The fine difference: Hannover at a glance.

Transcription

1 The fine difference: Hannover at a glance. Property Market Report 2006 Hannover Region Promoting business and jobs

2 Hannover Region Property Market: Striving for the highest quality! This is the fourth report summarising the economic development of the property market in Hannover Region, again prepared using data gathered by BulwienGesa AG. Hannover is undoubtedly one of the outstanding Class B locations (regional locations) in Germany s property market, very close to the Class A locations of Frankfurt/ Main, Hamburg, Munich, Berlin, Düsseldorf, Cologne and Stuttgart. Hannover is strong in all relevant segments, and in terms of key indices such as office and retail properties boasts figures well above the average for B locations. Hannover has carefully adapted its portfolio development in response to the increasing internationalisation perceived in the investment strategies of leading investment corporations. Hannover s positive market development as a property location is perhaps best demonstrated by the following four trends: Several crucial city centre remodelling projects (e.g. Niki-de-Saint-Phalle Promenade, ECE Ernst-August-Platz shopping centre) exemplify a mood of buoyancy, also reflected in the investment decisions of international investors. The willingness of investors to entertain challenging rehabilitation projects, including those demanding high levels of entrepreneurial commitment. The dynamic development in the logistics property market, including new and planned logistics developments in Garbsen (Sonepar) and at the Airport Business Park (bauwo). Exciting retail sector developments also in areas outside of the city centre proper for example the construction of a second IKEA store near Hannover s international exhibition centre, the formation of new neighbourhood shopping centres and the Neue Mitte Garbsen shopping centre (Sonae-Center) together with the continuing development of the Langenhagen/Westfalenstraße retail centre and the new Möbel Höffner furniture store in Altwarmbüchen. 2

3 Index * Location Hannover Region page 4 Right at the front of the second row! 1* * Office Property Market Hannover Region page 8 Superb outlook for offices! 2* * Retail Property Market Hannover Region page 10 Many centres for retailers! 3* * Logistics Property Market Hannover Region page 14 Strong growth at a high level! 4* * Property development in other markets Hannover Region page 18 Special sectors need extra special properties! 5* * Facts and figures Hannover Region page 20 Eyed by investors! 6* 3 All data and analyses contained within this report are based on a survey organised by BullwienGesa AG on behalf of Hannover Region.

4 1* Location Hannover Region * Location at a glance Right at the front of the second row! Hannover Region comprises Hannover, the State Capital, plus 20 towns and municipalities in the surrounding area (including 10 "central places ). Hannover Region s overall population is million, of which 516,000 live in Hannover City. There are around 415,000 people working and paying national insurance contributions in Hannover Region, of which approx. 268,000 work in the State Capital. Hannover is perfectly located at the intersection of the main north-south and east-west transport routes. Giving you fast efficient access to major population centres such as Hamburg, Berlin, the Ruhr, Rhine/Main and Munich. This is true of both roads (A 2/A 7 motorway interchange) and rail (ICE mainline junction): key metropolitan areas like Berlin and Hamburg are less than 2 hours away by high-speed train, while even Munich can be reached within only 4 hours. Hannover Airport complies with top international standards and offers 24/7 air traffic operations. Hannover Region also benefits from having an excellent internal traffic infrastructure, including a modern interurban rail network (S-Bahn) providing rapid links between Hannover City, outlying municipal centres, the airport and the international fair grounds. Major service sector organisations are located in Hannover Region: TUI AG, the global tourism giant, Madsack publishing house and many insurance and financial 4 The 2006 FIFA World Cup helped Hannover confirm its reputation as an exceptional event location. The redevelopment of the AWD football stadium, with its 49,000 crowd capacity, represented a Euro I65 million investment. The AWD-Arena was the venue for five World Cup matches. A total of 1 million people flocked to Hannover during the World Cup.

5 service providers (e.g. Norddeutsche Landesbank, GE Money Bank, ING DiBa, FinanzIT, AWD, Talanx, Hannover Rückversicherung, VGH Versicherungsgruppe Hannover, Concordia, VHV etc.). Many industrial corporations of international status are also at home here, for example Continental AG, WABCO, Varta AG, Volkswagen Commercial Vehicles, Solvay Chemicals, MTU Maintenance, Sennheiser and the Bahlsen Group. Hannover is a frequent host to key international fairs, for example CeBIT, Hannover Industry Fair and IAA Commercial Vehicles. In fact, the world s largest, state-of-the-art fair and exhibition grounds is located on the city s southern border; it was also the venue of the EXPO 2000 World Exposition. Hannover Region is home to many scientific establishments of international standing: Hannover University, Hannover Medical University, Hannover Veterinary College, the International Neuroscience Institute (INI), the German Institute of Rubber Technology, the Max-Planck-Institute for Experimental Endocrinology, Hannover Laser Centre and Hannover Production Engineering Centre. Locational quality Hannover has successfully consolidated its position as a robust B location, even during the recent sluggish economic climate. International investors are attracted by the low volatility of both rents and returns, especially those fund managers seeking to diversify their investment portfolios with locations off the A-location track. Property rents and returns have remained stable at a high level in Hannover. International investment organisations have also been complementing their portfolios with properties across the board, e.g. in office, retail and residential sectors alike. As a result of the increasing internationalisation of investment strategies, it is thought very likely that Hannover will remain an interesting prospect for international investors. Hannover s property market stands for investments boasting safe returns coupled with a good portion of development potential a statement which applies equally to all market sectors. The massive investments made in recent years and the broad scope of urban renewal, in particular at the very heart of the City and the area around Hannover s main railway station, clearly highlight investors' strong faith in Hannover s attractive property market. 5

6 1* * City REINVENTED! Hannover City: a vibrant city Hannover s City Centre has a pulse all of its own, most obvious in the many new attractions added in recent years and the many in the pipeline. The pace of change has been remarkable. Leaving results which people can t help but notice: whereas in 1998 only around 30 % of people in Hannover Region thought Hannover`s City Centre was excellent or good, this value has now risen to over 50 %. The total make-over of Hannover s main station, the Hauptbahnhof, and the station plaza have given the city centre s trademark an amazing new lease of life. The station building itself is now home to the Promenade, with 50 retail outlets on approximately 20,000 sqm retail space. The station is complemented by other projects, like the Ernst-August Carré, completed in 2003 to provide a shopping gallery and offices on an area totalling 6,000 sqm, and the rededication of the Kontorhaus, now a Saturn Hansa media store of approx. 6,500 sqm in size plus storage space and an additional approx. 5,000 sqm offices. The headquarters of Sparda-Bank have recently been totally renewed to complete an impressive ensemble of rejuvenated buildings. What was previously the dark and uninviting Passerelle basement-level pedestrian walkway is now the sparkling and attractive Niki-de-Saint-Phalle Promenade, running from Kröpcke to the main station. This bustling shopping parade boasts 80 retail outlets, is about 600 m in length and features modern steel and glass design elements. 6 The Ernst-August Gallery an outstanding shopping mall of supra-regional importance is being built directly adjacent to the Niki-de-Saint-Phalle Promenade and the main railway station, and is scheduled to open in Autumn Three elegant floors will house 140 specialist retail outlets with approx. 30,000 sqm retail space, and approx. 1,200 parking spaces. ECE expects to attract more than 30,000 visitors a day.

7 Raschplatz is gradually being integrated into the City: Kaufland opened a new selfservice department store here in 2004, complemented by two hotels, offices and medical/legal practices along with more than 1,000 car parking spaces. The station s north side is now the site of the RUND CARRÉ, built in 2005 and offering approx. 4,000 sqm office space together with 4,900 sqm of retail space. The Aegidientorplatz, Aegi, was reborn: the exciting, futuristic architecture of the NORD/LB Headquarters provides approx. 40,000 sqm of space for a mix of offices, businesses and catering establishments: it also marks the starting point of the square s rebirth. The new Torhaus has a glazed front facade which reaches out and seems to float over the underground station entrance: inside, the building offers approximately 7,600 sqm of office and approx. 600 sqm retail space. Developments which have not gone unnoticed by the retail trade: Hannover City Centre has recently seen the opening of several new stores, e.g. Weiland, H&M, Esprit, Mango and others, activities which confirm again and again that Hannover is the place to be. The Joachim Centre with approx. 4,500 sqm of office and approx. 1,000 sqm retail space plus a four-level underground car park just off the station plaza. The new Ernst-August Gallery is currently under construction: in 2008 this project is scheduled to add an additional 140 retail outlets with an area of approx. 30,000 sqm, joined by an additional 1,200 car parking spaces. Kröpcke Center is earmarked for comprehensive redevelopment and expansion. All these ingredients make Hannover a vibrant city with excellent prospects! Georgstraße is one of the most frequented shopping streets in Germany. It boasts attractive retail outlets in modernised properties. The new headquarters of NORD/LB built in 2002 stimulated the complete redevelopment of the Aegidientorplatz square. 7

8 2* Office Property Market Hannover Region * Office properties: Portfolio and planning Superb outlook for offices! Hannover s office property market represents a total space inventory of 3.7 million sqm (according to gif*), including the two neighbouring communities of Laatzen and Langenhagen, south and north of the State Capital respectively, with which many close ties exist. The total building volume during 2006 is estimated at around 65,000 sqm. The volume of new buildings during 2006 is forecast at approximately 50,000 sqm, easily outstripping the two previous years by a wide margin. The location quality of the various sectors in the office market will be consolidated and strengthened overall by the new building activities as well as the renovation projects. The demand for office areas in Hannover is influenced by many owner-occupiers. The economic upturn has boosted the property demand for near-corporate service providers in particular. More than 45,000 sqm had been leased by the end of Q2. The overall figure for 2006 of office space turnover will probably reach around 80,000 sqm. This figure represents a jump of more than 30 % in office space turnover year-on-year (60,000 in 2005). In contrast to office rents in A locations, Hannover s rates have remained basically stable at last year s levels. Current peak rents in the city are around Euro 12.00/sqm. The average rent in the city is Euro 9.50/ sqm, on the margins this dips to Euro 8.50/sqm, touching around Euro 7.25/sqm in peripheral locations while rates in office centres are of the order of Euro 9.00/sqm. Vacancy rates have remained constant at a low level. The current vacancy volume is around 195,000 sqm, with no change on the previous year. The vacancy rate in Hannover was 6.2 % at year-end This figure is much lower than, for example, in Stuttgart (7.4 %) in particular, and is also well below the average for B cities (approx. 8 %). Office space inventory in Hannover Region, at the end of 2005 Total market, Hannover Hannover City Langenhagen and Laatzen GFA sqm 4,323,000 3,908, ,000 Rented sqm (gif) 3,677,000 3,126, ,000 GFA= gross floor area gif = according to Gesellschaft für immobilienwirtschaftliche Forschung (gif e. V.) method 8 *Calculated using a standard defined by Gesellschaft für immobilienwirtschaftliche Forschung (gif) e. V.

9 Office property projects he New office buildings 1 Podbielskistraße Heimkehr office building, Hildesheimer Straße 89 3 Medienzentrum Hannover, 1. BA, Stiftstraße 4 RUND CARRÉ, Hamburger Allee/Rundestraße 5 Richard Kühn-Haus, EXPO Plaza 6 ZooBiz, Plathnerstraße 7 Hannover 96 offices, Arthur-Menge-Ufer 8 Office building, Hildesheimer Straße 98 9 Torhaus am Aegi 10 Business Park Hannover Nord, 2. BA, Vahrenwalder Str./Walter-Bruch-Straße 11 Medienzentrum Hannover, 2. BA, Lange Laube 12 Joachimszentrum, Joachimstraße 13 Office building Hannover Region, Hildesheimer Straße 14 bauwo Business Center 3. BA, Hans-Böckler-Allee 15 Office building Gutenberghof/Berliner Allee 16 EUTC Komatsu, Hanomagstraße 17 Office Building VHV, Günther-Wagner-Allee Redevelopment projects 18 Office building RTL-Shop, Großer Kolonnenweg 19 Office building, Schiffraben Nordstern-Building, Kurt-Schumacher-Straße 21 Office building, Hildesheimer Straße Office building, Krausenstraße/Schlägerstraße 23 Office building, Königstraße/Hamburger Allee New buildings Reorganisation Completed Under construction Advanced planning Tram City boundary City Map data: ATKIS-data of the LGN City outskirts & arterial roads Office centres Peripheral locations Fair Grounds Airport 9

10 3* Retail Property Market Hannover Region * Hannover Region as a retail location Many centres for retailers! The City of Hannover is one of the most successful retail locations in Germany, generating retail sales of around Euro 3.5 billion (CIMA 2006). The retail purchasing power ratio for Hannover is at 105 %. The centrality ratio is well above average at Total retail space in Hannover Region amounts to approximately 1.8 million sqm, of which around 770,000 are in the City of Hannover alone. Hannover is one of the top ten cities in the German rent ranking index (No. 9). The prime Class A sites shrugged off the nationwide trend to boast continuous positive development. The Georgstraße prime site is one of the most important shopping streets in Germany attracting over 8,700 passers-by an hour. Hannover s inner city area has approx. 237,000 sqm of retail space, making it the outstanding shopping centre in the region; most of the centre comprises a contiguous and extensive pedestrian zone. The ranking of top retail streets in Hannover is headed by Georgstraße, followed by Bahnhofstraße, Karmarschstraße and Osterstraße. The huge range of goods available is dominated by well known chains as well as major local and regional operators. Highlights include major department stores like KARSTADT (3 stores) and GALERIA KAUFHOF (2 stores). The clothing sector is represented by big names like C&A, ERDMANN, HEUTELBECK, Mäntelhaus Kaiser, New Yorker, PEEK & CLOPPENBURG and SINN LEFFERS, all with prime Class A locations. Premium merchandise is available from the Galerie Luise, the Ernst-August Carré, Kröpcke- Passage, Luisenstraße, Theaterstraße and Georgstraße (opposite the opera). Bright and friendly design is the hallmark of Hannover s highly popular shopping arcade the Niki-de-Saint- Phalle Promenade which extends from Kröpcke to Raschplatz. The 600 m long shopping arcade has room for 80 retail outlets. 10

11 Shopping in Hannover City Centre 76 % Rent level as percentage of peak value (Euro 150/sqm) Prime Class A areas Class B areas Major stores Arcades Planned projects 1 Ernst-August-Galerie (ECE) 2 Ernst-August-Carré 3 Galerie Luise 4 Kröpcke-Passage 5 Niki-de-Saint-Phalle-Promenade 6 Promenade in the Central Station 7 C & A 8 Conrad Elektronik 9 Erdmann 10 Galeria Kaufhof at the Marktkirche 11 Galeria Kaufhof at E.-August-Pl. 12 Heutelbeck 13 Horstmann+Sander 14 H & M 15 H & M and Esprit 16 I. G. von der Linde 17 Karstadt 18 Karstadt furniture store 19 Karstadt sport 20 Kaufland shopping centre 21 Mäntelhaus Kaiser 22 New Yorker and Olymp&Hades 23 New Yorker 24 Peek & Cloppenburg 25 Saturn 26 Schmorl & von Seefeld 27 Sinn Leffers 28 Sport Scheck 29 Weiland 30 Wormland 31 Zara Map data: ATKIS-Daten of the LGN 11

12 3* The inner-city shopping area will remain the focus of retail development in the City of Hannover. The largest building project is the ECE Ernst-August Galerie Shopping- Center at the station (140 retail outlets, 30,000 sqm retail space, completion date 2008). Traditional neighbourhood centres such as the Lister Meile can be proud of their excellent track record. Retail agglomerations have also formed along the arterial corridors next to tram alignments, above all the Hildesheimer Straße. Major retail areas are also work-inprogress on the city s periphery. IKEA is currently erecting its second store in the region of Hannover at the Hannover Exhibition Grounds, where 19,000 sqm of retail space will open in Autumn Möbel- Höffner intends to commence with the construction of a new furniture store with a planned retail area of 40,000 sqm in Autumn 2006 at the Altwarmbüchen/Lahe retail centre on the site of the erstwhile The city edge municipalities of Laatzen, Möbel-Unger building. A number of restructuring measures to existing objects retail centres of Lahe/Altwarmbüchen, Garbsen and Isernhagen are host to the are also planned in various districts around Leine Center in Laatzen, Nordwest-Zentrum and the power stores on the B 6 in the city, including challenging projects demonstrating considerable entrepreneurial spirit and commitment, such as Linden ture store), the City Centre of Langenha- Garbsen (including MÖBEL HESSE furni- Park (conversion of the Ihme Zentrum in gen and the IKEA store in Großburgwedel: Linden, 19,000 sqm, scheduled to start in all are key retail sites attracting shoppers Summer 2006, completion date 2007). from far beyond their immediate catchment The second IKEA furnishing store in the Hannover Region will be opened on 18 October. The new outlet at the Hannover Exhibition Grounds cost Euro 50 million and has almost 20,000 sqm of retail space on a 54,000 sqm site. 12

13 The Linden Park shopping centre plus shopping mall in the heart of the Linden district, a core catchment area for 45,000 people, is being developed by converting and upgrading the Ihme-Zentrum. A shopping centre with around 30 shops and approx. 10,000 sqm retail space opened at the end of November 2005 on the site of a former sugar factory in the heart of the city of Lehrte. Further development including a senior living community, a nursing home, shops and food outlets are also planned. areas. In these examples, the retail centrality is actually higher than that of Hannover City itself. Other interesting retail locations of importance in the surrounding vicinity include Barsinghausen, Burgdorf, Burgwedel, Langenhagen, Lehrte, Neustadt, Springe and Wunstorf. The Zuckerfabrik Lehrte shopping centre recently opened its doors at the end of 2005 and represents an exciting retail development in the region (a mix of shopping and small commerce with 10,000 sqm retail space), while the Langenhagen-Osttor shopping centre (retail space 3,700 sqm) opened in spring Further large retail plans also exist in Garbsen (Neue Mitte Garbsen, Sonae shopping centre with 19,6000 sqm retail) and Westfalenstraße in Langenhagen (building commences with the Dehner Garden centre, 6,000 sqm retail, in Spring 2006). At a glance: The City Centre is increasingly attracting more and more people from the whole region. And the satellite centres also boast above average growth. 13

14 4* Logistics Property Market Hannover Region * Logistics properties in the spotlight Strong growth at a high level! Logistics sites with Hannover has consolidated its role as a superb logistics location at the intersection of the north-south (A 7 Hamburg South Germany) and east-west (A 2 Rhine Ruhr Berlin) transport routes. Hannover Airport offers state-of-the-art access to the world s airways and is compliant with top international standards thanks to its highcapacity parallel runways and 24 hour operating hours. Hannover Region can also exploit the logistics benefits of having one of Germany s largest shunting yards in Seelze, the Nordhafen tri-modal transhipment facility (truck rail inland shipping) and the transhipment station for combined traffic at Lindener Hafen. This impressive profile is further complemented by many reserve areas offering great future potential. 1. Barsinghausen-Bantorf (approx. 30 ha) 2. Burgwedel/Großburgwedel (approx. 10 ha) 3. Garbsen/westl. Gutenberstr. (approx. 20 ha)* 4. Isernhagen H. B. (approx. 5 ha) 5. Laatzen/Rethen-Ost (approx. 45 ha) 6. Langenhagen/Airport Business Park (approx. 60 ha) 7. Langenhagen/Rehkamp (approx. 5 ha) 8. Langenhagen/Godshorn 9. Lehrte/Ahlten (approx. 7 ha) 14

15 reserve area 10. Lehrte/GVZ (approx. 20 ha) 11. Lehrte/Everner Str. (approx. 9 ha) 12. Lehrte/Immensen 13. LHH/Schwarze Heide (approx. 100 ha) (approx. 25 ha) 14. LHH/Lindener Hafen 15. LHH/Anderten 16. Sehnde-Höver (approx. 25 ha) (approx. 30 ha)* 17. Wedemark/Gailhof (approx. 5 ha) 18. Wunstorf/Gewerbepark Süd (approx.100 ha)* area under development* Business park (The size of the circle corresponds to the area of the site) Hannover Airport Air-Cargo-Center Freight Hub Hannover-Lehrte Hannover Fair Grounds Lindener Hafen port Misburger Hafen port Nordhafen port Brinker Hafen port Seelze marshalling yard Areas available No areas available Map data: ATKIS-data of the LGN 15

16 4* Hannover location is basically the nervecentre in Northern Germany for the forwarding industry. No less than one quarter of the total EU population can be reached within a nine hour shift at the wheel. This adds up to a total market potential of some 90 million people. Hannover is the gateway to the East as well as being the traditional access route to Scandinavia. Recent years have seen Hannover enjoy huge growth rates resulting from the expansion of capacities in transport, storage and logistics service providers including the re-dedication of unwanted production areas. As a consequence of this high growth rate, the logistics sector is responsible for some 30 company locations since 1998, representing an additional 350,000 sqm of logistics space and an investment volume in excess of Euro 450 million. Today s peak rents for premium new buildings in prime positions with excellent connections have remained stable year-onyear at around Euro 5.00/sqm. Rents for logistics properties range between Euro 3.00/sqm and Euro 4.00/sqm depending on location and quality. The most recent project is the expansion of the BSN medical distribution centre in Beiersdorfstraße (adding approx. Sonepar Deutschland is the leading electronics wholesaler in the German market, and its new distribution centre in Garbsen has warehousing covering around 94,000 sqm at a location with superb transport connections and room for further expansion. 16

17 8,000 sqm to make a total of 14,000 sqm high racking warehousing for medical products). This is complemented by, e.g., the new arrival of a textile logistics service provider in Isernhagen-H. B. (29,000 sqm warehousing), the location of a wholesaler for decoration merchandise in Laatzen, Mannheimer Straße (15,000 sqm), the expansion by 7,200 sqm of an electrical merchandise wholesaler and specialist trader in Langenhagen, Bayernstraße, and the construction of a new 4,000 sqm logistics hall by Spedition Ebeling in Gailhof-Wedemark. Sonepar, the electronic wholesale business Sonepar Deutschland provider has started with the construction of its new Northeast central logistics warehouse with a total hall area of 60,000 sqm on a 94,000 sqm plot in Garbsen-Nord (completion date, end 2007). Plans have been presented in Wunstorf for the construction by Neukirch Logistics of a warehousing logistics and service centre in four phases of each 7,500 sqm. Plans are also on hand for the con-struction from 2007 onwards of the bauwo terminal in Langenhagen at the Airport Business Park on a 200,000 sqm site, comprising a hall of approx. 90,000 sqm floor area. BSN medical GmbH & Co. KG, one of the world s leading suppliers of medical products, has expanded its warehouse by around 8,000 sqm to 14,000 sqm. At a glance: Continued strong growth thanks to the "perfect location for distribution companies. New sites available for expansion and company relocations. 17

18 5* Property development in other markets Hannover Region * The other markets in Hannover Region Special sectors need extra special properties! Hannover is superbly located in Northern Germany and is justifiably optimistic about the future. Demographic forecasts predict stable population figures for Hannover Region between now and 2020 unlike many other parts of eastern and south-eastern Lower Saxony. The commercial expansion of tomorrow s dynamic sectors depends on properly co-ordinated business and research. This growth is successfully supported in the region of Hannover by hannoverimpuls, a business promotion company, whose activities are focused on encouraging business in five target sectors: automotive, IT, production engineering, optical technologies and life sciences. Recent years have seen these sectors boosted by a number of investments in, e.g., research and infrastructure facilities. Highlights include the Production Engineering Centre (PZH) in Garbsen, the Laser Academy and the Centre for Vehicle Components and Systems at the Science Park in Marienwerder, the Learning Lab Lower Saxony (L3S) at Expo Park Hannover and the private INI International Neuroscience Institute at Medical Park Hannover. The University of Hannover also intends additional investments in its research infrastructure moving forward. Such investments will also include the grouping together of various engineering and scientific departments into the Laboratory for Nano and Quantum Engineering (LNQE) in the Nordstadt (building scheduled to start in 2007) and expanding the PZH in Garbsen. 18 The Production Engineering Centre Hannover (PZH) is a unique location. Over 400 highly qualified scientists and technicians from all scientific and engineering disciplines work together at PZH with industrial partners on production engineering innovations. A dynamic environment stimulated by combining basic research with industrial development and consulting.

19 The Sunrise Senior Living Community, built with an investment of Euro 25 million, will provide comfortable accommodation in 90 apartments and an assisted living area with sophisticated caring for around 100 senior citizens from May The Königshof specialist medical centre provides healthcare and ancillary services plus geriatric follow-up care in a city centre location with 14,800 sqm rental space. A number of private companies in these sectors propose to strengthen their presence in the region by way of a series of investments for the future as well. For example, Varta Automotive envisages the construction of a production facility for hybrid batteries at its Hannover-Stöcken site, from which location up to 10,000 batteries will leave the production line from mid-2007 onwards. Construction plant manufacturer Komatsu has the intention of establishing a European Technology Center (EUTC) at its Linden- Süd/Hanomagstraße site, involving an investment volume approaching 35 million and the creation of many new jobs. The health industry and the culture industry are also key future sectors. Investment highlights in the health sector include the Königshof Medical Specialist Centre (starting late 2006, completion in 2008, a 22 million investment) near Central Station and the planned construction of Hannover Region s new clinic at the Siloah Hospital in Linden (with restructuring measures including the centralisation of clinic buildings and an investment volume of between Euro 120 and 150 million). In the senior living and care property sector, one outstanding project is the Sunrise Senior Living Community at Zeppelinstraße in the city centre Zoo district; the grand former Oberpostdirektion building is being converted by the international senior living organisation Sunrise to create 90 senior apartments and all the related service facilities (building start: 2006). Prospective investments in the culture industry include the conversion of the former main goods station as a multifunctional event centre, the expansion of the Sprengel Museum on the Maschsee Lake and the Yukon Bay project of Hannover Erlebnis Zoo Worlds of Adventure (22,000 sqm Alaska Adventure World, investment volume approx. 25 million). At a glance: growth sectors are moving increasingly into the region of Hannover. Optimum real estate is readily available and enjoying a marked growth in demand. 19

20 6* Facts and figures Hannover Region Completions, Hannover office market (in 1000 sqm) 03 Completions Forecast 250 Office turnover and vacancies in Hannover Vacancies Office turnover

21 15,0 Office rents in Hannover (in Euro/sqm) 14,0 13,0 12,0 11,0 10,0 9,0 8,0 7,0 6,0 x x x x Peak rents city Average rent, city Average rent office centres x Average rent city, margin Average rent, peripheral 21

22 6* Current facts and figures about Hannover Region s property market Office property market Retail property market Total office employees, 2005 Total office employment rate, 2005 Rental area, office inventory, Hannover office market, 2005 (gif) in sqm 1) 148, % 3.68 million Purchasing power index, retail-relevant (Hannover city) Turnover index (Hannover city) Centrality index (Hannover city) Area turnover, rental, 2005 Area turnover, rental, 2006 (estimated) 60,000 80,000 Retail space, Hannover Region in sqm Of which, Hannover city in sqm 1.8 million sqm 770,000 Vacancies 2005 in sqm 2) 195,000 Of which, Hannover city centre in sqm 237,000 Vacancy rate (gif), ) Office, peak city rent, 2006 in Euro/sqm Office, average city rent, 2006 in Euro/sqm Net initial return in top locations 6.2 % % Retail, peak city rent, Große Packhofstraße, Georgstraße, 2006 in Euro/sqm Retail, average city rent, 2006 in Euro/sqm Net initial return in top-class A locations to 7.7 % Residential property market Logistics property market Housing stock, 2004 in family units Completions, residential space, 2004 Residential rents, new buildings, maximum in Euro/sqm Residential rents, new buildings, average in Euro/sqm Purchasing price for owner-occupied flats, new, average in Hannover City, 2005 in Euro/sqm Purchasing price, owner occupied flats, new, maximum, Hannover City, 2005 in Euro/sqm Turnover transaction volume Residential market 2005 in million Euro 286, , ,000 2, Logistics areas in ha Of which, available immediately in ha Peak rents (new buildings with excellent fixtures and fittings and top location connections (2006) in Euro/sqm Average rent, 2006 in Euro/sqm Net initial return in top locations over 400 approx to to 10 % 1) City of Hannover (3.13 million sqm) as well as Laatzen and Langenhagen (551,000 sqm) 2) Data on vacancies only available for the City of Hannover 22

23 How Hannover City compares with other selected German cities Hannover Bremen Dortmund Nuremberg Stuttgart Population at 30 September 2005 (DO: 30 June 05) 515, , , , ,731 Employed and paying NI, , , , , ,000 Employed and paying NI office, ) 123,138 88,472 77, , ,410 Employed and paying NI office, employment rate, ) 46 % 38.8 % 41.2 % 42.8 % 51.3 % Total employees, ) 386, , , , ,206 Total office employees, ) 148, ,988 98, , ,071 Total office employee rate, ) 38.4 % 33.5 % 33.6 % 36.4 % 46.2 % Unemployment rate, ) 18.1 % 15.4 % 18.1 % 13.1 % 9.9 % Office space inventory, 2005 in sqm 3.13 mn 2.30 mn 2.41 mn 3.18 mn 5.4 mn Area turnover, 2005 in sqm 60,000 84,000 48,000 60, ,000 Vacancies, 2005 in sqm 195, , , , ,000 Vacancy rate, % 5.2 % 5.2 % 7.9 % 7.4 % Peak office rent, city, 2005 in Euro/sqm Average office rent, city, 2005 in Euro/sqm Peak retail rent, city, 2005 in Euro/sqm Purchasing power index, Turnover index, Centrality index, Sources: State Statistical Offices, Federal Employment Office, GfK, surveys and calculations by BulwienGesa AG 1) Provisional estimates by BulwienGesa AG based on data available at time of reporting from Federal Employment Agency 2) Annual average value with respect to all employed persons; due to re-evaluation of data by the Federal Employment Agency in 2005, figures cannot be compared with previous years At a glance: The 2006 figures look good a comparison with other cities in particular highlights the many convincing advantages of Hannover Region. 23

24 Hannover Region Business Enterprise Office Guidance and broking Location information Real estate and property consulting Investment and subsidy advice Crisis contact point Business promotion Solutions for companies Business consulting Stock development and acquisitions Scouting in the state capital administration Business and industrial properties The Business Enterprise Office is open Monday through Friday, 9:00 am to 5:00 pm. Appointments can also be arranged outside normal office hours, please call. The Business Promotion office is open Monday through Friday, 07:30 am to 6:00 pm. You can call us any time on +49 (0) Haus der Wirtschaftsförderung Prinzenstraße Hannover Phone +49 (0) Fax +49 (0) unternehmerbuero@region-hannover.de Fachbereich Wirtschaft Brüderstraße Hannover Phone +49 (0) Fax +49 (0) wirtschaftsfoerderung@hannover-stadt.de 800/2006