Strong finish to 2017, outlook firm

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1 Colliers Quarterly SINGAPORE INVESTMENT Q February 218 Strong finish to 217, outlook firm Tricia Song Director and Head Research Pearl Lok Senior Manager Research In Q4 217, the Singapore investment sales market grew 9% QOQ and 43% YOY to SGD12.5 billion (USD9.4 billion) on residential and commercial deals. For the whole of 217, investment sales reached SGD4.3 billion (USD3.1 billion), up 55% from an already strong 216, and capping the best year since 27. We expect the positive momentum to carry into 218, likely driven by the buoyant investor sentiment and expected multi-year upcycle in the underlying residential sales and office leasing markets. Singapore remains one of the most attractive investment destinations in Asia. Record year since 27 Based on Colliers International's data as at 12 January 218, total property investment sales in Singapore grew 43% YOY to SGD12.5 billion (USD9.4 billion) in Q4, the strongest quarter since Q Coupled with the strong first nine months, 217 recorded the highest property investment sales since 27. Q4 was a continuation of Q3, led by land acquisition activities in the residential sector followed by the conclusion of a few major income properties in the commercial sector. Total Investment Sales by Sector: Q4 217/ 217 Q4 217: SGD12.5 billion Forecast at a glance Total Investment Sales After growing 55% in 217, we expect the investment sales market to maintain its positive momentum and grow 12% YOY to SGD44-48 (USD33-36) billion in 218. Commercial Commercial (office, retail) investment sales made up 3% of the pie in 217, and we expect investors to stay interested given the rising office market. Residential Residential sector made up 54% of the investment sales in 217. We expect developers to continue replenishing their land banks.. Industrial Industrial sector made up 1% of investment sales in 217. We expect interest in industrial properties to pick up as we expect rents to bottom out into 218. Notes: 1) Information as at 12 January 218 2) Investment sales transactions include a) all private property sales at transaction prices of SGD5 million and above; and b) all successfully awarded state land tenders. 3) Commercial includes office, retail and mixed- office and retail components in a development. Mixed use refers to properties with two or more types of different uses. Others include properties such as medical centres, HDB shops, petrol stations, etc. 4) Exchange rate as at 31 December 217 stands at USD1: SGD ) The percentage does not add up due to rounding effect.

2 217 roundup For the whole year, investment sales grew 55% YOY to SGD4.3 (USD9.4) billion, backed by buoyant acquisition activity in the residential sector (SGD21.7 billion) and commercial sector (SGD12. billion). The strong momentum will likely continue into 218. Based on Colliers' 218 Asia Pacific Outlook 1, we expect firm economic conditions and persistent low real interest rates to drive investment property markets in 218 in Asia, including Singapore. In addition, with the residential market on the cusp of a sustained recovery, developers are likely to continue landbanking in 218, via state land tenders as well as private collective sales or en bloc sales. Snapshot of total investment sales Transaction Value ('SGD, URA, JTC, HDB The top five largest transactions in 217 Period (Quarter) Name of Transacted Price (in SGD Price psf Q2 217 Jurong Point (retail) 2,199.3 $3,342 ppr Q3 217 Q4 217 Q2 217 Q , 4, 35, 3, 25, 2, 15, 1, 5, Total investment sales YOY chg % Asia Square Tower 2 (Office) 2,94. $2,689 on NLA Commercial Land parcel at Beach Road 1,622. $1,76 ppr Commercial & Resi Land parcel at Upper Serangoon Road 1,132. $1,181 ppr Resi Land parcel at Stirling Road 1,2.72 $1,51 on NLA Source: Colliers International, URA, The Business Times 25% 2% 15% 1% 5% % -5% -1% % YOY growth Commercial Record commercial deals in 217 In Q4, total commercial investment sales grew 9.8% QOQ to SGD3.1 billion (USD2.3 billion). However, on a year-on-year basis, the total was 32% lower, as Q4 216 was boosted by a large government land sale. This brings 217 commercial investment sales to a record SGD12. billion (USD9. billion), up 6.4% YOY. Major deals in Q4 included: the commercial land parcel at Beach Road, Chevron House and PoMo. The largest commercial property deal in 217 was Jurong Point (retail) at SGD2.2 (USD1.7) billion in Q2 217, followed by the Asia Square Tower 2 (office) at SGD2.9 (USD1.6) billion during Q Commercial Investment Sales Value by Type Transaction Value (SGD 5, 4, 3, 2, 1, Major Commercial Transactions in Q4 217 Q4 216Q1 217Q2 217Q3 217Q4 217 Price (SGD Price/sq ft (SGD) Chevron House 66. 2,526 on NLA PoMo ,94 on NLA Government Land Sales Beach Road 1,622 1,76 psf ppr Sources: Colliers International Singapore Research, URA 5% 4% 3% 2% 1% % -1% Oxley Holdings Everfit Sage Pte Ltd (Gaw Capital) %QOQ Change Guocoland & Guoco Group 1 Colliers 218 Asia Pacific Outlook (1 January 218) 2 Colliers Quarterly Q4 217 Singapore Investment Colliers International

3 Residential Residential investment sales highest since 27 The residential sector grew 49% QOQ and 184% YOY to SGD8.3 (USD6.2 billion) in Q4, driven mainly by the revival of collective sales, state land tenders and landed housing. This brings 217 residential investment sales to SGD21.7 (USD16.2) billion, up 119% YOY. Developers sourcing for suitable sites to replenish their depleting land banks have also led to an active collective sale market and keen bidding for sites offered through state land tenders in 217. Residential Investment Sales Value by Type Transaction Value (SGD 9, 8, 7, 6, 5, 4, 3, 2, 1,, URA Public land sales: Benchmark price for GLS site In Q4, the public investment sales segment grew 31.5% QOQ and five-fold YOY to SGD1.5 (USD1.1) billion, mainly due to the award of two pricey residential Government Land Sales (GLS) sites in the prime districts of 9 and 1. These sites at Jiak Kim Street and Fourth Avenue drew 1 and seven very competitive bids with narrow winning margins of.6% and 2% respectively. Bid Spread of Residential GLS Sites Awarded in Q4 217 Land Parcel No. of s Top bid % premium over 2nd 1% 8% 6% 4% 2% Top bid % premium above last Jiak Kim Street 1.6% 3.7% Fourth Avenue 7 2.% 14.% Note: 1) Jiak Kim Street is zoned "Residential with commercial at 1st storey", URA % -2% Q4 216 Q1 217 Q2 217 Q3 217 Q4 217 % QOQ Change setting a new price benchmark for residential GLS site at SGD1,733 (USD1,313) psf ppr. Fourth Avenue was awarded to Allgreen Holdings for SGD553. (USD419) million or SGD1,54 (USD1,167) psf ppr. Private sector: boost from collective sales in 217 In Q4, the private residential segment surged 53% QOQ and 153% YOY to SGD6.8 (USD5.1) billion, mainly driven by collective sales. For the whole year of 217, collective sales made up 37%. Total residential investment sales by type: 217 The collective sales wave A total of 27 residential collective sales with a combined value of SGD8.13 billion (USD6.2) billion were transacted in 217, making 217 the best showing since 27 when SGD11.6 (USD7.7) billion was transacted. In addition to the 12 sites worth SGD3.6 (USD2.7) billion that were sold in preceding quarters, 15 residential collective sale sites worth SGD4.5 billion were transacted in Q4. Most of the successful bid prices were done at premiums, some up to 3%, above the asking prices. We estimate over 13, units could be redeveloped on the 27 collective sale sites sold in 217, and these could be completed between 221 and 223. Developers may become more selective, but we envisage reasonablypriced sites with strong locational attributes would still appeal to developers. Given the success of residential collective sales, more owners of strata-titled commercial and mixed developments are also jumping on the bandwagon. As such, we expect the overall collective sales market to remain active in 218. The Jiak Kim Street site was eventually awarded to Frasers Centrepoint for SGD955.4 (USD724) million, 3 Colliers Quarterly Q4 217 Singapore Investment Colliers International

4 Difference in asking prices and transacted prices for residential collective sales in 217 Name of Development One Tree Hill Asking Price (SGD Transacted Price (SGD % Difference Date of Transaction % May 217 Rio Casa % May 217 Goh & Goh Building Eunosville % May % May 217 The Albracca % July 217 Serangoon Ville Tampines Court % July % Aug 217 Sun Rosier % Sept 217 Jervois Nanak Mansions % Sept % Sept 217 Amber Park % Oct 217 Changi Normanton Park Florence Regency Dunearn Court Mayfair How Sun Park % Oct % Oct % Oct % Oct % Nov % Nov 217 Crystal Tower % Nov 217 Balmoral Mansions % Nov 217 Royalville % Dec 217 Vista Park % Dec 217 Parkway Mansion % Dec 217 Derby Court % Dec 217 Note: Excluded collective sales of Toho Green, 6 townhouses in Seraya Crescent, Apartment 8 and Casa Contendere, as there were no reported asking prices Robust demand for GCBs in 217 In line with the rising optimism, the Good Class Bungalow (GCB) segment saw volumes up 127% QOQ and 66% YOY to SGD279.8 (USD 212) million transacted in Q4. This brings total GCB transactions in 217 to SGD866.7 (USD657) million. In terms of number of bungalows, 12 bungalows were transacted in Q4, bringing the total number of GCBs transacted in 217 to 41, compared to 37 in 216. Industrial Industrial investment sector grew in 217 The total industrial investment sales value in Q4 fell 78.3% QOQ to SGD631.8 million (USD472.6, due to the absence of very large deals such as Q3's Jurong Aromatics Complex transaction. For the whole of 217, the industrial investment sales sector grew 37%YOY to SGD4.1 billion (USD3.1 billion). Industrial Investment Sales Value by Type Transaction Value (SGD 3,5 3, 2,5 2, 1,5 1, 5 Q4 216 Q1 217 Q2 217 Q3 217 Q4 217, JTC Wide varying bids for IGLS sites continued In Q4, transactions in the industrial public segment fell 28% QOQ and 92%% to SGD7.9 (USD5.9) million. Wide varying bids were submitted by s who are endusers for the 2-year tenure sites under the Industrial Government Land Sales (IGLS) tenders. For the whole of 217, public industrial land sales fell 77% to SGD37.4 (USD28.3) million. Bid Spread of Industrial Government Land Sale Sites in Q4 217 Land Parcel No. of s % premium over 2nd 1,6% 1,4% 1,2% 1,% 8% 6% 4% 2% % -2% % premium above last Tuas South Link 2 (Plot 1) % 49.% Tuas South Link 3 (Plot 25) % 258.7% Tuas South Link 3 (Plot 14) 3 2.8% 33.1%, JTC % QOQ Change 4 Colliers Quarterly Q4 217 Singapore Investment Colliers International

5 Private industrial investment sales value grew 44%YOY for 217 With the absence of very large deals, the total private industrial investment sales value dipped 78.5% QOQ to SGD623.9 million (USD in Q4. Despite the declines in industrial property rents through 217, the investment sales segment still grew 43.5% YOY to SGD4.1 billion in 217, mainly due to ExxonMobil's acquisition of Jurong Aromatics Complex in Q3 for SGD1.97 (USD1.5) billion, which is the largest deal in absolute terms in the industrial sector in the year. Citimac Complex, the only industrial collective sale in 217 transacted in Q3, was also one of the largest deals at SGD43.1 (USD326) million. REITs have been relatively more active in divesting than acquiring industrial assets in 217, while we see growing institutional interest in niche industrial assets. Major Industrial Transactions in Q4 217 Price (SGD Million) 7 Ang Mo Kio Avenue 5 (8% stake) 8 Tuas South Lane 1 Serangoon North Avenue 6 Price/sq ft (SGD) on on on Industrial Government Land Sales Tuas South Link on 2 (Plot 1) Tuas South Link on 3 (Plot 25) ESR-REIT ESR-REIT Iron Mountain Zhao Yang Geo- Systems Pte Ltd G.T.H. Engineering & Construction Pte Ltd Tuas South Link on Wee Hur 3 (Plot 14) Construction Pte Ltd Notes: Price on for 7 Ang Mo Kio Avenue 5 is based on 8% of valuation., JTC Given the stabilising outlook for the industrial property sector, we foresee a pick-up in interest in industrial properties by REITs and other qualified institutional investors. Shophouses 217's shophouse transactions achieved a new high since 213 Based on Colliers International's research, shophouse transactions with value of SGD5 million and above grew 3% QOQ to SGD183.2 (USD139) million in Q4. Total shophouse transactions in FY217 hit a new high of SGD795.1 (USD 62) million since 213's SGD855.9 (USD 648) million. With a positive outlook for residential and commercial property sectors, shophouses which are hybrids of these sectors and are scarce in supply, should remain an attractive asset class for boutique investors. Major Shophouse Transactions in Q4 217 Price (SGD Million) Price per sq ft (SGD) 56 Pagoda Street 23. 2,493 on NLA N.A. 167/ D Selegie Road 38 & 39 Craig Road on N.A ,834 on Entity affiliated to Clifton Partners, URA REALIS (as of 12 January 218) For more information: Colliers International Singapore Tang Wei Leng Managing Director weileng.tang@colliers.com Tricia Song Director and Head Research tricia.song@colliers.com Govinda Singh Executive Director Consulting, Valuation & Advisory Services govinda.singh@colliers.com 1 Raffles Place, #45- One Raffles Place Singapore Tel: Fax: RCB No. : R CEA Licence No: L34691J Copyright 218 Colliers International. The information contained herein has been obtained from sources deemed reliable. While every reasonable effort has been made to ensure its accuracy, we cannot guarantee it. No responsibility is assumed for any inaccuracies. Readers are encouraged to consult their professional advisors prior to acting on any of the material contained in this report. 5 Colliers Quarterly Q4 217 Singapore Investment Colliers International