SE Asia: Brooke PerspectivesSE Asia: Brooke Perspectives

Key Demographics Key Demographics

AsiaAsia EuropeEurope(25 countries)(25 countries)

USAUSA

3.8 billion3.8 billion 455 million455 million 290.5 million290.5 million

42.35m s.km42.35m s.km 3.89m sk.m3.89m sk.m 9.16m s.km9.16m s.km

US$4,969US$4,969

(per capita)(per capita)

US$23,600US$23,600 US$36,300US$36,300

Labour forceLabour force 1.72 billion1.72 billion 220 million220 million 142 million142 million

-2.5

-1

0.5

2

3.5

5

6.5

8

9.5

1999a 2000a 2001a 2002a 2003b 2004c 2005c

GDP Growth

20.4

8

5.7

5.4

2.2

1.2

0.92

0.7

0.5

0 5 10 15 20 25

Japan

Singapore

Taiwan

Hong Kong

Malaysia

Thailand

China

Philippines

Indonesia

Summary of Labour Cost per Hour (US$)

* For production workers. Includes pay for time worked, other direct pay (eg. holiday pay), employer expenditures on legally required insurance programmes and other labour taxes.

Consumption Trends in Asia Consumption Trends in Asia 2003/20042003/2004

-2

0

2

4

6

8

10

Ko

rea

Tai

wan

Jap

an

Ho

ng

Ko

ng

Ind

ia

Ind

on

esia

Ph

ilip

pin

es

Au

stra

lia

Th

aila

nd

Sin

gap

ore

Mal

aysi

a

Ch

ina

Asi

anA

vera

ge

%YoY

2003 1Q04

India: the next China ?India: the next China ?Improving economy Improving economy but FDI only US$3.4 but FDI only US$3.4 billion in 2003/4billion in 2003/4Increased spending on Increased spending on infrastructure plannedinfrastructure plannedOpening up of the Opening up of the telecom and real telecom and real estate markets to estate markets to foreign investorsforeign investorsOutsourcing from US Outsourcing from US and Europe continuesand Europe continues47 million new homes 47 million new homes requiredrequired

SingaporeSingaporeOver 8% GDP Over 8% GDP

growth in 2004 but growth in 2004 but expected to slow expected to slow

Retail sales slowingRetail sales slowingRecovery in property Recovery in property

markets mixed but markets mixed but activity increasing and activity increasing and 4 REITS planned4 REITS planned

Recent sale and Recent sale and leaseback of HSBC leaseback of HSBC BuildingBuilding

IndonesiaIndonesia

Recovery at last Recovery at last 2004 GDP growth was 2004 GDP growth was 5.1% and set to increase 5.1% and set to increase in 2005in 2005Consumer spending up – Consumer spending up – 50% increase in vehicle 50% increase in vehicle salessalesFDI tripled in 2004 y/y FDI tripled in 2004 y/y Stock exchange at record Stock exchange at record highhighStability improvingStability improving

MalaysiaMalaysia

Strong trading growth Strong trading growth and pressure to and pressure to revalue currencyrevalue currencyVacancies in over-Vacancies in over-invested property invested property markets decliningmarkets decliningStrong retail growth Strong retail growth with consumer with consumer spending upspending upIncreased inward Increased inward investment in the investment in the manufacturing sectormanufacturing sector

ThailandThailandImproving economy and Improving economy and

lower unemploymentlower unemploymentIncreased consumer Increased consumer

spending and auto industry spending and auto industry growinggrowing

Foreign funds returned to Foreign funds returned to the stock marketthe stock market

Jump in foreign invested Jump in foreign invested projects since electionprojects since election

Risk of instability in Risk of instability in southern provincessouthern provinces

PhilippinesPhilippines

6.4% GDP growth in 6.4% GDP growth in 2004 highest since 2004 highest since 19961996Domestic demand up Domestic demand up by 6.7%by 6.7%Increased foreign Increased foreign investment in call investment in call centres and business centres and business services outsourcingservices outsourcingIndustrial sector Industrial sector strengtheningstrengthening

Regional TrendsRegional TrendsGrowth in consumerismGrowth in consumerismInflux of overseas fundsInflux of overseas fundsHigher community Higher community aspirationsaspirationsInterest in REITSInterest in REITSIntegration of Integration of transportation/real transportation/real estate developmentestate developmentTourism as an Tourism as an investment driverinvestment driverSustainabilitySustainability

Regional ChallengesRegional Challenges

Mega cities and urban Mega cities and urban planningplanningUrban densities and Urban densities and housing provisionhousing provisionIntegration of Integration of city/regional planningcity/regional planningRegeneration v new Regeneration v new townstownsConservation of Conservation of heritage assetsheritage assets

Investment Difficulties – Regulatory BarriersInvestment Difficulties – Regulatory Barriers

Indonesia Local partner needed All foreign remittance transactions over US$10,000 or its equivalent must be

reported to Central Bank of Indonesia

Malaysia Local partner needed The National Land Code restricts the acquisition of land by non-citizens and

foreign companies

Philippines Local partner needed Foreigners cannot own land in the Philippines except in cases of hereditary

succession Foreign interest in a residential project cannot exceed 40%

India Repatriation of foreign capital invested in real estate is not allowed for foreign citizens & foreign companies

Funds for acquire or hold property in India must be provided by way of inward remittance of foreign currency

Thailand Local partner needed Foreigners cannot hold title to land but are allowed to purchase leasehold

interests

Regional Office Total ReturnsRegional Office Total Returns

CitiesCitiesAverage 5 YearAverage 5 Year

Total Return (%)Total Return (%)Seoul (CBD)Seoul (CBD) 23.423.4

BangkokBangkok 14.514.5

JakartaJakarta 12.212.2

BeijingBeijing 11.211.2

KL (City Centre)KL (City Centre) 7.47.4

Shanghai (Pudong)Shanghai (Pudong) 6.66.6

Shanghai (Puxi)Shanghai (Puxi) 3.93.9

Hong Kong (Central)Hong Kong (Central) 1.91.9

Manila (Makati)Manila (Makati) 0.60.6

Singapore (Raffles Place)Singapore (Raffles Place) -2.1-2.1

TokyoTokyo -5.4-5.4

Chasing the Tourism DollarChasing the Tourism Dollar

National/City approach to creating world class National/City approach to creating world class tourist destinations - very strong competitiontourist destinations - very strong competitionDevelopment of family tourism – Disney and Development of family tourism – Disney and Ocean Park, Universal Studios and Sentosa Ocean Park, Universal Studios and Sentosa Emergence of Macau as the Las Vegas of Asia Emergence of Macau as the Las Vegas of Asia and integration of gambling/entertainmentand integration of gambling/entertainmentThailand, Japan and Taipei legalising casinos – Thailand, Japan and Taipei legalising casinos – Hong Kong and Singapore consideringHong Kong and Singapore consideringVietnam, South Korea and the Philippines Vietnam, South Korea and the Philippines expanding existing casino operations expanding existing casino operations

Office Market TrendsOffice Market Trends

Steady/CoolingDown

WarmingUp

CoolingFurther

HotterStill

Hong KongTokyo

Hong KongTokyo

ShanghaiManila

ShanghaiManila

TaipeiJakarta

Ho Chi Minh

TaipeiJakarta

Ho Chi Minh

SingaporeBangkok

Kuala LumpurBeijingSeoul

SingaporeBangkok

Kuala LumpurBeijingSeoul

Sunny

Chilly

Professional Professional Property Services Property Services

LimitedLimited

PPPPSS