State Property Management is one of Australia’s largest full service property development, management and leasing specialists. Since its inception in 1983, the firm has undertaken more than 25 major shopping centre developments and now manages 36 centres on behalf of third party clients in every state of Australia, including iconic Chadstone Shopping Centre in Victoria, Chatswood Chase in Sydney and Queens Plaza in Brisbane.

India's retail sector is evolving at a swift pace and is set to grow by 35% by 2010. This growth has been fuelled by a strong economy, favourable demographics, rising wealth levels as well as rapidly changing lifestyles and consumer aspirations of an ever burgeoning middle class. The real estate sector has responded well to this retail growth. The total retail mall stock has been doubling every year, from a meagre one million sq ft in 2002 to a staggering 40 million sq ft in 2007 and an estimated 60 million sq ft by the end of 2008.

There are over 100 malls operating in India and more than 300 being developed and of this total, more than 90% have yet to achieve global benchmarks. In order to be globally successful, mall owners and developers in India need to focus on vision, scalability and processes and create a distinct proposition for themselves in this emerging market. Sandalwood, with its specialist property management skills and development expertise will ensure that retail owners and developers are strategically positioned for long term growth and success

Anuj Puri, Chairman and Country Head, Jones Lang LaSalle Meghraj says, “As retail in India grows at a rapid pace, this is indeed an opportune moment for us to introduce specialized retail and intensive asset management services. Sandalwood will seek to create long term value for India’s mall owners through its globally benchmarked practices, proven expertise in property development and intensive asset management.”

Darren Steinberg, Head of Colonial First State Property Management says, “Asian economies are amongst the fastest growing in the world with real GDP compound average growth of approximately 9% per annum over the last five years, and their retail management and property development markets have grown at a compound average growth rate of more than 20% in the same period. Colonial First State Property Management’s specialist retail property management skills enable property owners to receive the benefit of master planning and development expertise which is critical to ensuring assets are enhanced and strategically positioned for long-term growth and success."

Stewart Hutcheon has been appointed as the new Chief Executive Officer of Sandalwood Asia. Mr Hutcheon is well known and highly regarded by the retail management and property development community in Australia. His impressive career includes over 18 years experience in the retail property sector. His most recent appointment was as Director of Leasing and Deputy Managing Director of AMP Capital Shopping Centres Pty Ltd, with shopping centre assets under management of approximately A$9 billion. Prior to that, he spent over seven years at Westfield, Australia.

In India, Sandalwood’s operations will be spearheaded by Ms Gagan Singh, who has over 28 years of experience across the apparel, exports and hospitality sectors. In addition to performing her new role, she holds the position of Deputy CEO of Jones Lang LaSalle Meghraj.

Ms Singh says, “I am delighted to be heading up this new and exciting company. Sandalwood will draw upon global expertise and local knowledge to bring our clients’ visions to highly profitable retail environment that is based on strong differentiation for their retail assets. Sandalwood seeks to help create space not just to shop in, but to ‘live’ in.”

Mr Puri concludes, “We are excited by the opportunities that lie ahead for Sandalwood India. The retail business in India is growing and the pace is expected to accelerate. The market and business outlook is extremely positive and Sandalwood is well-positioned to be an industry leader in the active retail sector in India.”

About Jones Lang LaSalle

Jones Lang LaSalle (NYSE:JLL) is a professional services firm specializing in real estate. The firm offers integrated services delivered by expert teams worldwide to clients seeking increased value by owning, occupying or investing in real estate. With 2007 global revenue of USD 2.7 billion, Jones Lang LaSalle has approximately 170 offices worldwide and operates in more than 700 cities in 60 countries. The firm is an industry leader in property and corporate facility management services, with a global portfolio of approximately 1.2 billion square feet. LaSalle Investment Management, the company’s investment management business, is one of the world’s largest and most diverse in real estate with approximately USD 49.7 billion of assets under management. For further information, please visit our website, www.joneslanglasalle.com.

Jones Lang LaSalle has over 50 years of experience in Asia Pacific, with over 16,000 employees operating in more than 70 offices in 13 countries across the region.


About Jones Lang LaSalle Meghraj

Jones Lang LaSalle Meghraj, the Indian operations of Jones Lang LaSalle, is the premiere and largest real estate professional services firm in India. With an extensive geographic footprint across ten cities (Delhi, Mumbai, Bangalore, Pune, Chennai, Hyderabad, Kolkata, Kochi, Chandigarh and Coimbatore) and a staff strength of over 3300, the firm provides investors, developers, local corporates and multinational companies with a comprehensive range of services including research, consultancy, transactions, project and development services, integrated facility management, property management, capital markets, residential, hotels and retail advisory. For further information, please visit www.jllm.co.in

About Colonial First State Property Management

Established in 1983, Colonial First State Property Management (CFSPM), is today one of Australia’s largest full service property development, management and leasing specialists.
CFSPM has acquired more than two decades of intelligence on Australia’s retail property markets, with the iconic Chadstone Shopping Centre in Victoria remaining as one of its outstanding achievements. Since inception, CFSPM has undertaken more than 25 major shopping centre developments and now manages 36 centres on behalf of third party clients in every state of Australia.

As a member of Colonial First State Global Asset Management, the largest manager of Australian-sourced funds, CFSPM provides critical services to a range of assets held within Colonial First State Global Asset Management’s suite of listed and unlisted property funds and mandates. These services, covering the gamut of retail and office property requirements, are also provided to other third party clients outside the Colonial family of companies. Ultimately, CFSPM’s key point of difference in the market place is the fact it has 700 professionals on the ground at any given time. This means CFSPM is close to the issues at hand and able to react quickly and strategically in every situation.

CFSPM has expanded its capabilities beyond the retail sector and is steadily growing its operations in the office sector. The business is committed to growing both parts of the business. With a core focus on maximising investors’ returns on an asset by asset basis, CFSPM is a critical component of our property investment management offering.

Contributed By : Arun Chitnis

Kolkata’s real estate market is set for a high growth phase fuelled by the IT/ITES sector

Kolkata’s real estate market is set for a high growth phase fuelled by the IT/ITES sector. This is according to the report, “Emerging City Winners Profiles: Kolkata”, released today by Jones Lang LaSalle, one of the world’s leading real estate services firm. An increasing corporate presence in the city is also triggering growth for Retail, Hospitality and Residential properties.

“Kolkata boasts of a highly literate and well equipped workforce, lower land acquisition costs (when compared to Mumbai and Delhi) and attractive government initiatives which make it a compelling destination for corporates and developers, alike”, said Mr Vincent Lottefier, Country Head, Jones Lang LaSalle India. He further added, “We at Jones Lang LaSalle are excited to be a part of Kolkata’s growth and pleased to offer our entire range services including transaction management services, retail advisory, strategic consulting, capital markets, property management, integrated facility management and project and development services.

The report states that increasing corporate presence is stimulating growth in per capita income and encouraging consumption in Kolkata. Overall, the city provides a positive environment for new corporate entrants, as well as existing corporates eying expansion.

Abhishek Kiran Gupta, Senior Manager, Research, Jones Lang LaSalle, India adds “Kolkata is now on the ‘global radar’ of multi-national companies – a large skilled labour pool, a pragmatic, business-friendly and stable business environment, active promotion and incentives, combined with low operating costs and the city’s strong cultural heritage are attracting the attention of both the domestic and international business community. The city has become a favoured destination for IT/ITES activities, with a rapidly growing corporate presence.

Kolkata now has most of the ingredients in place to move its economy up the value-chain – its size, skill base and heritage point to a significantly higher international profile over the long term”.

He further added “Kolkata’s real estate market is set for transformation, and property will play a pivotal role in the city’s continued renaissance. All real estate sectors have significant potential. The growing IT/ITES sector will underpin strong expansion of the office sector; Kolkata is a high priority destination for retailers attracted by its large population and rising disposable incomes; the residential market is expanding on the back of a growing IT/ITES workforce and hotel demand is being boosted by corporate business and tourism. The Kolkata real estate market is now on the radar of leading national and international developers, all keen to participate in Kolkata’s increasingly dynamic real estate market”.

According to the report, Kolkata, whose economy grew by 8% in 2005, is home to 175 IT and ITES firms which employ approximately 40,000 people. Rapid expansion and increased business activity is expected to strongly boost demand for speculative built space as well as built-to-suit offices and 4.5 million sq ft of additional supply is likely to be completed by 2007 in Salt Lake and New Town Rajarhat. The city is also a high priority destination for domestic and international retailers with over 2-3 million sq ft of organized retail under construction by 2008.

Stimulated by the growth of the IT/ITES sector, hotel room demand in Kolkata is expected to grow at an annual 11.7% over the next five years and supply at 15.4% per year. Similarly, Kolkata’s residential demand continues to be strong, as shown by absorption patterns of recent residential demand, which are expected to grow in tandem with economic activity and investor interest.

“Emerging City Winners” is Phase IV of the Jones Lang LaSalle’s World Winning Cities Research, a multi-year programme which draws together the essence of contemporary city competitiveness. World Winning Cities Research examines trends that impact the business and economic landscape, and how these factors are coalescing to create the rising urban stars of the next decade. The research aims to identify the winners and losers among the emerging BRIC cities in India, China, Russia and Brazil.

Contributed By : Hemant Sikaria