CBRE RESEARCH2018 ASIA PACIFICREAL ESTATE MARKET OUTLOOK 15+ 2 3 4500+ T ABLE OF CONTENT04 ECONOMIC OUTLOOK07 OFFICE SECTOR12 LOGISTICS SECTOR17 CAPITAL MARKETS2018 CBRE, Inc.2018 ASIA PACIFIC REAL ESTATE MARKET OUTLOOK | [KOREA] 2CBRE RESEARCHECONOMIC OUTLOOKE CONOMI C OUTLOOKSTILL LOW FOR LONGERThe better-than-expected domestic economic performance in 2017, combined with the gradual global economic recovery, is expected to provide a solid base for steady economic growth in 2018.Moderate economic growth expectedFigure 1: Real GDP Growth 7% 6% 5% 4% 3% 2% 1% 0% 2010 2011 2012 2013 2014 2015 2016 2017 2018F GDP, Real GDP growth, y-o-y growth 1,200 1,100 KRW trillion 1,600 1,500 1,400 1,300Source: CBRE Research, January 2018. 2018 CBRE, Inc.2018 ASIA PACIFIC REAL ESTATE MARKET OUTLOOK | [KOREA] 5CBRE RESEARCHE CONOMI C OUTLOOKMODERATE ECONOMIC GROWTH EXPECTEDFurther interest rate hikes likelyWar for talent set to intensifyRisks and opportunities2018 CBRE, Inc.2018 ASIA PACIFIC REAL ESTATE MARKET OUTLOOK | [KOREA] 6CBRE RESEARCHOFFICE SECTOROFFI CE SECTORSTRONGER EMPHASIS ON DIFFERENTIATIONAs wellness and amenities take on more prominent role, it will be critical for landlords to differentiate their assets during what will be an increasingly competitive environment.2017 recap: Relatively stable demandGami ng i ndustry grow th, Fi nancial sector consolidation, and Co -w orking expansion2018 CBRE, Inc.2018 ASIA PACIFIC REAL ESTATE MARKET OUTLOOK | [KOREA] 8CBRE RESEARCHOFFI CE SECTORTECHNOLOGY FIRMS TO DRIVE LEASING DEMAND2018 Demand forecastGrowth in the industries related to the Fourth I ndustrial RevolutionI ncreased consolidation and fl i ght -toquality demandFigure 2: Transaction Breakdown (2017)Figure 3: Presence of co-working space provider in Seoul sqm 200,00019.5% 20.6%160,000 120,000 80,000 40,00071,400 (62%)44,10016.3% IT Service Construction Transportation Manufacturing Government Finance&Insurance Wholesale110,100 (111%)52,200 2016 Foreign 2017 Domestic-2018 CBRE, Inc.2018 ASIA PACIFIC REAL ESTATE MARKET OUTLOOK | [KOREA] 9CBRE RESEARCHOFFI CE SECTORSLIGHT INCREASE IN VACANCY DUE TO NEW SUPPLYFurther co-w orking sector expansi on; Local servi ce provi dersI ncreased pre -l easing demand2018 supply forecast; Increase in new stock expectedFigure 4: Net New Supply, Net Absorption, Vacancy Outlook Thousand, sqm650 500 350 200 50 -100 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018F14% 12% 10% 8% 6% 4% 2% 0%Net New Supply, GFA (LHS)Net Absorption, GFA (LHS)Vacancy Rate (RHS)2018 CBRE, Inc.2018 ASIA PACIFIC REAL ESTATE MARKET OUTLOOK | [KOREA] 10CBRE RESEARCHOFFI CE SECTORRENTAL GROWTH TO REMAIN FLAT2018 vacancy forecast; Slight increase due to new supplyWellness and amenities to take on more prominent role2018 rental forecast; Flat growth anticipatedFigure 5: Rental Trend Outlook KRW/sqm23,000 22,000 21,000 20,000 19,000 18,000 17,0004% 3% 2% 1% 0% -1% -2% -3%20122001200220032004200520062007200820092010201120132014201520162017Rental Growth (Y-o-Y) (RHS)Rents (LHS)2018 CBRE, Inc.2018 ASIA PACIFIC REAL ESTATE MARKET OUTLOOK | [KOREA] 11CBRE RESEARCH2018F。。。。。。