Quarter Time National Office Q3/2017

Transcription

1 Savills Research Australia Quarter Time National Office CBD Averages A Grade National Office N.F. Rent N.E. Rent Market Yield IRR Cap. Value Sydney CBD 955 (21.7%) 740 (29.8%) 5.15 (-25bps) 6.90 (-35bps) 18,500 (25.9%) Melbourne CBD 545 (3.8%) 395 (3.9%) 5.40 (-35bps) 6.90 (-10bps) 9,500 (1.1%) Brisbane CBD 540 (10.2%) 290 (11.5%) 6.65 (-10bps) 8.00 (-15bps) 9,000 (9.8%) Perth CBD 565 (0.0%) 295 (0.0%) 7.50 (-25bps) 8.00 (-25bps) 7,900 (3.9%) Adelaide CBD 370 (0.0%) 260 (-5.5%) 7.50 (-50bps) 8.25 (-50bps) 5,000 (6.4%) Canberra Civic 370 (2.8%) 290 (5.5%) 6.40 (-35bps) 8.15 (5bps) 6,800 (19.3%) Note: 12 month change shown in brackets Trends Detailed Sales Activity: $16.228bn 163 Sales ($10m+) Leasing Activity 1,425,535sq m 343Leases (1,000sq m+) Employment m 2.6% growth Please note there have been material changes to this report and some methodologies, please contact Savills should you require explanation. savills.com.au/research

2 Report Contents National Indicator Summary 3 Office Economic Drivers 5 National Sales Activity 6 National Leasing Activity 7 State Indicators and Major Activity New South Wales 8 Victoria 11 Queensland 14 Western Australia 17 South Australia 20 Australian Capital Territory 23 National Head Capital Strategy & Research Chris Freeman cfreeman@savills.com.au View all our reports online at: savills.com.au/research Key State Contacts 25 National CBD Average Yield and IRR vs 10yr Bond Rate 12% 10yr Bond Rate Average CBD Grade A Yield Average CBD Grade A IRR 10% 8% 6% 4% 2% % Source: RBA, Savills Research National CBD A Grade - Average Yield Spread over 10yr Bond Rate and IRR Multiple 600 Yield Premium over 10yr Bond Rate (bps) IRR Multiple of 10yr Bond Rate (RHS) x 4.0-x 3.5-x 3.0-x 2.5-x 2.0-x 1.5-x 1.0-x Source: RBA, Savills Research savills.com.au/research 2

3 Fringe Market Averages A Grade National Office N.F. Rent N.E. Rent Market Yield IRR Cap. Value North Sydney 785 (10.6%) 570 (15.2%) 5.75 (-50bps) 7.25 (-50bps) 12,000 (7.1%) Macquarie Park 360 (1.4%) 255 (4.1%) 6.25 (-50bps) 7.40 (-60bps) 6,000 (11.1%) Parramatta 460 (2.2%) 370 (4.2%) 6.15 (-50bps) 7.25 (-50bps) 7,500 (13.6%) St Kilda 390 (5.4%) 305 (n/c) 6.25 (-65bps) 7.25 (n/c) 5,900 (13.5%) Brisbane Fringe 445 (n/c) 240 (-2.0%) 6.90 (n/c) 8.15 (n/c) 8,400 (n/c) Sunshine Coast 330 (1.5%) 260 (-5.5%) 8.65 (n/c) 9.75 (n/c) 4,300 (2.4%) Gold Coast 325 (n/c) 235 (n/c) 8.50 (n/c) 9.50 (n/c) 4,300 (n/c) West Perth 325 (n/c) 190 (-7.3%) 8.00 (n/c) 8.40 (-50bps) 4,100 (n/c) Adelaide Fringe 345 (n/c) 260 (-5.5%) 7.75 (n/c) 8.65 (n/c) 4,400 (n/c) Note: 12 month change shown in brackets National Face Rents, Effective Rents and Incentive Comparison A Grade Average Net Face ($/sq m) Net Effective Incentive (Net Basis % RHS) 1,200 1, Sydney CBD Melbourne CBD Brisbane CBD Perth CBD Adelaide CBD Canberra Civic North Sydney Macquarie Park Parramatta St Kilda Bris Fringe Sunshine Coast Gold Coast West Perth Adelaide Fringe Canberra non-civic Month Net Effective Rental & Capital Growth A Grade Average 35% 30% 25% 20% 15% 10% 5% % -5% -10% Net Effective Rent Growth Capital Value Growth Sydney CBD Melbourne CBD Brisbane CBD Perth CBD Adelaide CBD Canberra Civic North Sydney Macquarie Park Parramatta St Kilda Bris Fringe Sunshine Coast Gold Coast West Perth Adelaide Fringe Canberra non-civic savills.com.au/research 3

4 Yield and IRR Spread to Bond Rates A Grade Average 12% 10-yr Bond Market Yield IRR 10% 8% 6% 4% 2% % Sydney CBD Melbourne CBD Brisbane CBD Perth CBD Adelaide CBD Canberra Civic North Sydney Macquarie Park Parramatta St Kilda Bris Fringe Sunshine Coast Gold Coast West Perth Adelaide Fringe Canberra non-civic Typical Capital Value Range ($/sq m) A Grade Average 25,000 20,000 15,000 10,000 5,000 0 Sydney CBD Melbourne CBD Brisbane CBD Perth CBD Adelaide CBD Canberra Civic North Sydney Macquarie Park Parramatta St Kilda Bris Fringe Sunshine Coast Gold Coast West Perth Adelaide Fringe Canberra non-civic Capital Value CAGRs by Period A Grade Average (Historic) Effective Rental CAGRs by Period A Grade Average (Historic) 30% 1yr 3yr CAGR 5yr CAGR 10yr CAGR 25% 20% 15% 10% 5% 0% -5% 35% 30% 25% 20% 15% 10% 5% 0% -5% -10% -15% 1yr 3yr CAGR 5yr CAGR 10yr CAGR -10% Note: CAGR = Compound Annual Growth Rate -20% Sydney CBD Melbourne CBD Brisbane CBD Perth CBD Adelaide CBD Canberra Civic savills.com.au/research 4

5 Office Sector Economic Drivers Net Absorption vs. Growth in Prof. Job Advertisements Annual Growth in Professional Job Advertisements - % (to Aug-17) 500, , , ,000 Sydney CBD Melbourne CBD Brisbane CBD Perth CBD Adelaide CBD Canberra 50% Prof. Job Ads 40% 30% 20% 10% SA ACT VIC QLD 4.4% 4.4% 4.0% 11.4% 100,000 - (100,000) (200,000) (300,000) 0% (10%) (20%) (30%) (40%) (50%) AUS NSW WA TAS NT -11.5% -1.6% -2.2% 2.1% 0.0% Note: Net Absorption to Jun-17, Job Adverts to Jun-17 Annual Growth in Employment Annual Growth in Employment by State - % (to Aug-17) 400,000 F/T Employed P/T Employed TAS 4.0% 300,000 QLD 3.7% 200,000 VIC WA 2.6% 3.2% 100,000 AUS 2.6% - SA 1.8% (100,000) NSW ACT 1.0% 1.6% (200,000) NT -1.7% Note: CAGR = Compound Annual Growth Rate Summary of State Economic Indicators Key State Indicators (%) Latest NSW VIC QLD WA SA ACT AUS SFD / GDP Growth Jun (2.7) 4.7 (2.8) 2.8 (1.7) -4.3 (1.7) 4.0 (2.0) 1.3 (3.2) 1.8 (2.5) Population Growth Mar (1.4) 2.4 (2.1) 1.6 (1.9) 0.7 (2.1) 0.6 (0.9) 1.8 (1.9) 1.6 (1.7) Employment Growth Aug (1.5) 3.2 (2.0) 3.7 (1.4) 2.6 (2.0) 1.8 (0.8) 1.0 (1.0) 2.6 (1.6) Unemployment Rate Aug (5.3) 6.0 (5.6) 6.2 (5.6) 6.0 (4.8) 6.6 (6.0) 4.0 (3.8) 5.7 (5.4) CPI (Inflation) Jun (2.4) 2.2 (2.4) 1.8 (2.5) 0.7 (2.2) 1.6 (2.3) 2.1 (2.2) 1.9 (2.4) Job Adverts (Prof) Aug (-3.3) 8.0 (-1.9) 0.4 (-4.8) 4.9 (-5.4) 12.0 (-3.8) 4.9 (2.2) 2.2 (-3.2) Job Adverts (Total) Aug (-2.9) 4.4 (-3.1) 4.0 (-6.5) -1.6 (-5.8) 11.4 (-6.3) 4.4 (1.8) 2.1 (-4.1) Source: ABS / DOE / Savills Note: Annual change shown, 10yr compound average in brackets savills.com.au/research 5

6 National Sales Activity Reported Transaction Activity Sales $10m+ $20bn NSW VIC QLD WA SA ACT $18bn $16bn $14bn $12bn $10bn $8bn $6bn $4bn $2bn $0bn 100% 80% 60% 40% 20% 0% Purchasers Fund Developer Government Foreign Investor Other Vendors Trust Owner Occupier Syndicate Private Investor Top Recent 15 Sales by Value ($m) Collins St, Melbourne, VIC (50.0%) - Jul-17 - $12,245/sq m Swire House, NSW - Sep-17 - $19,447/sq m Westralia Square, WA - Aug-17 - $6,626/sq m 400 George St, Brisbane, QLD (50.0%) - Jul-17 - $9,657/sq m Hudson House, NSW - Sep-17 - $16,801/sq m Sydney Plaza, NSW - Jul-17 - $8,142/sq m 417 St Kilda Rd, Melbourne, VIC - Aug-17 - $7,172/sq m Northpoint, NSW - Jul-17 - $15,854/sq m 160 Ann St, Brisbane, QLD - Jul $7,476/sq m 990 La Trobe St, Docklands, VIC - Aug-17 - $8,844/sq m 390 St Kilda Rd, Melbourne, VIC - Aug-17 - $6,000/sq m Macquarie Corporate Park Stg 2, NSW - Aug-17 - $7,942/sq m Enterprise House, NSW - Jul-17 - $18,951/sq m 121 King William St, Adelaide, SA - Jul-17 - $4,643/sq m Hatch Building, WA - Aug-17 - $5,273/sq m 8 West Street, North Sydney, NSW - Jul-17 - $9,034/sq m 165 Walker St, North Sydney, NSW - Aug-17 - $10,750/sq m 226 Adelaide Tce, Perth, WA - Jul-17 - $3,789/sq m Waterloo St, Surry Hills, NSW - Sep-17 - $7,466/sq m Waterloo Junction, QLD - Sep $7,167/sq m Top Recent 15 Sales by $/sq m 19,447 18,951 16,801 16,692 15,924 15,854 12,245 10,750 10,157 9,657 9,248 9,034 8,877 8,844 8,142 7,942 7,730 7,476 7,466 7,172 Swire House, NSW - Sep-17 - $270.05m Enterprise House, NSW - Jul-17 - $60.00m Hudson House, NSW - Sep-17 - $165.87m Cyclone House, VIC - Sep-17 - $6.71m Concierge House, NSW - Sep-17 - $25.00m Northpoint, NSW - Jul-17 - $134.00m 447 Collins St, Melbourne, VIC (50.0%) - Jul-17 - $300.00m 165 Walker St, North Sydney, NSW - Aug-17 - $55.90m Regent St, Chippendale, NSW - Jun-17 - $38.82m 400 George St, Brisbane, QLD (50.0%) - Jul-17 - $210.00m 426 Church St, Parramatta, NSW - Jul-17 - $30.00m 8 West Street, North Sydney, NSW - Jul-17 - $58.00m Russell St, Melbourne, VIC - Jul-17 - $23.00m 990 La Trobe St, Docklands, VIC - Aug-17 - $114.50m Sydney Plaza, NSW - Jul-17 - $158.00m Macquarie Corporate Park Stg 2, NSW - Aug-17 - $95.30m Connect Corporate Centre (Building 1), NSW - Jul Ann St, Brisbane, QLD - Jul $119.50m Waterloo St, Surry Hills, NSW - Sep-17 - $52.67m 417 St Kilda Rd, Melbourne, VIC - Aug-17 - $144.40m savills.com.au/research 6

7 National Leasing Activity Reported Leasing Activity Leases 1,000sq m+ 2,000,000 SYD MEL BRI PER ADL CAN 1,800,000 1,600,000 1,400,000 1,200,000 1,000, , , , ,000 Retail & W'Sale 50,342sqm - 3.6% Mining & Util. 114,241sqm - 8.1% IT & Comm 203,930sqm % Business Serv. 265,567sqm % Fin & Ins 333,430sqm % Govt. 386,190sqm % Leasing Composition by Type Leases 1,000sq m+ Leasing Composition by Grade Leases 1,000sq m+ Direct - 786,388sqm % P - 253,616sqm % Precom - 430,047sqm % A - 836,337sqm % Renewal - 202,126sqm % B - 179,277sqm % Sublease - 39,993sqm - 2.7% C - 51,128sqm - 3.9% Assignment - 1,239sqm - 0.1% D - 1,384sqm - 0.1% Top 20 Recent Leases 1,000sq m+ 4,750 4,320 4,000 4,000 3,433 3,149 3,079 2,940 2,888 2,843 Precom Direct & Other 2,652 2,574 2,548 2,179 2,015 2,000 1,954 1,952 1,936 1,903 Aust. Inst. of Comp. Directors, NSW Kone, NSW Trade Secret, NSW Stanwell Corporation, QLD IRESS Market Technology, NSW Jardine Lloyd Thompson, NSW Adobe Systems, NSW Dimenson Data, NSW Treasury Corp, NSW Toll Holdings, VIC CoCo Republic, QLD Optus, QLD NBN Co, QLD Boston Scientific, NSW APT Management Services, NSW APA Group, NSW Spruson & Ferguson, NSW Dermamed Skin Clinic, VIC Euclideon Unlimited, QLD Expedia, QLD savills.com.au/research 7

8 New South Wales PCA OMR Statistics (Jun-17) Sydney CBD North Sydney Parramatta Macquarie Park AUS CBD Total Stock 5,086, , , ,693 18,018,735 Total Vacancy 298,248 52,734 30,027 74,052 1,772,892 Vacancy (%) 5.9 (7.2) 6.4 (9.0) 4.3 (7.7) 8.5 (9.0) 10.5 (8.6) Net Absorption (12m) -7,727 (30,382) 32,883 (2,823) 24,334 (11,800) -20,823 (28,843) 188,097 (199,008) Net Absorption (%) -0.2 (0.7) 4.5 (0.4) 3.7 (1.9) -2.5 (4.6) 1.2 (1.3) Stock Additions 205,794 45,132 26,000 19, ,708 Stock Withdrawals 201,480 15,118 2,137 28, ,381 Net Additions 8,064 (33,345) 30,014 (1,349) 23,863 (9,831) -9,674 (31,887) 125,453 (325,578) Net Additions (%) 0.2 (0.7) 3.8 (0.2) 3.5 (1.5) -1.1 (4.6) 0.7 (2.0) Source: PCA / Savills Research Note: 10yr Average shown in brackets Sydney CBD Key Indicators Sydney CBD Premium A Grade B Grade Low High Low High Low High Rental Gross Face ($/sq m) 1,150 1,470 1,100 1, Rental Net Face ($/sq m) 940 1, Incentive Level Gross 18% 21% 17% 21% 16% 21% Rental Net Effective ($/sq m) Outgoings Operating ($/sq m) Outgoings Statutory ($/sq m) Outgoings Total ($/sq m) Typical Lease Term Yield Market (% Net Face Rental) IRR (%) Cars Permanent Reserved ($/pcm) 990 1, , Office Capital Values ($/sq m) 21,500 23,500 17,600 19,400 13,500 15,000 savills.com.au/research 8

9 North Shore Key Indicators North Shore North Sydney A Grade North Sydney B Grade Macquarie Park A Grade Low High Low High Low High Rental Gross Face ($/sq m) Rental Net Face ($/sq m) Incentive Level Net 25% 30% 25% 30% 25% 33% Rental Net Effective ($/sq m) Outgoings Operating ($/sq m) Outgoings Statutory ($/sq m) Outgoings Total ($/sq m) Typical Lease Term Yield Market (% Net Face Rental) IRR (%) Cars Permanent Reserved ($/pcm) Cars Permanent ($/pcm) na na Office Capital Values ($/sq m) 10,500 13,500 9,500 11,000 5,000 7,000 Parramatta Key Indicators Parramatta A Grade B Grade Low High Low High Rental Gross Face ($/sq m) Rental Net Face ($/sq m) Incentive Level Net 18% 23% 20% 25% Rental Net Effective ($/sq m) Outgoings Operating ($/sq m) Outgoings Statutory ($/sq m) Outgoings Total ($/sq m) Typical Lease Term Yield Market (% Net Face Rental) IRR (%) Cars Permanent Reserved ($/pcm) Cars Permanent ($/pcm) Office Capital Values ($/sq m) 7,000 8,000 5,000 7,000 savills.com.au/research 9

10 Top 15 Recent Sydney Sales (by Sale Price) Property Price ($m) Date NLA (sq m) Yield Type $/sq m 19 Martin Pl (MLC Centre), Sydney (50%) Jun-17 77, r 18, Bridge St, Sydney Apr-17 19, e 17, Harris St, Pyrmont Jun-17 26, r 12, Pitt St (Telstra Plaza), Sydney May-17 29, e 9, Waterloo St, Surry Hills Sep-17 13, r 19, Phillip St, Parramatta May-17 25, r 9, Goulburn St, Sydney Jul-17 19, e 8, Miller St (Northpoint), North Sydney Jul-17 8, i 15, Waterloo Rd, Macquarie Park Jan-17 10,415 n.a dev 11, Epping Rd (Avaya House), Macquarie Park Dec-16 16, i 7,303 8 Khartoum Rd, Macquarie Park Aug-17 12, r 7,942 2 Richardson Rd, North Ryde Jan-17 15, i 5, George St, Sydney Jun-17 7,357 n.a dev 11,248 2 Elizabeth Pl, North Sydney Mar-17 7, i 10, Walker St, North Sydney Aug-17 5, r 10,750 Yield Types: i = Initial, r = Reported, e = Equated, v = Vacant, dev = development; * Includes >$30 m in compensation beyond market value. Top 15 Recent Sydney Leases (by Area Leased) Property Tenant Date NLA (sq m) Type Rent Term 201 Sussex St, Sydney IAG Jun-17 34,394 Direct 835 (N) Mount St, North Sydney NBN Aug-17 20,000 Direct 750 (N) York St, Sydney Sydney Startup Hub Aug-17 17,244 Direct 835 (G) 7 27 Argyle St, Parramatta RTA Jul-17 10,924 Renewal 262 (N) Barangaroo Av, Sydney Baker McKenzie Jun-17 7,500 Direct 1,400 (G) Martin Pace, Sydney Henry Davis York Sep-17 7,258 Direct 1,130 (G) George St, Sydney Aust. Inst. of Comp. Directors Sep-17 4,750 Direct 995 (G) n.a O'Riordan Street, Mascot Kone Sep-17 4,320 Direct 365 (n.a) O'Riordan Street, Mascot Trade Secret Sep-17 4,000 Direct 415 (n.a) 5 10 Shelley St, Sydney IRESS Market Technology Sep-17 3,433 Direct 654 (G) George St, Sydney Jardine Lloyd Thompson Sep-17 3,149 Direct 1,215 (n.a) Sussex St, Sydney Adobe Systems Sep-17 3,079 Direct 1,010 (N) Sussex St, Sydney Dimenson Data Sep-17 2,940 Direct 920 (N) Phillip St, Sydney Treasury Corp Sep-17 2,888 Direct 910 (N) George St, Sydney Atlassian Aug-17 2,538 Direct 925 (N) 4 Leasing Types: p = Pre-commitment, d = Direct, s = Sub-Lease, r = Renewal savills.com.au/research 10

11 Victoria PCA OMR Statistics (Jun-17) Melbourne CBD St Kilda Rd Southbank East Melbourne AUS CBD Total Stock 4,550, , , ,461 18,018,735 Total Vacancy 294,562 75,225 13,389 5,863 1,772,892 Vacancy (%) 6.5 (6.6) 11.3 (10.5) 3.3 (6.7) 3.3 (2.9) 10.5 (8.6) Net Absorption (12m) 128,389 (75,914) -27,751 (-10,388) -4 (3,028) 230 (644) 188,097 (199,008) Net Absorption (%) 3.1 (2.0) -4.5 (-1.6) 0.0 (0.8) 0.1 (0.4) 1.2 (1.3) Stock Additions 166,974-22,444 7, ,708 Stock Withdrawals 57,334 18,894 29,894 3, ,381 Net Additions 109,640 (83,778) -18,894 (-9,434) -7,450 (2,732) 3,500 (276) 125,453 (325,578) Net Additions (%) 2.5 (2.1) -2.8 (-1.3) -1.8 (0.7) 2.0 (0.2) 0.7 (2.0) Source: PCA / Savills Research Note: 10yr Average shown in brackets Melbourne CBD Key Indicators Melbourne CBD (City Core) Premium A Grade B Grade Low High Low High Low High Rental Gross Face ($/sq m) Rental Net Face ($/sq m) Incentive Level Gross 24% 28% 25% 30% 22% 26% Rental Net Effective ($/sq m) Outgoings Operating ($/sq m) Outgoings Statutory ($/sq m) Outgoings Total ($/sq m) Typical Lease Term Yield Market (% Net Face Rental) IRR (%) Cars Permanent Reserved ($/pcm) Cars Permanent ($/pcm) Office Capital Values ($/sq m) 8,500 14,000 7,000 12,000 6,000 8,500 savills.com.au/research 11

12 Melbourne St Kilda Rd Key Indicators Melbourne St Kilda Rd A Grade B Grade Low High Low High Rental Gross Face ($/sq m) Rental Net Face ($/sq m) Incentive Level Gross 19% 24% 15% 20% Rental Net Effective ($/sq m) Outgoings Operating ($/sq m) Outgoings Statutory ($/sq m) Outgoings Total ($/sq m) Typical Lease Term Yield Market (% Net Face Rental) IRR (%) Cars Permanent Reserved ($/pcm) Office Capital Values ($/sq m) 5,000 6,750 4,500 5,500 Melbourne Suburban Key Indicators Melbourne Suburban A Grade B Grade Low High Low High Rental Gross Face ($/sq m) Rental Net Face ($/sq m) Incentive Level Gross 15% 20% 20% 25% Rental Net Effective ($/sq m) Outgoings Operating ($/sq m) Outgoings Statutory ($/sq m) Outgoings Total ($/sq m) Typical Lease Term Yield Market (% Net Face Rental) IRR (%) Cars Permanent Reserved ($/pcm) Office Capital Values ($/sq m) 6,100 7,600 4,500 5,500 savills.com.au/research 12

13 Top 15 Recent Melbourne Sales (by Sale Price) Property Price ($m) Date NLA (sq m) Yield Type $/sq m 839 Collins St, Melbourne Jan-17 39, i 10, Collins St (Older Fleet), Melbourne (50%) Jun-17 58, e 14, Spencer St, Melbourne (50%) Jun-17 65, e 10, Collins St (Collins Arch), Melbourne (50%) Jul-17 49,000 n.a n.a 12, Queen St, Melbourne Dec-16 36, e 7, Siddeley St (WTC), Melbourne Feb-17 53, i 5, Spencer St (Esso House), Melbourne Jun-17 32,217 n.a n.a 7, Bourke St (QBE House), Melbourne Jun-17 24, e 7, Riverside Quay, Melbourne Dec-16 21,000 n.a n.a 7, St Kilda Rd, Melbourne Aug-17 20, e 7, Collins St, Docklands (50%) Jun-17 26, r 10, La Trobe St, Docklands Aug-17 12, e 8, St Kilda Rd, Melbourne Aug-17 16, e 6, Blackburn Rd, Mt Waverley Jun-17 22,000 n.a n.a 3, Elizabeth St (RMIT Building), Melbourne Nov-16 13, e 5,487 Yield Types: i = Initial, r = Reported, e = Equated, v = Vacant, dev = development Top 15 Recent Melbourne Leases (by Area Leased) Property Tenant Date NLA (sq m) Type Rent Term 60 Cremorne St, Cremorne Seek Aug-17 19,300 Precom n.a n.a. 2 Kendall St, Williams Landing Target Australia Jul-17 12,919 Precom n.a Collins St, Melbourne Accenture Feb-17 8,000 Direct 500 (N) Lonsdale St, Melbourne Cambridge International Feb-17 7,837 Direct 400 (N) Elizabeth St, Melbourne Allianz Australia Services Apr-17 7,260 Renewal n.a Exhibition St, Melbourne Melbourne University Feb-17 6,528 Direct 380 (N) 6 54 Wellington St, Melbourne Aesop Mar-17 5,828 Precom 430 (N) Ferntree Gully Rd, Mt Waverley Monash University Jul-17 4,800 Direct n.a n.a. 109 Burwood Rd, Hawthorn Orora Limited Apr-17 4,358 Direct n.a St Kilda Rd, Melbourne WPP Feb-17 3,800 Renewal n.a St Kilda Rd, Melbourne Toll Holdings Sep-17 2,843 Direct 270 (N) n.a. 333 Collins St, Melbourne Programmed Group Feb-17 2,800 Direct n.a 5 1 Nicholson St, East Melbourne Ixom Apr-17 2,750 Direct n.a Church St, Cremorne Disney Aug-17 2,657 Direct n.a Collins St, Docklands Pacific Hydro Feb-17 2,423 Direct 450 (N) 10 Leasing Types: p = Pre-commitment, d = Direct, s = Sub-Lease, r = Renewal savills.com.au/research 13

14 Queensland PCA OMR Statistics (Jun-17) Brisbane CBD Brisbane Fringe Gold Coast Sunshine Coast AUS CBD Total Stock 2,279,725 1,219, , ,841 18,018,735 Total Vacancy 357, ,385 52,984 10,283 1,772,892 Vacancy (%) 15.7 (10.8) 14.4 (10.4) 11.3 (17.1) 6.9 (11.7) 10.5 (8.6) Net Absorption (12m) 41,749 (18,345) -4,508 (23,815) 10,252 (6,386) 3,448 (13,856) 188,097 (199,008) Net Absorption (%) 2.2 (1.0) -0.4 (2.6) 2.5 (1.7) 2.6 (n.a) 1.2 (1.3) Stock Additions 75,853 23,800 7, ,708 Stock Withdrawals 58,006 21,477 11, ,381 Net Additions 17,847 (52,080) 2,323 (40,313) -4,402 (9,822) (14,884) 125,453 (325,578) Net Additions (%) 0.8 (2.6) 0.2 (4.1) -0.9 (2.4) 0.0 (n.a) 0.7 (2.0) Source: PCA / Savills Research Note: 10yr Average shown in brackets Brisbane Key Indicators Brisbane CBD Premium A Grade B Grade Low High Low High Low High Rental Gross Face ($/sq m) Rental Net Face ($/sq m) Incentive Level Gross 30% 38% 32% 40% 35% 42% Rental Net Effective ($/sq m) Outgoings Operating ($/sq m) Outgoings Statutory ($/sq m) Outgoings Total ($/sq m) Typical Lease Term Yield Market (% Net Face Rental) IRR (%) Cars Permanent Reserved ($/pcm) Cars Permanent ($/pcm) Office Capital Values ($/sq m) 10,750 13,500 7,000 11,000 4,500 7,000 savills.com.au/research 14

15 Brisbane Fringe Key Indicators Brisbane Fringe A Grade B Grade Low High Low High Rental Gross Face ($/sq m) Rental Net Face ($/sq m) Incentive Level Gross 25% 30% 35% 45% Rental Net Effective ($/sq m) Outgoings Operating ($/sq m) Outgoings Statutory ($/sq m) Outgoings Total ($/sq m) Typical Lease Term Yield Market (% Net Face Rental) IRR (%) Cars Permanent Reserved ($/pcm) Cars Permanent ($/pcm) na na Office Capital Values ($/sq m) 5,750 11,000 3,500 9,000 Gold Coast/Sunshine Coast Key Indicators Gold Coast/Sunshine Coast Gold Coast Sunshine Coast Low High Low High Rental Gross Face ($/sq m) Rental Net Face ($/sq m) Incentive Level Gross 15% 27% 15% 20% Rental Net Effective ($/sq m) Outgoings Operating ($/sq m) Outgoings Statutory ($/sq m) Outgoings Total ($/sq m) Typical Lease Term Yield Market (% Net Face Rental) IRR (%) Cars Permanent Reserved ($/pcm) na na Office Capital Values ($/sq m) 3,000 5,500 3,000 5,500 savills.com.au/research 15

16 Top 15 Recent Brisbane Sales (by Sale Price) Property Price ($m) Date NLA (sq m) Yield Type $/sq m One One One Eagle St, Brisbane Dec-16 63, e 13, George St (50%), Brisbane Jul-17 43, e 9, Queen St, Brisbane Nov-16 19, e 7, Ann St, Brisbane Mar-17 25, e 5, Edward Street, Brisbane Jun-17 15, e 9, King St, Fortitude Valley Jan-17 14, e 9, Ann St, Brisbane Jul-17 15, e 7, Wickham St (HQ South), Fortitude Valley Jun-17 14, e 8, Sandgate Rd (Energex Building), Nundah Mar-17 12, e 8,186 Bundall Corporate Centre, Bundall Apr-17 19, i 4, Queen St, Brisbane May-17 13, e 5, Charlotte St (Health & Forestry House), Brisbane Apr-17 26,782 n.a n.a 2, Tank Street, Brisbane Apr-17 6, e 9, Boundary Street, South Brisbane Dec-16 8, e 6, Commercial Rd, Newstead Aug-17 6, e 7,167 Yield Types: i = Initial, r = Reported, e = Equated, v = Vacant, dev = development Top 15 Recent Brisbane Leases (by Area Leased) Property Tenant Date NLA (sq m) Type Rent Term 275 George St, Brisbane Telstra Jan-17 28,464 Renewal 827 (G) Ann St, Brisbane Origin Energy Mar-17 16,350 Direct 765 (G) Ann St, Brisbane Telstra Jan-17 10,665 Renewal n.a Wickham St, Fortitude Valley State of Queensland (ehealth) Jan-17 8,695 Renewal 525 (G) Queen St, Brisbane Westpac Dec-16 5,668 Renewal n.a Ann St, Brisbane Stanwell Corporation Aug-17 4,000 Direct 665 (G) St Pauls Tce, Fortitude Valley Cardno Dec-16 4,000 Renewal n.a Ann St, Brisbane Stanwell Corporation Apr-17 3,500 Direct n.a n.a. 111 Eagle St, Brisbane Allianz Global Jun-17 3,001 Sublease 575 (G) Campbell Street, Bowen Hills State of Queensland Aug-17 2,873 Direct 440 (G) Eagle St, Brisbane QTC Jun-17 2,832 Sublease 875 (G) Campbell Street, Bowen Hills Siemens Aug-17 2,668 Renewal 465 (G) Wickham Street, Fortitude Valley CoCo Republic Aug-17 2,652 Renewal 377 (N) Corporate Drive, Cannon Hill Optus Aug-17 2,574 Direct 415 (G) 5 19 Corporate Drive, Cannon Hill NBN Co Aug-17 2,548 Direct 450 (G) 4 Leasing Types: p = Pre-commitment, d = Direct, s = Sub-Lease, r = Renewal savills.com.au/research 16

17 Western Australia PCA OMR Statistics (Jun-17) Perth CBD West Perth AUS CBD Total Stock 1,768, ,061 18,018,735 Total Vacancy 372,997 63,731 1,772,892 Vacancy (%) 21.1 (10.2) 15.0 (7.6) 10.5 (8.6) Net Absorption (12m) 13,126 (12,357) -3,064 (45) 188,097 (199,008) Net Absorption (%) 0.9 (0.9) -0.8 (0.0) 1.2 (1.3) Stock Additions 5,842 2, ,708 Stock Withdrawals 5,022 4, ,381 Net Additions 820 (48,769) -1,494 (6,268) 125,453 (325,578) Net Additions (%) 0.0 (3.3) -0.4 (1.6) 0.7 (2.0) Source: PCA / Savills Research Note: 10yr Average shown in brackets Perth CBD Key Indicators Perth CBD Premium A Grade B Grade Low High Low High Low High Rental Gross Face ($/sq m) Rental Net Face ($/sq m) Incentive Level Net 45% 50% 45% 50% 45% 55% Rental Net Effective ($/sq m) Outgoings Operating ($/sq m) Outgoings Statutory ($/sq m) Outgoings Total ($/sq m) Typical Lease Term Yield Market (% Net Face Rental) IRR (%) Cars Permanent Reserved ($/pcm) Cars Permanent ($/pcm) Office Capital Values ($/sq m) 8,500 12,500 6,750 9,000 4,750 6,500 savills.com.au/research 17

18 West Perth Key Indicators West Perth A Grade B Grade Low High Low High Rental Gross Face ($/sq m) Rental Net Face ($/sq m) Incentive Level Gross 38% 48% 38% 48% Rental Net Effective ($/sq m) Outgoings Operating ($/sq m) Outgoings Statutory ($/sq m) Outgoings Total ($/sq m) Typical Lease Term Yield Market (% Net Face Rental) IRR (%) Cars Permanent Reserved ($/pcm) Cars Permanent ($/pcm) Office Capital Values ($/sq m) 2,950 5,300 2,400 3,300 savills.com.au/research 18

19 Top 10 Recent Perth Sales ( by Sale Price) Property Price ($m) Date NLA (sq m) Yield Type $/sq m Westralia Square, Perth Aug-17 32, e 6,626 Quadrant, Perth Aug-17 23, e 7, St Georges Tce, Perth Jun-17 13, e 5,167 Workzone East, Perth Jan-17 12, e 5,521 Hatch Building, Perth Aug-17 11, e 5, Adelaide Tce, Perth* Jul-17 14,409 n.a n.a 3, Stirling St (Telstra Building), Perth Dec-16 19,775 n.a n.a 1, Colin St, West Perth Jul-17 8, i 3, Parkland Rd, Herdsman May-17 4, e 5, Thomas St ( & 1 West St), West Perth Mar-17 3,935 n.a n.a 5, Kings Park Rd, West Perth Feb-17 4, e 3, Adelaide Tce (& 20 Bennett St), East Perth Feb-17 2,475 n.a n.a 6, Civic Blvd, Rockingham Jun-17 3, i 3, Newcastle St, Leederville Jun-17 3,105 n.a n.a 4, Coolamon Blvd, Ellenbrook 8.10 Apr-17 1, i 5,287 Yield Types: i = Initial, r = Reported, e = Equated, v = Vacant, dev = development; * part of a portfolio sale Top 15 Recent Perth Leases (by Area Leased) Property Tenant Date NLA (sq m) Type Rent Term 2 Newman Crt, Fremantle State Government Nov-16 17,200 Precom 457 (N) St Georges Tce, Perth Inpex Nov-16 13,379 Renewal 660 (N) Wellington St, West Perth Commonwealth of Australia (Australian Border Force) Nov-16 11,973 Renewal 467 (N) St Georges Tce, Perth Quadrant Energy Nov-16 7,081 Renewal 615 (N) Colin St, West Perth IAG Jul-17 6,967 Renewal n.a St Georges Tce, Perth KPMG Dec-16 6,902 Renewal 675 (N) Murray St, Perth Titan ICT Jul-17 4,080 Direct 425 (N) Murray St, West Perth Commonwealth of Australia Dec-16 3,984 Direct n.a 3 45 Francis St, Northbridge Minister for Works Feb-17 3,413 Direct 515 (N) St Georges Tce, Perth Telstra Feb-17 3,316 Direct 630 (N) Parkland Rd, Herdsman Decmil Group May-17 3,285 Leaseback 365 (N) St Georges Tce, Perth Link Market Services Nov-16 3,166 Direct 685 (N) St Georges Tce, Perth Chevron Nov-16 3,029 Direct 425 (N) Hay St, West Perth MSP Engineering Mar-17 2,568 Sublease 340 (G) 2 25 Rowe Ave, Rivervale Honeywell Aug-17 2,500 Direct n.a 5 Leasing Types: p = Pre-commitment, d = Direct, s = Sub-Lease, r = Renewal savills.com.au/research 19

20 South Australia PCA OMR Statistics (Jun-17) Adelaide CBD Adelaide Fringe AUS CBD Total Stock 1,424, ,850 18,018,735 Total Vacancy 229,795 21,789 1,772,892 Vacancy (%) 16.1 (10.0) 10.1 (6.9) 10.5 (8.6) Net Absorption (12m) 6,016 (9,454) 2,045 (311) 188,097 (199,008) Net Absorption (%) 0.5 (0.8) 1.1 (0.2) 1.2 (1.3) Stock Additions 24,048 3, ,708 Stock Withdrawals 5,280 3, ,381 Net Additions 18,768 (23,547) 441 (2,223) 125,453 (325,578) Net Additions (%) 1.3 (1.8) 0.2 (1.1) 0.7 (2.0) Source: PCA / Savills Research Note: 10yr Average shown in brackets Adelaide CBD Key Indicators Adelaide CBD Premium A Grade B Grade Low High Low High Low High Rental Gross Face ($/sq m) Rental Net Face ($/sq m) Incentive Level Net 25% 30% 25% 35% 30% 40% Rental Net Effective ($/sq m) Outgoings Operating ($/sq m) Outgoings Statutory ($/sq m) Outgoings Total ($/sq m) Typical Lease Term Yield Market (% Net Face Rental) IRR (%) Cars Permanent Reserved ($/pcm) Cars Permanent ($/pcm) Office Capital Values ($/sq m) 5,250 7,350 4,125 5,850 2,500 4,000 savills.com.au/research 20

21 Adelaide Fringe Key Indicators Adelaide Fringe A Grade B Grade Low High Low High Rental Gross Face ($/sq m) Rental Net Face ($/sq m) Incentive Level Net 20% 30% 20% 35% Rental Net Effective ($/sq m) Outgoings Operating ($/sq m) Outgoings Statutory ($/sq m) Outgoings Total ($/sq m) Typical Lease Term Yield Market (% Net Face Rental) IRR (%) Cars Permanent Reserved ($/pcm) Cars Permanent ($/pcm) Office Capital Values ($/sq m) 4,125 4,725 3,000 3,750 savills.com.au/research 21

22 Top 15 Recent Adelaide Sales (by Sale Price) Property Price ($m) Date NLA (sq m) Yield Type $/sq m ATO Building, Franklin St, Adelaide Oct-16 36, e 7, Grenfell St, Adelaide Nov-16 25, e 4, Pirie St, Adelaide Apr-17 19, i 5,288 (50%) Westpac House Nov-16 31, e 5, King William St, Adelaide* Jul-17 12,643 n.a n.a 4, Playford Blvd, Elizabeth Nov-16 4, e 9,124 Citi Centre, Rundle Mall Aug-17 16,376 n.a n.a 2, Gawler Pl, Adelaide* Jul-17 11,127 n.a n.a 3,110 2 Second Ave, Mawson Lakes Apr-17 8, i 3, King William St, Adelaide Oct-16 15, e 1, North Terrace, Adelaide Dec-16 4, e 5, North Tce, Adelaide Dec-16 4, e 3, Fullarton Rd, Parkside Sep-17 2,381 n.a n.a 5, Park Tce, Salisbury Nov-16 1, e 5, Fullarton Rd, Dulwich 9.43 Feb-17 2, r 4,054 Yield Types: i = Initial, r = Reported, e = Equated, v = Vacant, dev = development; * part of a portfolio sale Top Adelaide Leases (by Area Leased) Property Tenant Date NLA (sq m) Type Rent Term 141 King William St (GPO Tower Dev Site), Adelaide Attorney-General's Department of SA Oct-16 12,000 Precom n.a Flinders St, Adelaide Department of Transport & Infrastructure Nov-16 7,100 Sublease n.a 6 26 Flinders St, Adelaide Employers Mutual Jun-17 3,500 Direct n.a 3 1 Richmond Rd, Keswick SA Power Networks Aug-17 2,337 Direct 405 (G) North Terrace, Adelaide Optus Nov-16 1,901 Direct 485 (G) Flinders St, Adelaide Nexia Edwards Marshall Feb-17 1,757 Renewal 420 (G) 5 1 Richmond Rd, Keswick DCNS Australia Oct-16 1,725 Direct 405 (G) Grenfell St, Adelaide First Mortgage Services (FMS) Jun-17 1,271 Direct 400 (G) North Terrace, Adelaide Southern Rail Aug-17 1,234 Direct 425 (G) King William St, Kent Town Food and Beverage Australia Limited (Fabal) Jan-17 1,044 Direct n.a 5 Leasing Types: p = Pre-commitment, d = Direct, s = Sub-Lease, r = Renewal savills.com.au/research 22

23 Australian Capital Territory PCA OMR Statistics (Jun-17) Canberra AUS CBD Total Stock 2,338,050 18,018,735 Total Vacancy 267,276 1,772,892 Vacancy (%) 11.4 (11.2) 10.5 (8.6) Net Absorption (12m) 7,089 (36,282) 188,097 (199,008) Net Absorption (%) 0.3 (1.9) 1.2 (1.3) Stock Additions 14, ,708 Stock Withdrawals 47, ,381 Net Additions -33,410 (60,686) 125,453 (325,578) Net Additions (%) -1.4 (3.1) 0.7 (2.0) Source: PCA / Savills Research Note: 10yr Average shown in brackets Canberra Civic Key Indicators Canberra Civic A Grade B Grade Low High Low High Rental Gross Face ($/sq m) Rental Net Face ($/sq m) Incentive Level Net 15% 20% 15% 25% Rental Net Effective ($/sq m) Outgoings Operating ($/sq m) Outgoings Statutory ($/sq m) Outgoings Total ($/sq m) Typical Lease Term Yield Market (% Net Face Rental) IRR (%) Cars Permanent Reserved ($/pcm) Office Capital Values ($/sq m) 5,265 8,350 3,500 5,400 savills.com.au/research 23

24 Canberra Non-Civic Key Indicators Canberra Non-Civic A Grade B Grade Low High Low High Rental Gross Face ($/sq m) Rental Net Face ($/sq m) Incentive Level Net 15% 20% 15% 25% Rental Net Effective ($/sq m) Outgoings Operating ($/sq m) Outgoings Statutory ($/sq m) Outgoings Total ($/sq m) Typical Lease Term Yield Market (% Net Face Rental) IRR (%) Cars Permanent Reserved ($/pcm) Office Capital Values ($/sq m) 4,775 7,725 3,100 5,000 Top 15 Recent Canberra Sales (by Sale Price) Property Price Date NLA Yield Type $/sq m 50 Marcus Clarke St, City Mar-17 40, e 7,985 Scarborough House Nov-16 16, i 4, Northbourne Ave, City Nov-16 10, e 5, Bowes St, Phillip Feb-17 12, e 4, Northbourne Av, Braddon Jun-17 6, e 8, Moore St, Canberra Jul-17 8, e 5, Bunda St, City 9.80 May-17 2, e 4,732 Yield Types: i = Initial, r = Reported, e = Equated, v = Vacant, dev = development; * Includes $10m in unpaid incentives Top 15 Recent Canberra Leases (by Area Leased) Property Tenant Rent ($/sq m) NLA (sq m) 2-6 Bowes Street, Phillip ACT Government Dec-16 10,931 Direct 355 (G) Northbourne Ave, City Department of Infrastructure and Regional Development Nov-16 10,218 Renewal 410 (G) 10 7 London Cct, City Commonwealth Super Jun-17 6,915 Direct 470 (G) 6 2 Constitution Ave, City ACT Government Dec-16 2,799 Direct 404 (G) 12 8 Brisbane Av, Barton Lockheed Martin Jun-17 2,257 Direct 385 (G) Barry Dr, Turner ANU Jun-17 1,805 Direct 380 (G) Marcus Clarke St, City Mills Oakley Lawyers Sep-17 1,050 Direct 385 (N) 10 2 Constitution Av, City National Aboriginal Community Controlled Health Organisation Sep-17 1,000 Direct 450 (G) 3 Leasing Types: p = Pre-commitment, d = Direct, s = Sub-Lease, r = Renewal savills.com.au/research 24

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26 Savills Australian Capital Territory Research Houssam Yakzan +61 (0) hyakzan@savills.com.au Savills New South Wales Research Shrabastee Mallik +61 (0) smallik@savills.com.au Metro & Regional Sales Robert Lowe +61 (0) rlowe@savills.com.au Valuations Phil Harding +61 (0) pharding@savills.com.au Research Houssam Yakzan +61 (0) hyakzan@savills.com.au Office Leasing Rob Dickins +61 (0) rdickins@savills.com.au Industrial Sales & Leasing Theo Dimarhos +61 (0) tdimarhos@savills.com.au Valuations Andrew Pannifex +61 (0) apannifex@savills.com.au Asset Management Phil Pearsall +61 (0) ppearsall@savills.com.au Project Management Mitchell Thomas +61 (0) mthomas@savills.com.au Capital Transactions Ian Hetherington +61 (0) ihetherington@savills.com.au Project Management Gavin Boswarva +61 (0) gboswarva@savills.com.au Savills Queensland Research Shrabastee Mallik +61 (0) smallik@savills.com.au Valuations Brett Schultz +61 (0) bschultz@savills.com.au Capital Transactions Anthony Ott +61 (0) aott@savills.com.au Office Leasing John McDonald +61 (0) jmcdonald@savills.com.au Sunshine Coast Scott Gardiner +61 (0) sgardiner@savills.com.au Gold Coast Kevin Carmody +61 (0) kevin@savillsgc.com.au Asset Management Chris Ainsworth +61 (0) cainsworth@savills.com.au Project Management Ken Ng +61 (0) kng@savills.com.au Savills South Australia Research Katy Dean +61 (0) kdean@savills.com.au Valuations Heath Dowling +61 (0) hdowling@savills.com.au Capital Transactions Peter Isaksson +61 (0) pisaksson@savills.com.au City & Metropolitan Sales Steve Bobridge +61 (0) sbobridge@savills.com.au Office Leasing Adam Hartley +61 (0) ahartley@savills.com.au Asset Management Jeffrey Klaebe +61 (0) jklaebe@savills.com.au Project Management Steve Christodoulou +61 (0) schristodoulou@savills.com.au Savills Victoria Research Monica Mondkar +61 (0) mmondkar@savills.com.au Valuations Trent Preece +61 (0) tpreece@savills.com.au CBD & Metropolitan Sales Clinton Baxter +61 (0) cbaxter@savills.com.au Office Leasing Mark Rasmussen +61 (0) mrasmussen@savills.com.au Asset Management Phillip Mcloughlin +61 (0) pmcloughlin@savills.com.au Project Management David Hayden +61 (0) dhayden@savills.com.au Savills Western Australia Research Katy Dean +61 (0) kdean@savills.com.au Office Leasing Shelley Ritter +61 (0) sritter@savills.com.au Valuations Mark Foster-Key +61 (0) mfosterkey@savills.com.au Asset Management Jason Ridge +61 (0) jridge@savills.com.au Capital Transactions Graham Postma +61 (0) gpostma@savills.com.au Project Management Graham Nash +61 (0) gnash@savills.com.au City & Metropolitan Sales Chas Moore +61 (0) cmoore@savills.com.au savills.com.au/research 26