Global Market Perspective

August 2017 Global Market Perspective JLL Global Research

Contents Global Market Perspective 3 Renewed momentum extends real estate cycle Global Economy 7 World recovery gaining momentum Global Real Estate Health Monitor 10 Sydney, Stockholm and Toronto lead office rental performance Real Estate Capital Markets 11 Investment volumes stable as capital continues to seek real estate exposure Capital Values and Yields 17 Office capital value growth bounces back as yield compression continues Corporate Occupiers 19 Human experience driving corporate real estate strategy Office Markets 21 Leasing volumes are steady; rental growth accelerates with new supply boosting asking rents Retail Markets 33 Structural change leading to polarisation in demand Industrial Markets 35 Tight supply and continued robust demand putting upward pressure on rents Hotels Markets 37 Transaction volumes lower, but sentiment remains positive; hospitality sector performance resilient Residential Markets 40 Rental growth decelerates in U.S. multifamily market; robust institutional investment in Europe Key Investment Transactions in Q2 2017 43 London maintains position as top investment destination for second quarter Illustrative Office Occupational Transactions in Q2 2017 48 Leasing activity strengthens in China s Tier 1 cities COPYRIGHT JONES LANG LASALLE IP, INC. 2017. All Rights Reserved 2

Renewed Momentum Extends Real Estate Cycle Market fundamentals remain robust Renewed momentum in the global economy has provided fresh vigour to several real estate markets. Office rental growth is accelerating once again on the back of robust leasing demand, and projections for the full-year have been revised upwards. Improvements are most evident in Western Europe which, together with China, has seen an impressive strengthening of leasing activity so far in 2017. Meanwhile, strong rental uplifts have been recorded in the warehousing sector in both the U.S. and Europe. The weight of capital seeking access to real estate continues to increase, with deal flows in line with the solid levels of 2016. Global Commercial Real Estate Market Prospects, 2017 Investment Firm Capital values 6% Increasing Leasing Stable 2017 prospects Rents 3% Increasing Vacancy rate Rising Development 28% Peaking Leasing, vacancy, development, rents and capital values relate to the office sector. Source: JLL, July 2017 Investment volumes stable as capital targeting real estate continues to grow Global transactional volumes have remained firm during the first half of 2017, coming in at US$297 billion, up 2% from the first half of last year. The second quarter saw a continuation of some of the political tension which has dominated the headlines for much of the year; however, global markets were largely unaffected as Q2 2017 volumes are 22% above the 10-year average for this period of the year. COPYRIGHT JONES LANG LASALLE IP, INC. 2017. All Rights Reserved 3

Projection millions sq m Global Market Perspective August 2017 Geopolitics will continue to play a major role in determining investor sentiment and market activity in 2017, while the prospects of tighter monetary policy will also impact on investment decisions. Despite these challenges global real estate investment continues to be accretive; even though yields are at their cyclical low, the weight of capital targeting the sector continues to increase. And while concerns about oversupply have begun to affect occupier fundamentals in certain global markets, global rental growth and capital value growth are expected to remain positive in 2017. Given this, we anticipate that 2017 transactional volumes will be more or less in line with the US$650 billion recorded in 2016. Global office leasing activity remains steady Office leasing activity has been remarkably stable during the first half of 2017, with global volumes virtually unchanged on the same period of 2016. Western Europe (+8%), where employment prospects and corporate sentiment have improved, has taken the lead in driving growth in leasing activity during 2017. Activity has also strengthened in China s Tier 1 Cities (+57% year-to-date), Southern Europe (+35%) and South East Asia (+17%), while there were signs of improvement in the UK market (+17%). For the full-year 2017, we expect global leasing volumes to remain stable, matching the levels recorded in 2016. Volumes are anticipated to be slightly higher than in 2016 in the United States, stable in Europe and slightly lower in Asia Pacific. Global Office Demand Gross Leasing Trends, 2007-2017 45 42 39 36 33 30 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 24 markets in Europe; 50 markets in the U.S; 22 markets in Asia Pacific Source: JLL, July 2017 COPYRIGHT JONES LANG LASALLE IP, INC. 2017. All Rights Reserved 4

Vacancy expected to rise, but Europe bucks the trend The global office vacancy rate is stable at 11.9%, where it has remained for much of the past year. Nonetheless, supply is expected to trend upwards during the rest of 2017, with both the Americas (14.7%) and Asia Pacific (11.1%) already seeing an uptick in supply in Q2. By contrast, Europe has witnessed a further fall in vacancy to 7.8%, and is likely to stay below 8% for the rest of 2017. Office rental growth surprises on the upside Rental growth has quickened in recent months, with annual growth for prime offices (across 26 major markets) accelerating in Q2 2017 to 3.4% (from 2.7% in Q4 2016). We have upgraded overall growth forecasts for 2017 to 3%, with Sydney, Stockholm and Brussels projected to top the global ranks for rental growth for the full year. Structural change becoming more prominent in global retail markets The continued growth of online sales, omni-channel retailing and technical innovations are leading to a bifurcation in retail markets, as major retailers invest in their distribution networks and rightsize larger store portfolios. At the same time, demand for quality retail that offers brand experience and convenience remains strong. Major markets in the U.S. are approaching their peak for the cycle with retail performance expected to slow this year as same-store growth stagnates for many retailers and store closures accelerate. Prime rents are still predominantly stable in Europe across all retail classes. In Asia Pacific, F&B operators continue to be the most active segment. Tight supply and continued robust demand boost rental growth in logistics markets Strong online retail sales growth coupled with automation, digital alignment of distribution processes and the need for new city logistics networks continues to propel robust occupier demand. Vacancy rates in the U.S. and Europe are expected to carry on edging downwards through the second half of 2017, which is boosting rents. In the U.S., rents have reached an all-time high following growth of 6.5% on an annualised basis, while in Europe the majority of markets are predicted to record rental increases over the year. Hotel transaction volumes muted, but sentiment remains positive The international hotel investment market was muted during the first half of 2017 with transactional activity totalling US$23 billion, 12% behind the same period last year. Despite ongoing geopolitical uncertainty investor sentiment remains positive, with improving economic prospects and bullish forecasts of hotel performance. Transactional activity is expected to pick up in the second half of the year. COPYRIGHT JONES LANG LASALLE IP, INC. 2017. All Rights Reserved 5

Growth decelerating in U.S. rental apartments on wave of supply Rental growth slowed further to 2.9% during Q2 2017 in the U.S. multifamily market, the first quarter to dip below 3% rental growth since year-end 2010. In spite of the overall declines in the pace of rental growth, a number of markets in the West region and Sunbelt continued to see gains in excess of 5% on the quarter. Institutional investment remains robust in continental Europe, with elevated transactional volumes in Germany and demand pushing yields to record lows in the Netherlands, while the UK institutional investment market continues to expand rapidly. In Asia Pacific, policy restrictions and limited supply have impacted sales volumes in Shanghai, while strong demand boosted the market upswing in Hong Kong and market sentiment has improved in Singapore. COPYRIGHT JONES LANG LASALLE IP, INC. 2017. All Rights Reserved 6

Global Economy World recovery gaining momentum in H1 After a healthy set of Q1 indicators, the April-June period has witnessed further consolidation in the global economic recovery, which has again been seen in a broadly-based upturn in sentiment, activity and trade. This has been noticeable not only in the developed world but also in emerging markets, where the recovery in commodity prices has also been important. As a result, there has been another modest upward shift in global expectations for the year ahead with tentative upside emerging for 2018. This improvement has occurred against a background of continued political headwinds in the developed world, though these risks appear to be receding. In Europe, elections in the Netherlands and France delivered decisive defeats for populist Eurosceptic parties and reinforced EU unity. The Eurozone has also experienced an upturn in its economic fortunes over recent quarters, which has been reflected in upgrades to forecasts for this year across the region, notably in France and Germany. The contrast with the UK is striking. A snap General Election in June was expected to consolidate Conservative party rule in the run-up to Brexit. The resulting unstable minority government looks weak, raising concerns about direction at a critical time as the UK prepares to leave the EU. Even before the vote, more equivocal demand had led to a downgrade in expectations for growth and the UK appears to be falling behind the pace of the Eurozone. There has also been a slight cooling in U.S. prospects, although forecasts have been broadly stable in Q2. This has been evident in financial markets, where the Trump rally has appeared to be running out of steam over recent weeks, and also in softer-than-expected data. Underlying growth remains solid, but it seems that much of the previous buoyancy in expectations reflected a belief that the new president would deliver a fiscal stimulus. Given stalled progress in other legislation any stimulus is now unlikely this year but may bring upside in 2018. GDP Projections for 2017 in Major Economies Recent Movements Australia China France Germany India Japan UK U.S. April 2017 2.8 6.5 1.4 1.8 7.2 1.4 1.9 2.1 July 2017 (Latest) 2.5 6.6 1.6 2.0 6.9 1.4 1.7 2.2 Change (bps) -30 +10 +20 +20-30 0-20 +10 Source: Oxford Economics, July 2017 COPYRIGHT JONES LANG LASALLE IP, INC. 2017. All Rights Reserved 7

Central banks ponder the QE retreat The Federal Reserve raised U.S short-term interest rates by a further 25 bps as expected in June. This was the second rise in 2017 and takes rates to a cycle-high of 1.00%-1.25%, though this is still very low by any historical standards. Market expectations are still for just one additional hike later in 2017, as the recent appearance of softer inflation readings and more uneven economic data are also being reflected by bond market investors in lower long-term Treasury yields. Nonetheless, the tightening cycle is expected to continue into the medium term. The Fed has turned its attention to normalising in the autumn that is, selling back the vast quantities of bonds accumulated during asset purchasing programmes following the GFC. The impact of this is still disputed, with some fearing the shock could halt the fragile global revival and others that it is essential to sustaining it. This debate has not just been confined to the U.S., as central bank rhetoric has become more hawkish elsewhere, notably from the Bank of England and ECB. But any upward movement in Eurozone, Japan and even UK policy rates still looks at least several quarters away. Modest uplift to the global outlook Improved data for H1 2017 have led to an upward revision in global growth forecasts. The change is not dramatic and the pace is set to remain below par by historic standards. However, after years of disappointed expectations and below-trend activity, this development is encouraging. In addition, the revival is synchronised with both developed and emerging markets projected to experience a cyclical upturn over the next 18 months. Asia Pacific will remain the most dynamic region in terms of output growth. Fears of a hard landing in China have waned thanks to government stimulus and a revival in trade. This year, output growth is forecast to stabilise at just below 7%, though the long-established trend of secular slowdown is on course to resume in 2018. India will continue to lead demand in Asia. Demonetisation and tax changes have had a short-term negative impact, but the Indian economy is expected to emerge stronger from 2018. Japan has seen upgrades in the near term, though the economy will struggle to escape the sub-1.5% growth rut of recent years. The European recovery presents an important global upside. In Europe s core, growth has been supported by solid domestic demand and jobs growth. German growth tops out at 2% in the current year, while lagging France sees further improvement into 2018. Outside the Eurozone, the UK is expected to slow as Brexit proceeds. Although the UK s slowdown is less severe than once feared, activity dips to a five-year low in 2018 and there is downside potential if Brexit negotiations become fractious. An acceleration in Americas growth is still elusive as the U.S. expansion continues to be slower than in previous cyclical upturns. Last year, the Trump administration raised expectations about pushing growth to a higher level. But with any fiscal stimulus delayed and interest rates rising, the forecast remains firmly sub-3% over the next two years at least, albeit with the rate of growth improving from 2016. COPYRIGHT JONES LANG LASALLE IP, INC. 2017. All Rights Reserved 8

Global Outlook, GDP Change, 2016-2018 2016 2017 2018 Global 3.1 3.5 3.7 Asia Pacific 5.5 5.4 5.3 Australia 2.5 2.5 2.4 China 6.7 6.6 6.1 India 7.9 6.9 7.4 Japan 1.0 1.4 1.3 Americas 0.8 1.9 2.5 U.S. 1.6 2.2 2.7 MENA 3.2 2.5 3.7 Europe 2.0 2.2 1.9 France 1.1 1.6 1.7 Germany 1.8 2.0 1.6 UK 1.8 1.7 1.5 Source: Oxford Economics, July 2017 COPYRIGHT JONES LANG LASALLE IP, INC. 2017. All Rights Reserved 9

Global Real Estate Health Monitor Economy Real Estate Investment Markets Real Estate Occupier Markets City Metro City Investment Capital Area Investment Volumes Value Prime Yield Rental Net Vacancy Supply GDP Volumes Change Change Yield Gap Change Absorption Rate Pipeline Beijing 7.1% 7.1 10% 0.5% 6.3% 267-0.7% 6.7% 6.3% 15.5% Boston 2.7% 12.6 3% -5.7% 4.1% 180 1.7% 0.8% 13.3% 2.1% Brussels 1.6% 2.2 11% 15.2% 4.5% 370 9.1% 2.2% 8.8% 2.2% Chicago 1.6% 8.4-28% -3.3% 5.2% 290 9.4% 0.6% 15.0% 1.7% Dubai 2.2% 1.0 23% 0.0% 7.5% na 0.0% na 14.0% 4.4% Frankfurt 2.1% 5.6 29% 20.2% 3.5% 303 1.4% -0.8% 8.6% 2.0% Hong Kong 2.8% 10.4-15% 21.9% 2.9% 138 8.3% -0.4% 4.4% 4.3% London 1.9% 28.6-13% -8.3% 3.5% 231-8.3% 0.5% 5.0% 4.7% Los Angeles 2.5% 21.8-1% -1.8% 4.3% 200 3.0% 0.5% 14.9% 1.3% Madrid 3.6% 5.6 121% 15.3% 3.8% 222 8.1% -2.7% 11.3% 1.3% Mexico City 2.9% 0.1-88% -3.7% 7.6% 82-1.1% 3.5% 14.0% 18.2% Milan 1.6% 2.6-21% 20.2% 3.8% 164 5.0% 0.5% 13.3% 2.0% Moscow 1.2% 3.6 36% -6.3% 10.5% 281-6.3% 2.1% 15.0% 5.7% Mumbai 7.1% 0.2-75% 2.3% 9.6% 246 1.2% 5.9% 16.8% 13.6% New York 1.4% 26.9-43% -4.9% 3.6% 130 3.8% 0.1% 10.6% 1.6% Paris 1.5% 16.5-32% 8.3% 3.0% 218 0.0% 1.0% 6.7% 2.7% San Francisco 4.0% 8.7 32% -7.1% 3.8% 150 0.9% 0.1% 8.6% 6.6% Sao Paulo -0.7% 0.6 131% -5.9% 10.3% 572-1.0% 1.6% 25.3% 7.1% Seoul 2.0% 14.1 59% -5.6% 4.4% 222-7.5% 4.3% 11.2% 4.1% Shanghai 6.6% 17.9 54% 0.0% 5.7% 210-0.7% 11.9% 18.4% 36.4% Singapore 2.7% 9.3 12% -0.9% 3.6% 149-3.9% 2.0% 6.8% 10.1% Stockholm 2.8% 3.6-30% 25.6% 3.5% 285 17.2% 1.3% 7.6% 1.5% Sydney 2.8% 7.3-4% 22.8% 4.9% 234 32.4% 0.7% 7.0% 1.9% Tokyo 1.1% 14.5 17% 3.1% 2.9% 282 1.4% 2.3% 2.9% 10.4% Toronto 3.4% 7.2-5% 17.4% 4.3% 254 9.8% 1.6% 9.7% 1.4% Washington DC 1.9% 12.7 6% -2.7% 4.5% 220 4.2% 0.0% 16.8% 2.8% Real estate data as at end Q2 2017. See page 50 for definitions and sources. COPYRIGHT JONES LANG LASALLE IP, INC. 2017. All Rights Reserved 10

Real Estate Capital Markets Investment Volumes Despite an elongated cycle, real estate remains attractive to global capital Global transactional volumes remained stable in the second quarter of 2017, coming in at US$153 billion, unchanged from the levels recorded in Q2 2016. This brings H1 2017 volumes to US$297 billion, up 2% from the first half of last year. The second quarter saw a continuation of some of the political tension which has dominated the headlines for much of the year, particularly in France, the U.S. and the UK. However, the positive election results in France reassured investors that the European Union was not in danger of further turmoil. Global markets were largely unaffected, as Q2 2017 volumes are 22% above the 10-year average for this period of the year. U.S. market continues to cool The only region to post year-on-year declines, the Americas saw Q2 investment activity slide by 7% to US$64 billion compared to a year ago, bringing first half volumes down by 6% to US$122 billion. Driving the downward movement was the U.S., where second quarter volumes fell by 7% to US$59 billion, resulting in H1 volumes decreasing by 10% to US$110 billion. Q2 volumes in Canada rose by 5% compared to a year ago and while the Latin American markets are mixed compared to Q2 2016, all markets in the Americas outside the U.S. are up over the first half of 2017. Germany and the Netherlands push Europe ahead A strong second quarter saw European investment volumes edge up 4% compared to this time last year to US$58 billion. Combined with a similarly positive start to the first quarter, activity in H1 2017 is up 7% from H1 2016 at US$114 billion. Volumes in Germany jumped by 25% to their second highest recorded level in the first half of the year, while a robust Q2 helped volumes in the Netherlands climb by 53% to reach their third highest first half. H1 gains in Spain (+51%), Russia (+31%) and Finland (+20%) were balanced by dips in France (-16%) and Sweden (-7%). In the UK, markets continued to shrug off political uncertainty as H1 2017 investment activity rose by 18% to its third highest level on record in local currency terms. China leads the charge in Asia Pacific After a muted start to the year, Q2 investment volumes in Asia Pacific rose by 10% year-on-year to US$31 billion, bringing first half volumes 13% higher than last year to US$61 billion. Robust investment in China boosted quarterly volumes by 33% to US$8 billion, leading to a first half increase of 36%. In Japan, a strong Q1 helped lift H1 volumes by 15%, with Q2 volumes increasing by 10%. By contrast, Singapore recorded a 3% drop in H1 2017 volumes, with activity not able to keep up with the vigorous first half of 2016. Australia is up on last quarter (+94%) but down on the first half of last year (-5%). COPYRIGHT JONES LANG LASALLE IP, INC. 2017. All Rights Reserved 11

US$ billions Global Market Perspective August 2017 Investment growth expected to be flat in 2017 Geopolitics will continue to play a major role in determining investor sentiment and market activity in 2017. While the recent French elections passed without too much turmoil, the continuation of the Brexit process coupled with a newfound tension in relations between the U.S. and many of its allies across the world has given investors cause for concern. Alongside the geopolitics, central bankers in many developed economies continue to give strong signals that policy normalisation is around the corner. Discussions of a possible slowdown in quantitative easing by the ECB rattled markets, while the Federal Reserve has discussed unwinding its stimulus programme in ever clearer terms. With tapering likely to start at the end of 2017 or early 2018, the prospects of tighter monetary policy will play an increasingly important role in determining investment decisions. Despite these challenges, global real estate investment continues to be accretive; even though yields are at their cyclical low, the weight of capital seeking access to the sector continues to grow. And while concerns about oversupply have begun to affect occupier fundamentals in certain global markets, global rental growth and capital value growth are expected to remain positive in 2017. Given this, we anticipate that 2017 transactional volumes will be more or less in line with the US$650 billion recorded in 2016. Direct Commercial Real Estate Investment, 2006-2017 800 700 600 500 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 (F) ~0% 400 300-0-5% ~0% 200 ~0% 100 0 Americas EMEA Asia Pacific Global Source: JLL, July 2017 COPYRIGHT JONES LANG LASALLE IP, INC. 2017. All Rights Reserved 12

Direct Commercial Real Estate Investment Regional Volumes, 2016-2017 US$ billions Q1 2017 Q2 2017 % change Q1 17-Q2 17 Q2 2016 % change Q2 16-Q2 17 H1 2016 H1 2017 % change H1 16-H1 17 Americas 58 64 10% 69-7% 130 122-6% EMEA 56 58 3% 56 4% 106 114 7% Asia Pacific 29 31 6% 28 10% 54 61 13% Total 144 153 7% 153 0% 290 297 2% Source: JLL, July 2017 Direct Commercial Real Estate Investment Largest Markets, 2016-2017 US$ billions Q1 2017 Q2 2017 % change Q1 17-Q2 17 Q2 2016 % change Q2 16-Q2 17 H1 2016 H1 2017 % change H1 16-H1 17 U.S. 51.2 58.8 15% 63.5-7% 122.0 110.0-10% UK 15.4 17.7 15% 15.0 18% 31.9 33.1 4% Germany 12.3 11.3-8% 10.5 8% 18.9 23.6 25% Japan 11.3 8.2-28% 7.4 10% 17.0 19.5 15% China 4.4 8.0 82% 6.0 33% 9.1 12.4 36% Australia 2.5 4.9 94% 4.4 10% 7.8 7.4-5% Netherlands 2.1 4.6 118% 2.8 62% 4.4 6.7 53% Canada 5.3 4.2-21% 4.0 5% 6.6 9.6 44% France 5.1 3.9-24% 7.1-45% 10.7 9.0-16% South Korea 4.9 3.4-30% 3.1 10% 5.8 8.3 43% Italy 1.9 3.4 74% 2.4 41% 4.7 5.3 13% Spain 2.9 3.0 4% 1.7 75% 3.9 5.9 51% Singapore 2.0 3.0 52% 4.4-33% 5.1 4.9-3% Hong Kong 2.7 2.4-11% 1.6 54% 5.1 5.2 1% Sweden 2.7 2.3-13% 2.5-9% 5.4 5.0-7% Norway 1.8 2.0 7% 1.6 20% 3.4 3.8 12% Source: JLL, July 2017 COPYRIGHT JONES LANG LASALLE IP, INC. 2017. All Rights Reserved 13

Regions in focus Americas investment activity slows but steady finish for 2017 expected Regional investment in Americas real estate reached US$122 billion in H1 2017, down 6% from the same period in 2016. Within the U.S., transaction volumes also declined, falling 10% year-on-year to US$110 billion in the first half of 2017. Contributing factors behind activity slipping from the cyclical high of 2015 include greater discipline in asset selection by domestic U.S. investors, together with a relative shortage of available product for sale in some primary markets. Elsewhere in the Americas, Canada experienced healthy investment levels in the second quarter, with transactional activity 5% above Q2 2016 at US$4.2 billion. With the economic outlook brightening and a transition to stronger property market fundamentals underway, the Canadian investment market may be especially well-positioned in the broader North American context. In Latin America, investment volumes remained relatively subdued in the second quarter; however, the two largest markets have year-to-date volume totals that are at least double those in H1 2016. In Brazil, the office sector dominated trading in the second quarter, while hotel investment was the driver behind transactional activity in Mexico during the period. Both countries appear poised for increased investment levels in the second half of 2017. A continued healthy investment market is expected for the rest of 2017 in the region. The dominant U.S. market is projected to remain down moderately in transaction levels due to greater selectivity by domestic institutions and relatively tight product supply in some markets. However, global investors are anticipated to carry on prioritising the U.S. market for capital deployment in the property asset class, which is still well positioned for strong returns in relation to other asset classes. Somewhat more robust investment activity growth may be found outside the U.S., as Canada and Latin America s economic prospects have improved or stabilised, and transaction volumes for the Americas are forecast to finish the year only slightly lower than in 2016, with a decrease of up to 5%. EMEA investment volumes on the rise in Q2 2017 EMEA investment volumes reached US$58 billion in a very active Q2 2017, edging up 4% compared to the same quarter last year. Weaker second quarter investment activity in France (-45% year-onyear) was compensated for by a solid performance from Europe s growth engine Germany, which reported an 8% annual increase. The UK market performed quite well, registering volumes of nearly US$18 billion in Q2, a rise of 18% year-on-year in dollar terms, and 33% in local currency. Southern Europe outperforms, while Russia capitalises on higher yields Southern Europe saw investment levels jump 58% year-on-year, supported by significant increases in Spain (+75%) and Italy (+41%). Greece, which has witnessed more investment flowing in, posted investment volumes of nearly US$400 million in the quarter (compared to only US$38 million in Q2 2016), spread over a growing number of deals and sectors. COPYRIGHT JONES LANG LASALLE IP, INC. 2017. All Rights Reserved 14

Overall investment activity across Central and Eastern Europe (CEE) was down by 5% year-on-year (to US$3.4 billion). This was mainly due to the weaker performance of the Polish market (-28%). Russia, on the other hand, saw a healthy nearly US$1 billion increase in volumes compared to Q2 2016, in what amounted to a 285% spike in investment activity. Elsewhere in Europe, the Nordics saw transactional activity increase 6% year-on-year in Q2 2017, with growth in Finland (+111%) and Norway (+20%) balancing declines in Sweden (-7%) and Denmark (-28%). London maintains position at top of global rankings Investment volumes in London rebounded by 32% year-on-year in Q2 2017, helping push first half volumes 33% higher as it maintained its position as the top global investment destination for a second quarter. New York remained in second place, despite transactional activity declining by 54% in H1. North American markets accounted for the majority of leading cities with several recording robust growth, including Vancouver, Boston, San Francisco, Atlanta and Dallas. In Asia Pacific, Shanghai posted its strongest first half on record as volumes increased by 86% over the same period last year. Direct Commercial Real Estate Investment, Top 20 Cities, H1 2017 London New York Los Angeles Boston Tokyo Shanghai Washington DC Seoul Hong Kong Singapore Paris Silicon Valley Sydney Dallas Yokohama Seattle Toronto Atlanta San Francisco Vancouver Americas EMEA Asia Pacific US$ billions 0 2 4 6 8 10 12 14 16 18 Source: JLL, July 2017 Transactional activity stronger in the Asia Pacific region Investment volumes across Asia Pacific s commercial real estate markets came in at US$60.7 billion during H1 2017, up 13% from the same period a year ago, and are looking on track to reach our full-year forecast of US$130 billion. China led performance during the first half of the year, but transactional activity was also higher in South Korea and Japan and largely stable in Australia, Hong Kong and Singapore. Cross-border investment volumes remained firm during H1 2017, accounting for 30% of total transaction volumes. Inter-regional purchasers were active, particularly in India, China and Australia, representing nearly one-half of all cross-border purchaser activity. COPYRIGHT JONES LANG LASALLE IP, INC. 2017. All Rights Reserved 15

Domestic buyers dominate in Japan Japan recorded US$19.5 billion worth of transaction volumes in the first half of 2017, up 15% year-on-year. Domestic buyers dominated the market with J-REITs comprising close to 30% of total activity, but some offshore investors became more active in non-core locations. Transaction volumes for the full-year 2017 (in yen terms) are likely to be similar to last year s level. Although there are still limited opportunities, particularly for new entrants, more owners seem willing to sell instead of refinancing their assets. Cross-border capital maintains interest in Australia Investment volumes in Australia came to US$7.4 billion in H1 2017, down slightly by 5% year-onyear. A significant proportion of demand was from offshore capital sources, with cross-border buyer activity making up one-third of total transactional activity and outpacing cross-border sellers by almost two to one. We expect transaction levels to remain elevated over the remainder of 2017. Strong start to 2017 for foreign buyers in China China registered US$12.4 billion worth of transaction volumes in the first half of 2017, up 36% year-on-year. Foreign buyers have had a strong start to 2017, accounting for one-third of total transactional activity in Q2. Looking ahead, the investment market is likely to remain stable as domestic money will aim to invest locally following the introduction of capital outflow restrictions. Domestic developers, in particular, are expected to become a new pool of buyers for existing assets as they seek to deploy excess capital. Direct Commercial Real Estate Investment Quarterly Trends, 2007-2017 Source: JLL, July 2017 COPYRIGHT JONES LANG LASALLE IP, INC. 2017. All Rights Reserved 16

Asia Pacific Americas Europe Global Market Perspective August 2017 Capital Values and Yields Bounce back in capital value appreciation Capital value growth for prime assets in 26 major office markets bounced back to 4.5% in the year to Q2 2017, reversing a deceleration since early 2016. The improvement was largely due to income growth. Capital value growth is expected to increase further to around 6% for the full year. Several office markets have registered exceptional capital appreciation over the past year, notably Stockholm (+26%), Sydney (+23%), Hong Kong (+22%), Milan (+20%) and Frankfurt (+20%). By contrast, prime notional capital values are correcting in some U.S. markets (as prime yields shifted slightly in late 2016 into early 2017), as evident in San Francisco (-7%), Boston (-6%) and New York (-5%). Further yield compression Further prime office yield compression has been recorded in Brussels (25 bps), Stockholm (25 bps), Hong Kong (25 bps), Sydney (20 bps) and Milan (15 bps). Yields are largely flat in the U.S. gateways. Only Mexico City and Boston have seen yields move outwards over the past quarter. Prime Office Yield Shift, Q2 2016 Q2 2017 Brussels Q1 2017 - Q2 2017 Frankfurt London Q2 2016 - Q1 2017 Madrid Milan Moscow Paris Stockholm Boston Chicago Los Angeles New York San Francisco Toronto Washington DC Sao Paulo Mexico City Beijing Hong Kong Mumbai Seoul Shanghai Singapore Sydney Tokyo Basis point change -90-70 -50-30 -10 10 30 50 70 Source: JLL, July 2017 COPYRIGHT JONES LANG LASALLE IP, INC. 2017. All Rights Reserved 17

Prime Office Yields, 2007-2017 % 7.1 6.87% Mean Prime Office Yields* 6.6 6.1 5.6 5.49% 5.1 4.6 bps 70 Q1 '07 Q2 '07 Q3 '07 Q4 '07 Q1 '08 Q2 '08 Q3 '08 Q4 '08 Q1 '09 Q2 '09 Q3 '09 Q4 '09 Q1 '10 Q2 '10 Q3 '10 Q4 '10 Q1 '11 Q2 '11 Q3 '11 Q4 '11 Q1 '12 Q2 '12 Q3 '12 Q4 '12 Q1 '13 Q2 '13 Q3 '13 Q4 '13 Q1 '14 Q2 '14 Q3 '14 Q4 '14 Q1 '15 Q2 '15 Q3 '15 Q4 '15 Q1 '16 Q2 '16 Q3 '16 Q4 '16 Q1 '17 Q2 '17 50 30 10-10 -30 Yield Compression (bps) *Across 21 major office markets Source: JLL, July 2017 COPYRIGHT JONES LANG LASALLE IP, INC. 2017. All Rights Reserved 18

Corporate Occupiers Occupier activity remains robust Corporate occupier activity has remained robust across key global markets. In Asia Pacific overall leasing activity is relatively stable as Delhi continued to be the regional leader in total volume leased, while Melbourne, Singapore and China s Tier 1 cities have also seen strong growth in leasing over the first half of 2017. In the U.S., continued economic and business expansion is evident despite political headwinds, and an unprecedented focus on talent attraction and retention are key themes shaping occupier activity. Leasing activity and net absorption during Q2 increased from the previous quarter, although were below the levels seen in 2015 and 2016. An improving economic environment and corporate sentiment in Europe pushed office take-up to 3.0 million square metres in Q2 2017, the highest second quarter since 2006. Human experience driving corporate real estate strategy An increased focus on talent and productivity within corporate strategy has contributed to a growing emphasis on employee experience. In response to this shift, JLL has carried out a unique global research project to decode the workplace experience, understand its specific impact on business performance and work out how real estate can help achieve strategic performance objectives. The results of our research project have pinpointed three priorities to drive human experience for corporate occupiers. Key recommendations include: Engagement Introducing innovative workspaces will drive engagement Use workspace to foster an entrepreneurial spirit to attract and retain employees Consider adjusting workplace density to improve employee effectiveness Formalize human experience in the organizational structure Empowerment Trust, kindness and taking initiatives the top three work philosophies will empower employees Agility the choice to work elsewhere will improve performance and quality of life Employees appreciate space for concentration, regeneration and movement Fulfilment Happiness is the number one priority for a positive workplace experience Companies must consider spaces dedicated to health and well-being Managerial approaches linked to recognition and personal learning and development also impact employee fulfilment COPYRIGHT JONES LANG LASALLE IP, INC. 2017. All Rights Reserved 19

Global Office Market Conditions Matrix*, 2017-2019 2017 2018 2019 2017 2018 2019 2017 2018 2019 Chicago Brussels Beijing Los Angeles Frankfurt Hong Kong New York San Francisco London (West End) Madrid Mumbai Shanghai Toronto Washington DC Moscow Paris Singapore (CBD Overall) Sydney Mexico City Sao Paulo Stockholm Dubai Tokyo (CBD 5-kus) Tenant Favourable Neutral Market Landlord Favourable *Relates to conditions in the overall office market of a city. Conditions for prime CBD space may differ from the above. Source: JLL, July 2017 COPYRIGHT JONES LANG LASALLE IP, INC. 2017. All Rights Reserved 20

Office Markets Office Demand Dynamics Global office leasing activity is steady Office leasing activity has been remarkably stable during the first half of 2017, with global volumes virtually unchanged on the same period of 2016. Western Europe (+8% year-on-date), where employment prospects and corporate sentiment have improved, has taken the lead in driving growth in leasing activity during 2017. At a sub-regional / country level: Activity has strengthened in China s Tier 1 Cities (+57% year-to-date), Southern Europe (+35%) and South East Asia (+17%). There were also signs of improvement in the UK market (+16%). Volumes remain firm in Core Europe (+3%) and Australia (0%), but have moderated slightly in the United States (-3%) and India (-3%). Of the major economies, only Japan has seen notably lower volumes in 2017 (-58%), in part due to supply shortages in existing buildings in Tokyo. For the full-year 2017 we expect global leasing volumes to remain steady, matching the levels recorded in 2016. Volumes are projected to be somewhat higher than in 2016 in the United States, stable in Europe and slightly lower in Asia Pacific. Western Europe take-up highest Q2 since 2006 After a strong first quarter, robust occupier demand pushed European office take-up to 3.0 million square metres in Q2 2017. Total take-up across Europe in H1 2017 is now 4% higher than a year ago, and is 8% higher in Western Europe. By contrast, take-up in Central and Eastern Europe has fallen by 14%: Germany has seen volumes increase a further 5% (year-to-date) on the record levels of 2016. Berlin is the most active leasing market, while Hamburg has registered the strongest growth in take-up so far in 2017. Take-up in Germany is expected to remain healthy for the remainder of the year, although a repeat of the record 2016 outcome is unlikely. The vigorous momentum recorded in Paris in Q1 slowed somewhat in Q2 2017, but uncertainty ahead of the French presidential elections may explain some of this deceleration. Nonetheless, volumes in H1 are still 4% higher than a year ago and we predict the continued strengthening of employment growth and corporate sentiment to push take-up to around 2.3 million square metres for the full-year 2017. Volumes in London in H1 are 11% higher than a year ago. The serviced office sector has accounted for around 35% of London s take-up in response to increasing requirements for flexible space. COPYRIGHT JONES LANG LASALLE IP, INC. 2017. All Rights Reserved 21

The Dutch cities have posted strong leasing market activity, with volumes up 41% in H1. While Amsterdam has taken the lead, activity is now expanding in other Dutch cities such as The Hague and Rotterdam. Other European cities registering vigorous growth in leasing volumes in 2017 to date include Edinburgh (+70%), Dublin (+64%), Barcelona (+47%), Madrid (+35%) and Milan (+26%). Leasing activity bounces back in the United States After a slow start to the year, the U.S. office market rebounded during the second quarter on the back of sustained tenant demand, consistent economic fundamentals and a raft of new supply coming to the market. Office leasing activity saw a modest bump of 4% over the quarter, with a diverse set of geographic and industry contributors. Although tech remained the largest industry by volume, its share of transactions (17.4%) fell below previous quarters as hiring constraints, uncertainty over immigration and visa policies, and a broader cooling throughout the sector limited its dominance during Q2. A bevy of large leases from financial firms points to strength in an industry that is heavily exposed to rightsizing and automation. Despite a return to healthier levels during the second quarter, net absorption has become increasingly unstable at the market level: 55% of occupancy growth so far this year has come from two markets Seattle and Dallas powered by organic tech and corporate expansion that continues apace. Secondary markets such as Austin, Raleigh-Durham, Oakland-East Bay, Denver and Charlotte have also made further strides this year. Notably, absorption continues in these metro areas, despite significant tightening and rental growth, as their talent pools and relative cost advantages compared to gateway markets make them attractive for occupiers in knowledge-intensive and creative industries. By contrast, year-to-date absorption has been negative in certain key markets, including Silicon Valley and San Francisco which previously led much of the recovery and were consistently among the top contributors to national net absorption. Supply and demand dynamics balanced across most Asia Pacific markets Although leasing activity declined by 13% year-on-year in Asia Pacific in Q2, volumes were down only 2% in the first half of the year, indicating stable leasing levels across the region. Delhi has continued to be the regional leader for leasing volumes, while Bengaluru, Manila and Guangzhou have also seen strong new leasing so far in 2017. However, sluggish tenant demand has impacted leasing activity in Seoul and Taipei. Aggregate gross leasing for the four India Tier 1 cities registered a small 3% decline in H1 2017. Traditional sectors remained the primary demand drivers; however, co-working operators have started to be major contributors of space take-up. Uncertainty surrounding U.S. offshoring policy and automation has seen ITES firms exercise caution. COPYRIGHT JONES LANG LASALLE IP, INC. 2017. All Rights Reserved 22

Projection Global Market Perspective August 2017 Leasing activity was higher in all three China Tier 1 cities. Domestic financials, insurance, real estate and tech firms drove leasing activity across these markets. At the same time, Hong Kong has witnessed strong demand from financial firms from the PRC. A lack of available space in existing buildings and upcoming supply in Japan s core areas continued to impact leasing activity in the Grade A segment in the first half of the year. Gross leasing volumes in H1 2017 in Singapore were notably higher than a year earlier, bolstered by large deals on recently completed or upcoming buildings as tenants take advantage of lower rents to lease high-quality space. Aggregate gross leasing volumes in Australia during H1 2017 were flat on a year ago. Demand is strong and broadly-based in Melbourne (up 78% in H1), with centralisation a key theme. In Sydney, however, gross leasing was 33% lower than a year earlier due to a high base effect as leasing levels in H1 2016 were bolstered by pre-leasing in new developments. Asia Pacific leasing volumes this year are likely to be marginally lower (0% to -5%) than in 2016, with upside potential for improved activity by year-end. Global Office Demand Gross Leasing Volumes Change, H1 2016 H1 2017 China UK Germany France Australia United States India Japan Americas EMEA Asia Pacific % change -60-50 -40-30 -20-10 0 10 20 30 40 50 60 Based on 6 cities in Australia; 3 cities in China; 2 cities in France; 5 cities in Germany; 4 cities in India; 1 city (Tokyo) in Japan; 50 cities in the United States; 2 cities in the UK Source: JLL, July 2017 COPYRIGHT JONES LANG LASALLE IP, INC. 2017. All Rights Reserved 23

millions sq m Projection millions sq m Global Market Perspective August 2017 Global Office Demand Annual Gross Leasing Volumes, 2007-2017 45 42 39 36 33 30 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 24 markets in Europe; 50 markets in the U.S.; 22 markets in Asia Pacific Source: JLL, July 2017 Global Office Demand Quarterly Gross Leasing Volumes, 2012-2017 11 10 9 8 7 Q112 Q212 Q312 Q412 Q113 Q213 Q313 Q413 Q114 Q214 Q314 Q414 Q115 Q215 Q315 Q415 Q116 Q216 Q316 Q416 Q117 Q217 24 markets in Europe; 50 markets in the U.S.; 22 markets in Asia Pacific Source: JLL, July 2017 COPYRIGHT JONES LANG LASALLE IP, INC. 2017. All Rights Reserved 24

Office Supply Trends Global office vacancy rate stable at 11.9%, but trending upwards The global office vacancy rate is stable at 11.9%, where it has remained for much of the past year. Nonetheless, supply is expected to trend upwards during the rest of 2017, with both the Americas (14.7%) and Asia Pacific (11.1%) already seeing an uptick in supply in Q2. By contrast, Europe has seen a further fall in vacancy to 7.8%, and is likely to stay below 8% for the remainder of 2017. European vacancy edges down to 7.8% European office vacancy, at 7.8%, is at its lowest since Q4 2008. Robust leasing activity is offsetting higher development completions and vacancy has fallen in the majority of markets: Some of the largest falls over the past year have been recorded in the Dutch cities. Amsterdam has seen vacancy fall by one-third over the past year and, at 8.3%, vacancy is at its lowest since 2002. The German cities of Berlin, Munich and Hamburg continue to register reductions in supply. In fact, Berlin and Munich, at 4.1% and 4.0% respectively, command Europe s lowest vacancy rates. With development activity set to increase across the Big 5 German cities, vacancy rates are likely to stabilise towards the end of 2017. In London and Dublin, vacancy is trending upwards as new space comes on stream. In London the vacancy rate now sits at 5%, the highest rate since 2014 but still below the long-run average. Total 2017 completions in Europe are expected to reach 5.1 million square metres, which is around 25% ahead of the five-year average. At 5.2 million square metres, the 2018 development pipeline will be just as significant, with the majority of completions concentrated in Paris, London, Moscow, Luxembourg and Munich. European office vacancy is projected to remain stable at 7.8% in 2017, as higher completions are balanced by solid leasing activity. Expansionary demand will keep vacancy rates on a downward trajectory across most of Western Europe. Supply volumes mixed; Asia Pacific vacancy rate rises slightly to 11.1% Vacancy rates continued to decline in about half of Asia Pacific markets during Q2 2017; at the same time a fifth of them saw even higher vacancy, with those in Beijing having increased the most over the quarter. The Asia Pacific regional vacancy rate is forecast to push up to around 12% by the end of 2017, with Jakarta, Singapore and Ho Chi Minh City all expected to register a notable increase in vacancy. COPYRIGHT JONES LANG LASALLE IP, INC. 2017. All Rights Reserved 25

U.S. construction altering the market landscape The surge of ground-breakings that began in 2014 and 2015 is now beginning to provide some relief in a number of U.S. markets, which will help to spur leasing activity that has been hindered by a lack of options and cost concerns. Due to rising new deliveries and more muted net absorption the national vacancy increased for the third consecutive quarter in Q2 2017, registering a 10 bps rise to 14.8%. The rise in vacancy has been particularly noticeable in tech hubs: Sunnyvale in Silicon Valley, for instance, has seen vacancy rise from 8.9% to 14%. With nearly 8 million square metres of deliveries expected over the next six quarters, of which about half is currently available, dynamics will change markedly in terms of landlord/tenant leverage, paving the way for a more balanced and competitive marketplace. Canada s office market steady with stronger demand ahead The Canadian office market loosened marginally in the second quarter, with total vacancy increasing 10 bps to 12.2%. The national market continues to be sharply divided in performance between the robust leasing markets in Vancouver and Toronto, and the challenged energy-focused markets of Edmonton and Calgary. Montreal is beginning to show increasingly positive signs with its single strongest quarter of net absorption in well over a decade. Mexico City stable as construction wave to crest in second half of 2017 Mexico City has seen its vacancy rate remain steady at 14% in Q2 2017 as demand continues to be resilient in the face of heavy supply additions. Rental rates have kept largely stable, declining only very modestly over the course of Q2. With deliveries continuing to ramp up, the vacancy rate is poised to increase into 2018, with downward pressure on rental rates anticipated. New supply winding down and demand outlook brighter in Brazil As the development pipeline empties and economic growth returns, it s likely that in 12-18 months the leasing market in Sao Paulo will be in substantially greater balance than it is today. Rental rates are already close to the cyclical trough in the market, and broad stabilisation is approaching. Dubai vacancy trends downwards With limited levels of new supply entering the Dubai market, vacancies have generally trended down to 14% in the CBD, 2% lower than the same period last year and the lowest level since before the Global Financial Crisis. COPYRIGHT JONES LANG LASALLE IP, INC. 2017. All Rights Reserved 26

millions sq m Global Market Perspective August 2017 Global Office Completions, 2000-2019 20 U.S. Europe Asia Pacific 15 Average 10 5 0 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 (F) 2018 2019 (F) (F) 24 markets in Europe; 25 markets in Asia Pacific; 50 markets in the U.S. Asia relates to Grade A only. Source: JLL, July 2017 Office Supply Pipeline Major Markets, 2017-2018 Shanghai Mexico City Beijing Mumbai Tokyo Singapore Sao Paulo San Francisco Moscow London Dubai Hong Kong Seoul Washington DC Paris Brussels Boston Frankfurt Milan Sydney Chicago New York Stockholm Toronto Madrid Los Angeles 2017 2018 Completions as % of existing stock 0 5 10 15 20 25 30 35 40 Covers all office submarkets in each city. Tokyo CBD - 5 kus Source: JLL, July 2017 COPYRIGHT JONES LANG LASALLE IP, INC. 2017. All Rights Reserved 27

Q4 2009 Q1 2010 Q2 2010 Q3 2010 Q4 2010 Q1 2011 Q2 2011 Q3 2011 Q4 2011 Q1 2012 Q2 2012 Q3 2012 Q4 2012 Q1 2013 Q2 2013 Q3 2013 Q4 2013 Q1 2014 Q2 2014 Q3 2014 Q4 2014 Q1 2015 Q2 2015 Q3 2015 Q4 2015 Q1 2016 Q2 2016 Q3 2016 Q4 2016 Q1 2017 Q2 2017 Vacancy Rate (%) San Francisco Toronto New York Boston Mexico City Los Angeles Chicago Washington DC Sao Paulo London Paris Stockholm Frankfurt Brussels Madrid Milan Moscow Tokyo Hong Kong Beijing Singapore Sydney Seoul Mumbai Shanghai Global Market Perspective August 2017 Office Vacancy Rates in Major Markets, Q2 2017 Global 11.9% 30% 25% Americas 14.7% Europe 7.8% Asia Pacific 11.1% Quarterly movement Increased Decreased Stable 20% 15% 10% 5% 0% Regional vacancy rates based on 62 markets in the Americas, 24 markets in Europe and 25 markets in Asia Pacific. Covers all office submarkets in each city. All grades except Asia and Latin America (Grade A only). Tokyo relates to CBD 5 kus. Source: JLL, July 2017 Global and Regional Office Vacancy Rates, 2009-2017 19 17.9% 17 15 14.4% 14.7% Americas 13 11 11.9% 10.3% 11.9% GLOBAL 11.1% Asia Pacific 9 7 7.8% Europe 62 markets in the Americas, 24 markets in Europe, 25 markets in Asia Pacific. All grades except Asia and Latin America (Grade A only). Source: JLL, July 2017 COPYRIGHT JONES LANG LASALLE IP, INC. 2017. All Rights Reserved 28

Office Rental Trends Rental growth surprises on the upside Rental growth has quickened in recent months, with annual growth for prime offices (across 26 major markets) accelerating in Q2 2017 to 3.4% (from 2.7% in Q4 2016). Several major markets are witnessing particularly vigorous growth, with double-digit uplifts in Sydney (+32% year-on-year), Stockholm (+17%) and Toronto (+10%). Meanwhile, Chicago (+9%) and Washington DC (+4%) continue to register solid growth in asking rents; Hong Kong Central has again seen a further uplift (+8%); and rents are gathering pace in Brussels (+9%), Madrid (+8%) and Milan (+5%). Significantly, Singapore and Sao Paulo have recorded their first quarter-on-quarter rental growth since Q1 2015 and Q1 2012 respectively, pointing to a turning point in their rental cycles. We have upgraded overall rental growth expectations for 2017 from 2% to 3%. Sydney, Stockholm and Brussels are anticipated to top the global ranks for rental growth for the full year. New supply driving up asking rents in the United States New high-quality offices in the U.S., that are commanding a premium compared to existing space, have placed significant upward pressure on rents, which have risen by 3.2% over the year and by 4.9% for CBD Class A space. Moving into the second half of 2017 and into 2018, the wave of new supply to deliver over the next six quarters will markedly alter the office landscape, increasing competition among landlords for tenants and stabilising rents in the process. Rental growth maintains its momentum across mainland Europe The European Office Rental Index rose by 2.1% in the year to Q2 2017, nearly double the 10-year average of 1.2%. Excluding the UK, annual rental growth reached 3.6%, highlighting the continued momentum across mainland Europe. Rental uplifts have been recorded across a broad range of European markets. Stockholm is catching the headlines as the standout market, but solid growth is also a feature of the Benelux (Brussels, Amsterdam and Utrecht), Southern Europe (Rome, Barcelona, Madrid and Milan) and Germany (Stuttgart, Hamburg and Munich). In London, prime rents remained unchanged in Q2 2017. However, the 8.3% drop in prime rents since the Brexit vote highlights the ongoing uncertainty in the market. Rents are predicted to fall further by year-end as robust completions apply upward pressure on vacancy. COPYRIGHT JONES LANG LASALLE IP, INC. 2017. All Rights Reserved 29

Looking ahead, solid occupier activity and limited development will continue to restrict the availability of high-quality space, driving up rents across Europe as a result. Prime office rental growth is expected to total around 2% per year in 2017 and 2018 with Barcelona, Stockholm and Amsterdam projected to record the strongest uplifts. Overall rental growth edges up in Asia Pacific, albeit at a slower rate Asia Pacific rents increased 3.3% year-on-year in Q2 2017. The most vigorous annual rental growth was recorded in Sydney and Melbourne, contributed to by declining incentives and increasing face rents. While supply pressure held Shanghai rents relatively stable, demand from Chinese companies contributed to robust growth in Hong Kong. Elsewhere, Singapore returned to growth with rents edging higher. Prime Offices Rental Change, Q2 2016 Q2 2017 Sydney Stockholm Toronto Chicago Brussels Hong Kong Madrid Milan Washington DC New York Los Angeles Boston Tokyo Frankfurt Mumbai San Francisco Dubai Paris Shanghai Beijing Sao Paulo Mexico City Singapore Moscow Seoul London Americas EMEA Asia Pacific % change -10-5 0 5 10 15 20 25 30 35 Based on rents for Grade A space in CBD or equivalent. In local currency. Source: JLL, July 2017 COPYRIGHT JONES LANG LASALLE IP, INC. 2017. All Rights Reserved 30

Rental change (y-o-y %) Global Market Perspective August 2017 Prime Offices Rental Change, 2010-2017 10 8 8.0% 8.3% 6 4 3.7% 4.0% 2.7% 3.0% 2 1.5% 0.8% 0 2010 2011 2012 2013 2014 2015 2016 2017F Prime office rental growth: unweighted average of 26 major markets. Source: JLL, July 2017 Prime Offices Projected Changes in Values, 2017 20-30% Rental Values Sydney Capital Values Hong Kong 10-20% Milan, Stockholm, Sydney Brussels, Frankfurt, Moscow 5-10% Stockholm, Brussels, Toronto, Washington DC Milan, Hong Kong Toronto, Singapore 0-5% Madrid, Frankfurt, Dubai*, Boston, Chicago Los Angeles, New York*, San Francisco Singapore, Mumbai, Paris*, Tokyo, Moscow Madrid, Mumbai, Tokyo, Dubai*, Boston, Chicago Los Angeles, San Francisco, New York* Washington DC, Paris*, Shanghai, Beijing 0-5% Shanghai, Beijing, Sao Paulo Mexico City, Seoul, London* Sao Paulo, Mexico City London*, Seoul *New York Midtown, London West End, Paris CBD, Dubai DIFC. Nominal rates in local currency. Source: JLL, July 2017 COPYRIGHT JONES LANG LASALLE IP, INC. 2017. All Rights Reserved 31

Prime Offices Rental Clock, Q2 2017 Beijing, Washington, DC New York Tokyo, Hong Kong, San Francisco Chicago, Dallas Shanghai Prague, Boston, Toronto Frankfurt Stockholm, Los Angeles Paris, Sydney Rental Growth Slowing Rental Values Falling Madrid, Berlin Istanbul, Seoul, Houston Milan, Amsterdam Brussels Rental Growth Accelerating Rental Values Bottoming Out London Delhi Mexico City Warsaw, Sao Paulo Mumbai Moscow, Johannesburg, Dubai, Zurich, Singapore Americas EMEA Asia Pacific Based on rents for Grade A space in CBD or equivalent. U.S. positions relate to the overall market. Source: JLL, July 2017 COPYRIGHT JONES LANG LASALLE IP, INC. 2017. All Rights Reserved 32

Retail Markets U.S. retail market approaching cyclical peak The U.S. retail sector may be reaching its zenith for the cycle. Major markets are approaching their peak, with retail performance expected to slow this year as same-store growth stagnates for many retailers, and store closures rise. Closure announcements have been accelerating in recent months, with department stores closures topping the headlines. Macy s and Sears are forecast to return approximately 18 million square feet of mall space to the market over the next year. While the upcoming vacancies will pose opportunities for strong malls to upgrade to a more productive tenant or refresh the space with an entertainment destination, weaker malls could experience a ripple effect to their in-line occupancy. Although construction activity has ramped up since the end of the recession, developers and their lenders are keeping the reins close on supply and current levels are well below what they were 10 years ago. Much of the major retail construction currently underway is for mixed-use development. Increasing population densities in urban centres are driving this trend and helping to justify soaring land costs. Structural change becoming more prominent across Europe s retail markets The continued growth of online sales, omni-channel retailing and technical innovations are forcing many retailers across Europe to review business models in order to achieve profitable growth and protect margins. As a result, major retailers are investing in their distribution networks and those with larger store portfolios are rightsizing, although demand for quality retail space remains strong. Prime retail rents remained predominantly stable during the second quarter of 2017 across all asset classes, with notable prime rental growth for retail warehouse park space in Berlin, Hamburg and Stuttgart, which rose 5.9%, 2.7% and 2.7% respectively over the quarter. Looking forward, prime high street rents in Stockholm, Copenhagen, Prague, Dublin, Madrid and Barcelona are forecast to see the most robust uplifts in the medium term. Prime shopping centre rents are expected to record the strongest growth in Hungary, the Czech Republic, Russia and Spain. F&B operators lead activity in Asia F&B operators continue to be the most active segment in Asia Pacific, which saw mixed rental trends across the region. In Shanghai, rental growth was led by malls with experienced operators in areas such as Huaihai Road and Huamu Road. High street shop rentals in Hong Kong remained under pressure, albeit with the pace of decline moderating. The Marina submarket in Singapore continued to see the most pronounced decline, in part due to supply pressures. Rents were stable in Sydney and Melbourne, where demand from F&B operators has provided support for rents; however, negative rental reversion is still being reported by many institutional landlords. COPYRIGHT JONES LANG LASALLE IP, INC. 2017. All Rights Reserved 33

Prime Retail Rental Clock, Q2 2017 London Washington DC, Beijing, Paris Boston, Houston New York, San Francisco Tokyo Los Angeles, Madrid Rental Growth Slowing Rental Values Falling Dubai, Berlin Milan, Shanghai, Chicago Rental Growth Accelerating Rental Values Bottoming Out Singapore Mumbai Delhi Hong Kong Moscow, Sydney Americas EMEA Asia Pacific Prime Industrial Rental Clock, Q2 2017 Amsterdam, Hong Kong San Francisco New York, Dallas Tokyo Beijing Philadelphia Chicago, Los Angeles Houston, Atlanta Shanghai Rental Growth Slowing Rental Values Falling Boston, London, Stockholm Milan Sydney, Frankfurt Rental Growth Accelerating Rental Values Bottoming Out Singapore Madrid Moscow Paris, Warsaw, Istanbul Americas EMEA Asia Pacific Relates to prime space. U.S. positions relate to the overall market. Source: JLL, July 2017 COPYRIGHT JONES LANG LASALLE IP, INC. 2017. All Rights Reserved 34

Industrial Markets U.S. industrial rents surge on tight supply and structural tailwinds Total net absorption in the U.S. warehouse and distribution market as a percent of total inventory trailed new deliveries for the first time in over seven years during Q2 2017. This lower level is not a sign of weakening market conditions however, and is largely attributable to the lack of quality vacant space left in the market to absorb, coupled with a decline in average size of transactions. National vacancy declined again in Q2 2017 and is now at 5.2%. Nationally, rents increased by nearly 6.5% on an annualised basis to reach US$5.35 per square foot, an all-time high. We anticipate that rents will continue on their strong upward track through the rest of 2017. The construction pipeline continues to expand, increasing in more than half of U.S. markets compared to Q1. Pre-leasing rates for both speculative and build-to-suit buildings were more robust in Q2 than the previous quarter. In particular, e-commerce and logistics distribution companies have signed more leases for buildings under construction (including proposed projects), an indication of a growing sector with a need for new functional warehouse space. European warehousing markets expected to maintain record occupier activity in 2017 Responding to continued strong online retail sales growth coupled with automation, digital alignment of distribution processes and the need for new city logistics networks, JLL's latest Supply Chain Activity Index suggests that the upward trajectory in European occupational demand will continue through 2017 with total take-up likely to exceed last years' record. As new warehousing demand continues to outpace construction and with the majority of new supply remaining firmly build-to-suit driven, the European vacancy rate is expected to edge down further through the rest of 2017 to reach around 5% at the end of the year overall. Meanwhile, high levels of occupational demand, particularly in and around major cities, should push immediatelyavailable supply in these locations down even further. As a result, we see rising upward pressure on rents with the majority of European markets anticipated to record rent increases over 2017. Demand in Asia Pacific continues to stem from 3PLs and e-commerce firms Leasing activity in Asia Pacific mainly involved 3PLs and e-commerce firms during Q2 2017. Takeup accelerated in Shanghai as space completed in the previous quarter was leased, while retailers and manufacturers expanded their warehousing space in Hong Kong. Leasing activity also picked up in Singapore, supported by the recent uplift in manufacturing and trade figures. Occupier demand in Sydney and Melbourne was robust with broad-based demand from 3PLs, manufacturing, retail goods and wholesale goods traders. Rents edged up in most markets across the region. Melbourne recorded the strongest increase following a period of little growth, while Singapore s logistics rents eased further on continued supply pressure, but at a slower pace following the pick-up in leasing momentum. COPYRIGHT JONES LANG LASALLE IP, INC. 2017. All Rights Reserved 35

Prime Logistics Yields in Major Markets, Q2 2017 United States Asia Pacific Europe 7.0% 6.5% 6.50% 6.30% 6.75% 6.0% 5.75% 5.5% 5.0% 4.5% 4.75% 4.75% 4.75% 4.50% 4.90% 4.60% 5.20% 4.90% 4.50% 4.0% 4.00% 3.90% 4.00% 3.80% 3.5% Chicago Atlanta Eastern Dallas New JerseySouthern Pennsylvania California Singapore Sydney* Beijing Shangai Hong Kong* Tokyo* Warsaw Barcelona Paris Frankfurt London Based on Class A Industrial yields in the Americas; Prime logistics yields in Europe; Indicative prime transactional yields in Asia Pacific; Average prime equivalent yield in Sydney. *Sydney Outer Central West; Tokyo Greater Tokyo; Hong Kong relates to Warehouses Source: JLL, July 2017 COPYRIGHT JONES LANG LASALLE IP, INC. 2017. All Rights Reserved 36

Hotel Markets Hospitality sector performance resilient Despite ongoing geopolitical and economic uncertainty, the travel and tourism industry continues to flourish. The latest hotel performance data have posted encouraging results with most regions recording positive RevPAR growth over the May 2017 year-to-date period. In Europe, Spain continues to deliver impressive performance with Barcelona and Madrid registering double-digit RevPAR increases driven by a record level of tourist arrivals. In Paris, RevPAR grew nearly 10% year-on-year; however, it has not yet bounced back to previous levels. In North America Canada is posting especially strong growth in hotel revenue, while the strength of the U.S. economy has extended the hotel performance growth cycle. May 2017 was the 87 th consecutive month of RevPAR growth, up 3.4% year-on-year. In Asia Pacific, Sydney and Tokyo were the top performers as RevPAR rose 13.1% and 5.9% yearon-year respectively, thanks to strong tourism demand which outstripped hotel supply. Hotel transaction volumes muted, but expected to pick up in H2 Overall investor sentiment is positive, due to improving economic indicators in key countries together with optimistic hotel performance forecasts. Nevertheless, geopolitical issues such as the French and UK elections, terrorist attacks and low oil prices resulted in investors adopting a more cautious approach in the first half of 2017. Global hotel transactional activity was therefore muted, totalling US$23 billion, 12% behind the same period last year. The Americas accounted for nearly half of global hotel transaction volumes in H1 2017 with deal activity on par with the previous year at US$11.5 billion. The U.S. was the most liquid market globally with US$9.3 billion worth of hotel transactions, supported by a notable increase in purchases by REITs, whose buying activity rose 91% year-on-year. Global Hotel Investment Volumes, H1 2016 - H1 2017 US$ billions H1 2016 H1 2017 % change H1 16-H1 17 Americas 11.4 11.5 1% EMEA 9.4 8.0-15% Asia Pacific 5.2 3.5-33% Total 26.1 23.0-12% Source: JLL, July 2017 In EMEA, Germany took the top spot for transaction volumes, recording US$1.9 billion worth of hotel deals in H1 2017, albeit this was 14% lower than last year. The country has the highest level of acquisition activity from banks and institutional investors in the region at 25%, primarily attributable to the large number of lease agreement opportunities available in the German hotel sector, which represented around 73% of total deals in H1. COPYRIGHT JONES LANG LASALLE IP, INC. 2017. All Rights Reserved 37

The UK came in second with transactions totalling US$1.8 billion. Though year-to-date UK investment volumes are still 30% behind H1 2016, there has been a higher level of deal activities in key cities. London registered a 7% year-on-year uplift in H1 2017, while regional cities such as Manchester, Bristol and Edinburgh all observed increasing activity as well, with combined investment volumes in these three cities nearly twice that of the same period last year. The Netherlands and Spain were the two Western European countries that witnessed a year-onyear increase in volumes in the first half of the year, up 77% and 44% respectively. This suggests that investors are starting to branch out to other countries that have the potential to offer better returns. Asia Pacific saw a 33% decline in transaction volumes in H1 due to a dearth in quality stock on the open market. Hong Kong, Japan and Australia were the star performers in terms of inbound investment, thanks to long-term positive tourism fundamentals and trading performance. Hong Kong recorded eight individual deals amounting to almost 2,000 rooms that sold for a combined total of US$1.2 billion, which was twenty times more than its full-year 2016 volumes. Three of the transactions were development plays and the former hotels or serviced apartment buildings recently acquired will be converted to residential. International capital continues to play a key role in the global hotel investment market, accounting for around 25% of all transactions in H1 2017. North America is the largest recipient of offshore capital with around 21% of U.S. hotel transactions involving international buyers, of which more than half were from Asian countries including mainland China. European buyers have also emerged as a major acquirer. Hotel Transactions: Capital Outflows and Inflows, H1 2017 Mainland China North America Asia Europe Middle East Australasia South America US$ billions -2.5-1.5-0.5 0.5 1.5 2.5 3.5 Outflows Inflows *Excludes multijurisdictional portfolio transactions Source: JLL, July 2017 COPYRIGHT JONES LANG LASALLE IP, INC. 2017. All Rights Reserved 38

Institutional investors checking in Institutional investors have been steadily increasingly their capital allocation to the hotel sector, with transactional activity totalling approximately US$2 billion in the first six months of 2017 compared to under US$1 billion five years ago. Deka Immobilien Investment GmbH, Union Investment and Standard Life were some of the early pioneers who invested in the sector. Since then, more companies have started to dip their toes into the sector as they look for better yields and investment diversification. Investment destinations have expanded from Germany to the U.S, the U.K, Ireland, Spain, Netherlands and Denmark. Hotel property is now being seen as a viable asset class and we expect more deal activity from institutional investors in the coming years. Chinese outbound travel boom Chinese travellers have been the largest source market in the world for international travel since 2012. The number of Chinese outbound travellers has jumped 300% from 34 million in 2006 to 135 million in 2016 and the UNWTO forecasts this number will grow to 220 million by 2025. Top destinations include Thailand, South Korea and Japan due to their proximity to China; however, Chinese travellers are starting to venture out to more distant locations such as the U.S., Germany, France and the UK. Increased disposable income, simpler visa regulations and the adoption of the Approved Destination Status system in many countries are the major drivers behind the Chinese outbound travel boom. The rise of the Chinese traveller is also prompting Chinese companies to expand overseas to capture a share of this growing market. Jin Jiang International is now the fifth largest hotel company in the world after its merger with Plateno in 2015 and 7 Days Inn, a budget brand under the Plateno group, is opening hotels in locations such as Berlin, Munich, Leipzig and Venice. While the capital restrictions imposed by the Chinese government on outbound investment have slowed down deal flow, buying activity has continued with investors moving to smaller deal sizes in regional cities. The primary effect has been on those SOEs trying to get cash out of mainland China, but many Chinese players who have funds already in offshore accounts are still active. COPYRIGHT JONES LANG LASALLE IP, INC. 2017. All Rights Reserved 39

Residential Markets Growth decelerates in U.S. rental apartments on supply wave The U.S. rental apartment market has slowed over the beginning of 2017 with national annual rental growth softening 180 bps year-on-year to 2.9% in the first quarter. This was the first quarter since year-end 2010 where rental growth has dipped below 3%. In spite of the overall declines in the pace of rental growth, eight markets saw gains in excess of 5% on the quarter, while an additional seven markets maintained rental growth in excess of 4%. Nine markets in the West region comprised the majority of market leaders on the quarter, ranging from Portland s 4.2% to Sacramento s 10.8%. Sunbelt markets made up the remaining rental growth leaders, ranging from Raleigh-Durham s 4.3% to Atlanta s 5.2%. Select markets saw declines in effective rents on the quarter, led by Houston s -2.7% fall. New York, San Francisco and Silicon Valley each experienced declines in annual effective rents of less than 1% as well. After consistent rental gains over the course of the decade, rents are showing some signs of fatigue. Yet with the current unemployment rate at 4.4%, average hourly earnings increasing 2.5% year-on-year and a domestic economy operating in a stable range of measured growth, multifamily rents appear set to expand in a similar range of consistent growth. UK institutional investment market continues rapid expansion The UK housing market has slowed over the past year with major indices suggesting annualised house price growth of circa 3% in the year to June 2017. Transaction levels have also fallen, to 1.19 million in the year to May 2017 from 1.3 million in the previous year. Prices in Central London have picked up a little during the first half of 2017 but remain subdued and are expected to be broadly flat for the rest of the year. The investment market, in contrast, has continued its remarkable growth rate and the total pipeline of institutional-grade residential stock is now over 100,000 units. In London this represents between 10% and 15% of current delivery volumes and has now become established as a credible alternative exit for many for sale schemes that have been caught out by the softer market conditions. Investors continue to chase stock outside London to improve expected yields, pushing the proportion of non-london delivery above 50% of all build-to-rent activity. Housing policy continues to evolve in ways that are supportive of further expansion in the asset class. Transactional activity remains robust in Germany The German residential investment market remained in robust shape during the first half of 2017 with total transaction volumes of 6.2 billion, a 40% rise on the same period in 2016. As in the previous few quarters, market activity was driven by small-scale transactions and the trade in project developments. COPYRIGHT JONES LANG LASALLE IP, INC. 2017. All Rights Reserved 40

The wider Berlin region continues to be the capital of the residential property investment market, with transaction volumes of almost 1.8 billion in the first six months of the year. This was 30% of the total for the whole of Germany and was attributable to an extraordinarily high proportion of international investors (35%). The lively deal flow is expected to carry on in the second half of the year, dominated by project developments, and in some cases, high-volume sub-portfolios as a result of portfolio rationalisations. Transactional activity of 15-17 billion is expected for the full-year 2017, which is 50%-70% above the 10-year average. Investor demand pushes yields to historic lows in the Netherlands The investment market experienced a strong first half of 2017 in the Netherlands, although a lack of suitable large-scale product weighed on total investment volumes for residential space. Nevertheless, demand remains high with investor interest spreading across the country due to limited supply in the major markets, where pricing sharpened further in H1 with prime net initial yields standing at historical low levels. The owner-occupier market also witnessed robust performance. As a result of the ongoing elevated levels of demand, prices have risen strongly with the average transaction price up by 9% on last year and standing 2% above the level achieved in 2008. The number of available premises for sale has fallen to its lowest point in 13 years, with the shortage of supply potentially leading to further price increases. Current price levels may be touching the boundaries of affordability once interest rates start to increase. Housing market confidence continues to improve in Spain The housing market in Spain is continuing to benefit from strong economic fundamentals with total investment volumes (for residential and land) in H1 2017 of 888 million. A significant supply of new developments is coming on stream during 2017 and more developments are being sold offplan in Madrid, Barcelona and Malaga, boosting confidence in the market. Residential capital values and rents are continuing their upward trend. Developers are betting strongly on residential development with a significant volume of land sales evident in Q2, and the market is continuing its process of professionalisation with Aedas, Castlelake s Spanish development arm, preparing to follow Neinor with an IPO in Q4 2017. Strong price growth in Portuguese residential market The Portuguese residential market continued to see robust price growth in Q2 2017. With supply of newly-available housing being taken up at a fast rate, there is a shortage of product at the medium to high end of the supply spectrum. Demand in the upper segment of the market and in city centre locations is being driven primarily by international capital, due to affordability constraints on domestic buyers. COPYRIGHT JONES LANG LASALLE IP, INC. 2017. All Rights Reserved 41

Policy restrictions continue in China; sentiment improves in Singapore Tightening measures remained in the spotlight in Greater China with new policy measures rolled out and existing restrictions adjusted in many cities during the quarter. In Hong Kong, the 15% stamp duty levy was extended to first-time buyers of multiple properties and some financing criteria for developers and select homebuyers were tightened. Despite policy restrictions the market upswing in Hong Kong continued, with strong demand for new mass residential launches. By contrast, sales volumes in Shanghai remained low due to the tight policy stance and limited supply. In Singapore, sales transactions in the prime districts are likely to show further gains from last year, reflecting healthier levels of demand. Rental growth was limited in most Asian markets. Modest quarterly rental gains were recorded in China s Tier 1 cities against steady leasing demand while Hong Kong s luxury rents rose for the first time in seven quarters, supported by an uptick in leasing in large part due to seasonal factors. Rental declines in Singapore s prime areas eased, supported by improved demand as attractive rents enticed tenants from outside districts. COPYRIGHT JONES LANG LASALLE IP, INC. 2017. All Rights Reserved 42

Key Investment Transactions in Q2 2017 Europe, Middle East and Africa Country City Property Sector Sales price US$m Comments Denmark Denmark Copenhagen AC Hotel Bella Sky Copenhagen Copenhagen Copenhagen Portfolio (four hotels) Hotel 245 Norwegian investor Wenaasgruppen has purchased the property, the largest hotel in Denmark, on a saleand-leaseback basis. Hotel 114 Property company Fastighets AB Balder has acquired the properties, which are all located next to the central train station in Copenhagen. France Paris Vivacity Office 404 Blackstone has sold the 23,250 sq m complex to Amundi Real Estate. The sale represented a net yield of 3.4%. Germany Munich Pullman Hotel Munich Germany Various Corestate Retail Portfolio Germany Various Geneba Properties Portfolio Italy Various Centraline telefoniche Hotel 119 The property has been purchased by Singapore REIT CDL Hospitality Trust. Retail 757 Universal Investment, a fund manager of Bayerische Versorgungskammer has acquired the portfolio, comprising 90 properties with a total lettable area of approximately 290,000 sq m, located across 74 German cities. Industrial 474 Frasers Centrepoint has acquired an 86.56% stake in Geneba Properties, an Amsterdam-based listed real estate investment company specialising in German and Dutch logistics and industrial assets from Catalyst RE Coöperatief. Alternatives 683 Crédit Agricole Assurances and EDF Invest have purchased the telecom portfolio of 150 assets spread across Italy from the property company Beni Stabili. Netherlands Amsterdam DoubleTree by Hilton Amsterdam Centraal Station Hotel 394 Blackstone has sold the property to Asian investor Anbang Capital. Netherlands Amsterdam Atrium Office 572 Amundi Real Estate has purchased the 60,000 sq m property in the largest ever transaction in the Dutch office sector. Tenants include CMS, Hogan Lovells, Optiver, Vistra, Celanese and JLL, with rents ranging between 365 and 400 per sq m per year. Netherlands Various Q-Park Portfolio Alternatives 527 The portfolio, comprising nine assets of Q-Park's car park portfolio located in Amsterdam, Rotterdam, Maastricht and The Hague and offering a combined 300,000 sq m of space, has been sold to private equity firm Kohlberg Kravis Roberts (KKR). COPYRIGHT JONES LANG LASALLE IP, INC. 2017. All Rights Reserved 43

Country City Property Sector Sales price US$m Comments Spain Playa del Ingles, Gran Canaria IFA Portfolio Hotel 119 HI Partners has bought the portfolio of three budget hotels from hotel operator Lopesan Hotels & Resorts, which will continue to manage the hotels. UK London Grosvenor House Hotel UK London Cannon Place Hotel 768 GH Equity UK has purchased the iconic hotel, currently managed by Marriott and comprising of 420 rooms, 74 suites and 27 conference rooms. Office 621 Deka Immobilien has purchased the landmark City of London building, offering 38,851 sq m of grade A office as well as 754 sq m of retail space. The sale represented a net yield of 4.4%. Asia Pacific Country City Property Sector Sales price US$m Comments Australia Melbourne Victoria Police HQ Australia Sydney Home Hub Castle Hill Office 261 Australia Postal Corporation has sold a 50% interest in the property with a total acquired floor area of 65,000 sq m to Keppel REIT in a deal worth A$348 million. Retail 252 Aventus Property Group has purchased the home and lifestyle centre from LaSalle Investment Management in a deal worth A$336 million. The site features a total of 52,004 sq m and was transacted at a yield of 5.5%. Australia Sydney MLC Centre Office 543 DEXUS Wholesale Property Fund has purchased a 50% interest in the building in a A$723 million deal. The 62- storey property has potential for redevelopment with a number of underutilised floors. Australia Sydney Exchange Centre Australia Sydney Four Points by Sheraton Sydney, Central Park China Beijing Taohui Xintian Shopping Mall Office 252 Kumpulan Wang Persaraan (KWAP) has sold off 17,872 sq m of fully-let space to Early Light International Group in a deal worth A$335 million. The transaction was completed on an estimated initial yield of 3.9%. Hotel 142 The 297-room hotel has been sold to investment fund Impact Investment Group by Frasers Hospitality. Retail 321 A private Hong Kong Investor has bought a 75% stake in the mall in a JV with Nan Fung Group from InfraRed Capital Partners. The deal was worth RMB 2.2 billion. COPYRIGHT JONES LANG LASALLE IP, INC. 2017. All Rights Reserved 44

Country City Property Sector Sales price US$m Comments China Guangzhou Metropolitan Plaza China Shanghai Hongkou SOHO China Shanghai Guozheng Centre Retail 592 Link REIT has acquired the five-storey mega mall with approximately 88,000 sq m GFA of retail space from Gaw Capital Partners for approximately RMB 4.07 billion. The transaction was completed on a gross yield of 4.7%. Office 521 Keppel Land China and Alpha Investment Partners, both of which are subsidiaries of Keppel Group, have purchased the property in a JV for RMB 3.57 billion. The building has a total GFA of 90,000 sq m which includes an estimated 70,000 sq m of leasable area. Office 385 CapitaLand has purchased the building from Shanghai Baohua Group for RMB 2.64 billion, based on a total GFA of 80,701 sq m. The total occupancy rate stood at 29% in April 2017. China Shanghai H88 Tower Office 277 SEA Group has acquired the 55,879 sq m building from Everbright Ashmore in a deal worth RMB 1.9 billion, at a unit price of RMB 35,000 per sq m. Hong Kong Hong Kong Rosedale Hotel Hotel 193 The Bank of China has sold off its 100% stake in the hotel to a private investor. Hong Kong Hong Kong The Wellington Office 385 Nan Fung Group has sold the property to a local investor for HK$3 billion. The site features a total floor area of 9,290 sq m and the deal was completed on a net yield of 2.1%. Hong Kong Hong Kong Butterfly on Hollywood Hotel 111 UK company Travelodge has bought the budget hotel from Alpha Investment Partners. India Mumbai / Delhi Industrial JV Industrial 500 CPPIB has entered into a JV with IndoSpace focused on acquiring completed modern industrial and logistics assets in India with an initial acquisition of nine assets, measuring 9 million sq ft. CPPIB will commit a further US$700 million on IndoSpace Core acquiring an additional 11 million sq ft within the next two years. Japan Osaka Dojima Hotel Japan Tokyo Shinagawa Seaside TS Tower Japan Yokohama TOC Minato Mirai Hotel 90 Japanese investment fund GK Falcon has sold the 76- bedroom hotel. Office 270 Takeda Pharmaceutical Co. has sold the 23-storey office building to EGW Asset Management for JPY 30 billion. The building has a total floor area of 43,892 sq m and was purchased with Korean investor funds. Mixed 530 Hulic Co., Ltd. and a minority listed real estate company have acquired the office and retail portion of the property, with a total floor area of 90,564 sq m, in a joint venture. COPYRIGHT JONES LANG LASALLE IP, INC. 2017. All Rights Reserved 45

Country City Property Sector Sales price US$m Comments Japan Yokohama Concurred Yokohama Office 343 Daiwa Office REIT SPC has acquired a 75% stake in the property from Yokohama TMK for JPY 38 billion. The 20-storey property has a GFA of approximately 52,773 sq m and the purchase was completed on a net yield of 4.6%. Americas Country City Property Sector Sales price US$m Comments Brazil Belo Horizonte Bouvelard Corporate Tower Office 86 Aliansce Shopping Centers S.A. has acquired the 20,400 sq m tower at a reported 8% initial yield from fund manager CTBH Fundo de Investimento Imobiliário FII. Brazil Multiple Centenario Plaza Office 135 BR Properties has purchased the two-building portfolio from pension fund Caixa de Previdencia dos Funcionarios do Banco do Brasil - Previ. Canada Montreal SNC-Lavalin HQ Office 128 GWL Realty Advisors has acquired the more than 33,000 sq m property from SNC-Lavalin. Canada Toronto Ontario Power Building Canada Toronto 8875 Torbram Road Canada Vancouver 4190 Still Creek Drive Mexico Monterrey Saqqara Edificio I U.S. Dallas 3000 Cantrell Sansom Rd U.S. Detroit Troy Officentre Office Industrial Office Office Industrial Office 322 KingSett Capital has purchased the approximately 111,000 sq m CBD asset from Ontario Power Generation. 118 Carttera has sold the nearly 83,000 sq m warehouse asset, located in Brampton, to Concert. 83 Fortinet has purchased the nearly 27,000 sq m suburban property from Holdings 1504 Enterprises. 37 Mexican REIT Fibra Uno has acquired the 11,200 sq m asset, located in San Pedro Garza Garcia, from IDEI. 75 Transpacific Development Company has purchased the 66,200 sq m warehouse asset from Deutsche Post AG. 55 Hayman Co. has acquired the 67,700 sq m asset from Osprey Management. U.S. Hampton Roads Two Commercial Place Office 57 The RMR Group has purchased the 26,800 sq m downtown Norfolk property from Marathon Development Group at a reported 7% initial yield. U.S. Honolulu - Oahu Pacific Beach Hotel Hotel 515 Highgate Holdings has sold the 837-room, 4-star resort to German investor Commerz Real Investmentgesellschaft mbh (CRI). COPYRIGHT JONES LANG LASALLE IP, INC. 2017. All Rights Reserved 46

Country City Property Sector Sales price US$m Comments U.S. Houston Ikea Distribution Center U.S. Las Vegas The Gramercy U.S. Los Angeles One California Plaza U.S. Los Angeles Riverside Plaza U.S. New York 245 Park Avenue U.S. New York Dumont NYC - an Affinia Hotel Industrial Office Office Retail Office Hotel 64 Clay Development has sold the approximately 92,600 sq m distribution centre to Pure Industrial REIT. 62 The Koll Company has acquired the 17,400 sq m asset, located in suburban Spring Valley, at a reported 6.9% initial yield from The Krausz Companies, Inc. 459 A JV of Rising Realty Partners and Colony NorthStar has purchased the nearly 90,500 sq m CBD tower from Beacon Capital Partners and Madison International. 166 Vestar Development has sold the 37,500 sq m shopping centre to AEW. 2,210 China's HNA has acquired the approximately 160,200 sq m tower from Brookfield Asset Management and Clarion Partners at a reported 5.2% initial yield. 118 Pebblebrook Hotel Trust has sold the hotel to LeFrak Organization, marking Pebblebrook s exit from New York City. The majority of its assets are now on the West Coast, with multiple properties in Los Angeles, San Francisco and Portland. COPYRIGHT JONES LANG LASALLE IP, INC. 2017. All Rights Reserved 47

Illustrative Office Occupational Transactions in Q2 2017 Europe Country City Property Tenant Industry Sector Floorspace sq m France Paris Centre Marine Pépinière Gide Legal Services 18,000 France Paris Opus 12 Deloitte Business Services 9,500 France Paris Docks en Seine Régime Social des Indépendants Public Administration 8,700 France Paris Coeur Défense Nextdoor Business Services 4,500 Germany Cologne Von-Gablenz-Strasse 2-6, Messe/Deutz Federal Office of Family and Civic Affairs Public Administration 18,600 Germany Cologne Strabag HQ, Messe/Deutz Strabag AG Construction 17,000 Germany Frankfurt Junghof Plaza Clifford Chance Deutschland Legal Services 11,800 Germany Hamburg Olympus Corporate Center Olympus Manufacturing 34,500 Russia Moscow White Stone TH Solpro Manufacturing 3,018 Russia Moscow LeFort DPD Business Services 2,821 Russia Moscow 7 Alexander Solzhenitsyn st. FGUP VO Bezopasnost Energy 2,428 Russia Moscow Krasnaya Roza - Demidov Shire Manufacturing 2,402 UK London 2 Southbank Place, SE1 WeWork Business Services 26,333 UK London LSQ London, SW1 Hearst Magazines Media 6,661 UK London London Fruit and Wool Exchange, Brushfield Street, E1 NEX Group Banking & Financial Services 11,170 UK London Angel Court, EC2 BUPA Healthcare 5,202 Asia Pacific Country City Property Tenant Industry Sector Floorspace sq m Australia Brisbane 180 Brisbane, 180 Ann Street Origin Energy Utilities 16,329 Australia Sydney Wynyard Green, 11-31 York Street Property NSW Public Administration 17,244 COPYRIGHT JONES LANG LASALLE IP, INC. 2017. All Rights Reserved 48

Country City Property Tenant Industry Sector Floorspace sq m Australia Sydney International Towers Sydney Tower 1, 100 Barangaroo Avenue Baker McKenzie Business Services 7,000 China Beijing Sinotrans Building ZTE ITES 9,500 China Shanghai HKRI Centre One EA ITES 6,400 China Shanghai Bund Finance Center, N2 Bank of Hangzhou Banking & Financial Services 8,800 Hong Kong Hong Kong Hong Kong Lincoln House BNP Banking & Financial Services Hong Kong Two Pacific Place Huarong Banking & Financial Services 7,988 3,479 India Delhi DLF Building 6 Optum Global Solutions ITES 699 India Mumbai Adani Inspire Apex Entertainment Media 3,623 Japan Tokyo* Nishi Shinagawa 1-Chome District Redevelopment Project Sega Sammy Group Manufacturing 44,000 Japan Tokyo* Shibuya Hikarie Adastria Retail 11,000 Malaysia Kuala Lumpur Menara Prestige American Express Banking & Financial Services 8,361 Singapore Singapore Republic Plaza II PartnerRe Business Services 900 Singapore Singapore Chevron House CIT Aerospace Business Services 396 South Korea Seoul Samsung HQ Bank of Korea Banking & Financial Services 30,000 *JLL estimate Americas Country City Property Tenant Industry Sector Floorspace sq m Brazil Brazil Rio de Janeiro Rio de Janeiro L'Oréal L'Oréal Consumer Goods 15,489 Torre Almirante WeWork Business Services 7,284 Brazil São Paulo Avenida Brigadeiro Faria Lima, 4100 Cosan Energy 7,668 Canada Calgary Intact Place Intact Insurance Banking & Financial Services 15,583 COPYRIGHT JONES LANG LASALLE IP, INC. 2017. All Rights Reserved 49

Country City Property Tenant Industry Sector Canada Toronto 81 Bay Street CIBC Banking & Financial Services Canada Toronto 2650 Yonge Street CIBC Banking & Financial Services Floorspace sq m 162,579 9,290 Canada Toronto 33 Bloor St E Omnicom Media 9,290 Canada Vancouver The Exchange Executive Exchange Hotel Limited Partnership Travel and Tourism 10,229 Mexico Mexico City The Tower Park Plaza WeWork Business Services 9,200 U.S. Boston The Innovation and Design Building Reebok Consumer Goods 20,439 U.S. Dallas Plano Parkway @ Parker Road AmerisourceBergen ITES 27,871 U.S. Indianapolis One West Ascension Healthcare 13,750 U.S. New York 375 Pearl Street New York City Human Resources Administration Public Administration 19,881 U.S. Phoenix RIO2100 Freedom Financial Banking & Financial Services 27,871 U.S. Raleigh- Durham MetLife III MetLife Banking & Financial Services 20,346 U.S. San Francisco 1 Front Street First Republic Banking & Financial Services 16,630 U.S. Seattle- Bellevue The Mark F5 ITES 47,893 U.S. Washington DC Portals Phase II U.S. Pension Benefit Guaranty Corporation Public Administration 40,041 Global Real Estate Health Monitor Definitions and Sources Metro Area GDP: Change in Real GDP. Metropolitan Area Projection, 2017. Source: Oxford Economics City Investment Volumes: Direct Commercial Real Estate Volumes. Metro Area Data. Rolling Annual Total in USD Billion. Source: JLL City Investment Volumes Change: Direct Commercial Real Estate Volumes. Metro Area Data. Rolling Annual Change. Source: JLL Capital Value Change: Notional Prime Office Capital Values. Year-on-Year Change. Latest Quarter. Source: JLL Prime Yield: Indicative Yield on Prime/Grade-A Offices. Latest Quarter. Source: JLL Yield Gap: Basis Points that Prime Office Yields are above or below 10-year Government Bond Yields. Latest Quarter. Source: JLL, Datastream Rental Change: Prime Office Rents. Year-on-Year Change. Latest Quarter. Source: JLL Net Absorption: Annual Net Absorption as % of Occupied Office Stock. Rolling Annual. Source: JLL Vacancy Rate: Metro Area Office Vacancy Rate. Latest Quarter. Source: JLL Supply Pipeline: Metro Area Office Completions (2017-2018) as % of Existing Stock. Source: JLL COPYRIGHT JONES LANG LASALLE IP, INC. 2017. All Rights Reserved 50

For further information contact: Jeremy Kelly Director Global Research Jeremy.Kelly@eu.jll.com Matthew McAuley Senior Analyst Global Research Matthew.Mcauley@eu.jll.com About JLL JLL (NYSE: JLL) is a leading professional services firm that specialises in real estate and investment management. A Fortune 500 company, JLL helps real estate owners, occupiers and investors achieve their business ambitions. In 2016, JLL had revenue of $6.8 billion and fee revenue of $5.8 billion and, on behalf of clients, managed 4.4 billion square feet, or 409 million square meters, and completed sales acquisitions and finance transactions of approximately $136 billion. At year-end 2016, JLL had nearly 300 corporate offices, operations in over 80 countries and a global workforce of more than 77,000. As of December31, 2016, LaSalle Investment Management has $60.1 billion of real estate under asset management. JLL is the brand name, and a registered trademark, of Jones Lang LaSalle Incorporated. For further information, visit www.jll.com. About JLL Research JLL s research team delivers intelligence, analysis and insight through market-leading reports and services that illuminate today s commercial real estate dynamics and identify tomorrow s challenges and opportunities. Our more than 450 global research professionals track and analyse economic and property trends and forecast future conditions in over 60 countries, producing unrivalled local and global perspectives. Our research and expertise, fuelled by real-time information and innovative thinking around the world, creates a competitive advantage for our clients and drives successful strategies and optimal real estate decisions. Our regional offices Chicago 200 East Randolph Street Chicago, IL 60601 +1 312 782 5800 London 30 Warwick Street London, W1B 5NH +44 (0)20 3147 6040 Singapore 9 Raffles Place #39-00 Republic Plaza Singapore 048619 +65 6220 3888 COPYRIGHT JONES LANG LASALLE IP, INC. 2017. All Rights Reserved 51