CBRE Asia Pacific Cost Guide 2018 - 2019

ASIA PACIFIC FIT- OUT COST GUIDE 2018/19 EDITION

FOREWORD CBRE Asia Pacific is delighted to present the 2018 Fit-Out Cost Guide, which covers 25 cities in Asia Pacific.

Now in its fifth year, the Asia Pacific Fit-Out Cost Guide 2018 aims to provide clients and real estate professionals with true cost data to help guide capital planning and decision-making. CBRE continually evolves the content to meet our clients’ needs and provide information to assist in development of corporate real estate strategies, as well as ‘benchmarking’ at a strategic level.

As an addition to our Asia Pacific paper, CBRE is also pleased to introduce the Fit-Out Cost Guide, Global Index providing a comparative CAPEX index guide for 23 key markets across the globe. This important index provides a comparative benchmark view of project costs with similar specifications.

I hope the Fit-Out Cost Guide offers useful insights and context. Please use this as a guide only, for specific projects please contact our CBRE Project Management team in your market.

MARTIN WOODS Senior Managing Director, Asia Pacific CBRE Project Management Global Leadership & Platform

GLOBAL WORKPLACE SOLUTIONS

1

CONTENTS

04

INTRODUCTION

30

2

ASIA PACIFIC FIT-OUT COST GUIDE

06

FACILITIES MANAGEMENT COSTS

GUIDE ASSUMPTIONS

36

NET PRESENT LIFECYCLE COSTING (NPLCC)

10

FIT-OUT COSTS

42

26

REGIONAL FIT-OUT COSTS ANALYSIS

LEASING COSTS

64

REGIONAL FIT-OUT PROJECT TIMELINE

Disclaimer: CBRE Ltd has taken every care in the preparation of this document. The sources of information used are believed to be accurate and reliable, but no guarantee of accuracy or completeness can be given. The cost estimation are intended to be guides only. Please contact our market leaders, provided within this document or available from our cbre.com website, who can provide accurate cost estimate based on your specific requirements. Please note: The CAPEX Index and the rates provided in cost per square foot only benchmark the common project costs including consultants fees, builders works, MEP works and furniture. The rates provided are a guide and a start point only for creating project budget estimates.

These rates are not to be used for creating specific project budgets.

Neither CBRE, nor any director, representative or employee of CBRE company, accepts liability for any direct or consequential loss arising from the use of this document. The information and opinions contained in this document are subject to change without notice. No part or parts of this document may be stored in a retrieval system or reproduced or transmitted in reprographics, recording or otherwise, now known or to be devised without prior consent from CBRE. GLOBAL WORKPLACE SOLUTIONS 3

INTRODUCTION

Fit-out Costs

Facilities Management Costs

REGIONAL BENCHMARKING

NET PRESENT LIFECYCLE COSTING

1. TRADITIONAL SOLUTION

3.COLLABORATIVE WORKPLACE

2. HOT DESKING

4. ACTIVITY BASED WORKPLACE

ACTIVITY BASED WORKING (ABW) FLIGHT TO VALUE: DECENTRALIZATION

4

ASIA PACIFIC FIT-OUT COST GUIDE

Our CBRE Project Management business focuses on partnering with clients to deliver projects from “concept to completion�, implementing cost efficiency, industry leading processes, minimising risk and creating real value. We are pleased to present the Asia Pacific Fit-Out Cost Guide 2018 providing marketleading insights helping our clients make informed decisions.

This year, CBRE continues to build on the in-depth review and relative analysis of previous editions on workplace strategy design options, net present life cycle costing and decentralisation to address the prevalent drivers for cost reduction. This data is a collation across project management, commercial leasing and facilities management to develop indices for each corporate real estate cost area.

With corporate real estate portfolios dispersed throughout Asia Pacific and the globe, clients will benefit from the APAC Index and the introduction of the Global Index which provides a broader, holistic view to benchmark project costs with similar specifications and design.

GLOBAL BENCHMARKING

CBRE encourages the use of the Fit-Out Cost Guide and Global Index as benchmarking indicators and to guide development of strategies for capital project planning. For specific project budgets please consult the CBRE Project Management Division Lead in market for budget estimates to assist with capital approval. CBRE can apply market knowledge and client understanding through information gathering to fulfil to your project management requirements.

We look forward to partnering with you in the future.

ZAC ZDRAVEV Executive Director, CBRE Project Management Global Leadership & Platform GLOBAL WORKPLACE SOLUTIONS

5

GUIDE ASSUMPTIONS Pricing in this document is based on the following assumptions:

FM Costs Additional Guide Assumptions:

The commercial tower is a Grade A office building within the Central Business District with the following characteristics:

Facility Management costs include: • Cleaning • Mechanical & Electrical Maintenance • Security Services • Utilities • Pest control • Mailroom • Reception • Landscaping • Confidential waste disposal

• A modern, flexible, column-free footprint of at least 15,000 sq ft • Total floor area of at least 300,000 sq ft • Sheltered parking GFA ratio of 1/2000 • Accessibility to public transport Commercial office assumptions: • Office size – 30,000 sq ft • Density range of 1 workstation to 110 to 150 sq ft • Office space is predominately open plan • Raised floor throughout the office space Fit-out costs include: • Consultants fees • Builders works • M&E works • Standard office FF&E • Physical IT infrastructure • Active network equipment • Physical security system • Audio Visuals Exclusions: • Dedicated chiller and generator installation • Acoustic Consultancy • Technology Consultant Fee • Consideration for building abnormalities or variances such as onerous landlord requirements

6

ASIA PACIFIC FIT-OUT COST GUIDE

Exclusions: • Dedicated Chiller and Generator maintenance • Property Tax • Management Fee

Net Present Lifecycle Costing (NPLCC) Guide Assumptions: • 5 year commercial office investment period • Grade A office building and defined as the gross lease cost • Medium Standard office fit-out construction rates • Medium Standard FM service • FM Cost adopts the CBRE Research y-o-y inflation rates • 10% discount rate applied for NPLCC Analysis

MACRO-ECONOMIC FACTORS Driving Dramatic Shifts Currency Volatility against USD

Inflation

5.4%

9.4%

3.8%

9.7%

1.9%

8.6%

-0.8%

0.2%

2.4% 2.0% 0.0%

1.2% 2.1% 1.3% 3.1%

Philippines Australia

6.7%

-2.7%

2017-2019 0.0%

2015-2017 2.0%

4.0%

1.6%

6.0%

10.0%

0.0%

2.5% 3.9% 3.7%

2017-2019 8.0%

4.1% 4.3%

2.1%

Indonesia

2.5%

5.2%

2.3% 3.0%

Vietnam

-2.0%

-2.0%

4.2%

New Zealand

3.5%

-1.1%

-4.0%

2.0% 1.5%

South Korea

Singapore

5.5%

-0.6% -0.9%

-6.0%

1.5% 1.0%

Taiwan

Hong Kong

-0.4%

-5.8%

1.2%

Malaysia

5.4%

-0.6%

0.2%

2.6%

India

3.6%

0.6%

1.5%

1.8%

Japan

6.3%

2.2%

0.7%

0.4%

China

5.1%

-0.3%

Thailand

2.0%

2015-2017 4.0%

6.0%

GLOBAL WORKPLACE SOLUTIONS

7

BY THE NUMBERS

192

The average cost in USD/sq.ft. to fit-out a commercial office in Tokyo.

Which is now the most expensive market in Asia Pacific.

218

The average cost in USD/sq.ft. to fit-out a commercial office in New York.

Which is now the most expensive location when CBRE has delivered projects.

207

The cost in USD/sq.ft. per annum for commercial office space in Hong Kong.

The most expensive market to lease Grade A office space in Asia Pacific.

10.44

The cost in USD/sq.ft. to manage office facilities in Sydney per annum.

32,324,472

The total investment in USD for a medium standard 30,000sq.ft. office in Hong Kong over a five year period.

8

ASIA PACIFIC FIT-OUT COST GUIDE

CBRE TOKYO

GLOBAL WORKPLACE SOLUTIONS

9

FIT-OUT COSTS

10

ASIA PACIFIC FIT-OUT COST GUIDE

CBRE SYDNEY

GLOBAL WORKPLACE SOLUTIONS

11

FIT-OUT SPECIFICATION – BASIC MANAGER ROOM AND PHONE BOOTH

BREAKOUT AREA

UNASSIGNED SEATING

Specification

12

ASIA PACIFIC FIT-OUT COST GUIDE

Basic

Basic

Basic

Medium

High

Density

Highier

Lower

Median

Lower

Lower

Work Type

Proccess

Knowledge

Knowledge

Knowledge

Knowledge

WORK AREA

RECEPTION

BOARD ROOM

TEAM COLLABORATION AREA

MEETING ROOM Source: Layout and rendering by Haworth

GLOBAL WORKPLACE SOLUTIONS

13

FIT-OUT SPECIFICATION – MEDIUM MANAGER ROOM AND PHONE BOOTHS

BREAKOUT AREA

UNASSIGNED SEATING

TOWN HALL

Specification Density Work Type

14

ASIA PACIFIC FIT-OUT COST GUIDE

Basic

Medium

High

Median

Lower

Lower

Knowledge

Knowledge

Knowledge

WORK AREA

RECEPTION

BOARD ROOM

TEAM COLLABORATION AREA

MEETING ROOM Source: Layout and rendering by Haworth

GLOBAL WORKPLACE SOLUTIONS

15

FIT-OUT SPECIFICATION – HIGH MANAGER ROOM AND PHONE BOOTHS

BREAKOUT AREA

UNASSIGNED SEATING

TOWN HALL

Specification Density Work Type

16

ASIA PACIFIC FIT-OUT COST GUIDE

Basic

Medium

High

Median

Lower

Lower

Knowledge

Knowledge

Knowledge

WORK AREA

RECEPTION

BOARD ROOM

TEAM COLLABORATION AREA

MEETING ROOM Source: Layout and rendering by Haworth

GLOBAL WORKPLACE SOLUTIONS

17

PROJECT STANDARD MATRIX PROJECT STANDARD Description of items

Basic

Medium

High

Process BPO Knowledge

Knowledge

Knowledge

N

N+1

2N

BASIC OFFICE FUNCTIONALITY

Work type Collaboration area Townhall M&E redundancy WALL & PARTITIONS

Plasterboard with fabric finish / to slab with high acoustic rating Double glazed partition Single glazed parition Plasterboard walls Operable wall Open ceiling FEATURE FLOOR FINISHES

Polished timbre Marble / stone slab finishes Carpet tile SYSTEM FURNITURE

Flexibily in workspace churn & expansion Powerhoop as an uninterrupted footprint division Resolved design & seemless connectivity Simplicity with reduced kits-of-parts Unified look and combined usage Cable through and various cable outlet application Height adjustability STORAGE

Lockers Mobile pedestal / Caddy

18

ASIA PACIFIC FIT-OUT COST GUIDE

PROJECT STANDARD Description of items

Basic

Medium

High

Access control doors

5

5

10

CCTV

3

3

6

3 months

3 months

6 months

100

200

200

PDU

2

2

4

Racks

1

1

2

100

200

200

SD – Below 3000 lumens

HD – Below 5500 lumens

UHD – Above 5500 lumens

TASK CHAIRS

Asymmetrical lumbar support system Pelvic support 4-D arms and seat pan adjustments Upright back lock Supportive mesh with tension zones Synchronized tilt mechanism Supportive mesh with optional upholstery back PHYSICAL SECURITY SYSTEM

System via IT network

Data storage PHYSICAL IT INFRASTRUCTURE

Eternet Cables – Cat 6A Data ports

Redundancy ACTIVE NETWORK EQUIPMENT

40Gbps backbone End points Redundancy AUDIO VISUAL

Display Intergrated ceiling mounted sound distribution system Video conference Lighting integration Room booking sytem integration Digital signal processor

CBRE PROJECT MANAGEMENT

19

APAC FIT-OUT COST INDEX In 2018, CBRE has compared the true cost of projects, including local market practices which have cost implications as well as expanding from four basic costs to seven cost categories. CBRE has also considered the work practice that would be suited to basic, medium and high standard layout designs. Each standard is defined by the level of design, workstation density and work type such as knowledge based work, process or business process outsourcing. In addition to specifications, the layouts demonstrate density and design changes, to allow clients to decide the appropriate work environment to achieve optimal productivity, and aligns with business strategy.

Whilst Grade A office space remains available in the market, sustained traditional tenant demand as well as growing demand from the start-up sector, coupled with numerous infrastructure projects has resulted in increased leasing activity within all commercial markets.

Consequently, we have seen inflationary pressure on rents which has resulted in many occupiers postponing major fit-out projects or reducing their overall CAPEX spend per project.

STEWART MATHEWS Senior Director, Sydney CBRE Project Management

20

ASIA PACIFIC FIT-OUT COST GUIDE

der ab ad

8

1.21

Syd ney

pur um

1.30

0.58

0.5

Hy

Seoul

ok

la L Kua

Bangk

Tokyo

The index is generated from empirical project data gathered across multiple industries through the use of CBRE’s Project Management platform. The index aims to help clients understand the capital cost differences across the region and to provide reference for cost benchmarking.

1.2

1.60

1

1.40

1 0.6

H

6

1.1

1.20

ong

K ong

1.00 ila

0.64

0.80

1.16

Man

0.60

Perth

0.40

1.01

0

0.7

Sha

7

ta

ar Jak

1.0 0

0.68

i

Mumba

1.01

0.20

0.65

Bangalore

0.8

ngh

ai

7

Brisbane

Guangzhou

Taip ei

0.95

e ourn Melb

0.93

0.96

re

0.84

po ga

Sin

MC

Beijing

0.9

1

HC

Auckland

Disclaimer: This graph shows the capital expense multiplier for the design and construction of the same office project across Asia Pacific using Shanghai as the unit index. This cost index should be used as a guide only, for actual project budget estimates please contact the CBRE Project Management Division Lead in your city.

GLOBAL WORKPLACE SOLUTIONS

21

FIT-OUT COST BENCHMARKING TABLE Region North Asia

South Asia

HIGH

City

US$/sq.ft

US$/sq.ft

US$/sq.ft

Reinstatement US$/sq.ft

South Korea

Seoul

118

170

249

21

Japan

Tokyo

115

175

285

49

Beijing

95

137

213

13

Shanghai

93

134

216

12

Guangzhou

92

133

194

11

Taiwan

Taipei

84

117

172

11

Hong Kong

Hong Kong

103

156

255

36

Sydney

115

168

252

17

Melbourne

92

133

200

14

Perth

108

165

239

14

Brisbane

89

130

193

14

New Zealand

Auckland

83

143

220

15

Philippines

Manila

66

85

131

9

Vietnam

HCMC

82

116

163

3

Indonesia

Jakarta

74

107

160

5

Malaysia

Kuala Lumpur

63

77

119

5

Singapore

Singapore

100

124

205

11

Thailand

Bangkok

54

73

130

10

Mumbai

64

95

142

3

Hyderabad/Kolkata/Pune

58

83

128

3

Bangalore/Chennai/Delhi

60

89

138

3

Greater China

South East Asia

MEDIUM

Country

China

Pacific

BASIC

Australia

India

CBRE has analysed empirical data from completed projects across multiple industries for each market. The fit-out cost table provides the cost of projects in three high level categories. The figures provided include seven common areas of Consultancy Fees, Builder Works, M&E Works, Fixed Furniture and Equipment, IT, AV, and Security.

This table only serves as a guide. For budget estimates, please contact CBRE Project Management Division Leads in the specific market. The typical reinstatement rates for offices have been included, however note that rates may vary due to landlord requirements, reinstatement agreements and project brief just to name a few variables.

22

ASIA PACIFIC FIT-OUT COST GUIDE

CBRE TOKYO

The technology industry in APAC is generally very busy as the major cities in the region continue to grow leading to a shortage of good quality installation engineers which in turn is driving up salary expectations and therefore, installation costs. Equipment and material supply costs are generally increasing in line with the underlying inflation in any given location with logistics costs seeing a small increase.

ANDREW GREEN Group Director PTS Consulting GLOBAL WORKPLACE SOLUTIONS

23

GLOBAL FIT-OUT COST INDEX The global economy began 2018 in its best shape since the Global Financial Crisis ended in 2009. All the major economic regions are growing at or above trend, and economic policy – both fiscal and monetary remains expansionary.

Growing confidence has had the effect of continued growth in the office leasing sector, which has seen a rise in demand for different space usage across all regions, such as the corporate real estate sector experimenting with the inclusion of co-working space as an example, as well as searching for alternatives to the traditional acquisition, design, construction and operation of office space. The co-working office landscape has yet to be tested over a full economic/real estate cycle, however, the increase in demand combined with occupiers focus on deploying technology and wellness has seen the introduction of new corporate strategies, including increased flexibility and speed-to-market for real estate projects.

This burgeoning sector and other market disruptors such as decentralisation create a dynamic construction landscape.

From large corporations to start-ups, benchmarking remains a key tool to assist our clients in their decision-making process. CBRE is pleased to introduce the inaugural CBRE Global Fit-Out Index which aims to highlight the relativity of key markets around the world. Specifically, this index shows the effect on corporate real estate capital planning decisions by reporting the comparative difference of office fit-out costs in 23 key markets across four global regions.

This industry leading benchmark data paired with CBRE’s global presence and market knowledge allows us to partner with our clients to provide our expertise, and offer the best solutions to achieve our clients’ objectives.

The Global Index is a guide only. For budget estimates on specific projects, please contact the CBRE Project Management Division Lead from the relevant market who can provide you with relevant and accurate information.

ZAC ZDRAVEV Executive Director, CBRE Project Management Global Leadership & Platform

24

ASIA PACIFIC FIT-OUT COST GUIDE

ai

San Fr ancisco

ur t

ris Pa

0.6 8

1.40 1.20 1.00

0.86

ity

1.30

0.80

Tokyo

0.86

0.60

1.27

Dallas

8

0

ico C

1.4

1.60

1.4

Mex

1.48

Fr a nkf

6

0.6

mb

New York

Bogotรก

o tiag San

Mu

1.48

0.65

0.40

Seattle

0.20

1.23

0.91 0.97

1.21

Buenos Aires

0

Londo

n

1.2

9 0.9

1

pore

Singa

Chicago

nta Atla

1.0

8

Dublin

ghai

lo Pau

Shan

rg

sbu

ne

an

ng

1.16

1.16 g Ko Hon

1.02

Madrid

1.00

Joh

1.1

0

Sรฃo

Syd ney

Disclaimer: This graph shows the capital expense multiplier for the design and construction of the same office project globally using Shanghai as the unit index. This cost index should be used as a guide only, for actual project budget estimates please contact the CBRE Project Management Division Lead in your city.

GLOBAL WORKPLACE SOLUTIONS

25

LEASING COSTS

26

ASIA PACIFIC FIT-OUT COST GUIDE

CBRE HYDERABAD

GLOBAL WORKPLACE SOLUTIONS

27

LEASING COST

Gross leasing volume in the Grade A office market was 40% higher in 2017 than that in 2016, totaled 4.6 million sq ft (NFA). Leasing momentum remains upbeat in H1 2018, with another 4.2 million sqft being recorded during the period.

STEVE PALFREY Executive Director, Hong Kong CBRE Project Management

Leasing markets have been highly active with a proactive commitment to high quality supply. There has also been an increasing trend for occupiers - both domestic and multinationals - executing creative strategies within co-working spaces focused towards a more flexible workplace environment and minimizing capex impacts.

The table provides the leasing costs in US$ per sq. ft. per annum in Net Floor Area basis for Grade A office building in CBD of each market unless stated otherwise. The figures are presented on an effective basis which excludes landlord benefits offers and rent free periods.

Inclusion of service charges varied by markets depending on local practice.

CITIES

Hong Kong – Central

207

Tokyo

101

Beijing

92

Singapore

89

Shanghai

85

Delhi

63

Mumbai – BKC

58

Hong Kong – Kowloon East

52

Sydney

51

Guangzhou

47

Taipei

46

HCMC

45

Seoul

44

Bangkok

34

Bangalore

31

Melbourne

29

Gurgaon

25

Auckland

25

Brisbane

25

Perth

21

Kuala Lumpur

21

Hyderabad

9.5

Source: CBRE Asia Pacific Research , Q2 2018

ROHINI SALUJA Executive Director, Asia Pacific CBRE Advisory & Transaction Services

28

ASIA PACIFIC FIT-OUT COST GUIDE

GRADE A

Bei

jing

Tokyo

1.18

1.0

8

re

po ga

2.10

Sin

1.0

1.80

4

Gurg

2.43 2.40

4

pu r

3

0.2

Lum

0.2

ala

Hong Kong – Central

abad Hyder

th Per

Ku

0.11

1.50

0.29

aon

1.00

1.20

hai

Shang

0.90

0.29

0.60

0.75

Auckland

0.30

Delhi

0.35

Hong Kow Kong – loon East

e

0.6 0

6 0.3

Syd ney

e

lor ga

n

0.4

5

HCMC

ou

Seoul

0.54 i Taipe

0.53

gzh

0.51

0.5

n Gua

k

0

gko

Ba

Ban

ourn Melb

Mumbai – BKC

0.61

0.30

Brisbane

0.68

0

GLOBAL WORKPLACE SOLUTIONS

29

FACILITIES MANAGEMENT COSTS

30

ASIA PACIFIC FIT-OUT COST GUIDE

CBRE TOKYO

GLOBAL WORKPLACE SOLUTIONS

31

FACILITIES MANAGEMENT COSTS The operating cost of a corporate office within this document is defined as the Facilities Management (FM) cost. The FM cost shall be classified into nine key and most common components namely, cleaning, M&E maintenance, pest control, security services, utilities, mailroom, confidential waste, landscaping and reception. Depending on the facility, the cost may differ on the final service standard adopted by the client.

Key Components

CLEANING

SECURITY SERVICES

PEST CONTROL

LANDSCAPING

MAILROOM

Labour inflation and currency volatility continue to drive cost changes across APAC. Skills gaps in certain markets have also driven salaries in the service delivery space. CBRE has mitigated these cost pressures by improving operating efficiencies through its Asset Performance programme. The benefits of energy and sustainability strategies have resulted in utilities costs remaining steady and even reducing. Enhancing the workplace experience is changing services and the interaction with end users is driving how technology is being used.

32

ASIA PACIFIC FIT-OUT COST GUIDE

RECEPTION

CONFIDENTIAL WASTE

MECHANICAL & ELECTRICAL MAINTENANCE

MICHAEL HARRINGTON Senior Managing Director, Asia Pacific CBRE Enterprise Facilities Management

UTILITIES

e

gap ore Sin

2 ul

0.5

7

1.20

Seo

1.0

1.00

7

0.80

1.04

0.60

0.58

Manila

1.1

1.40

gko

k

1.26

1.60

7 0.5

Ban

1.35

Perth

abad Hyder

r alo ng Ba

0.52

Sydney

FACILITIES MANAGEMENT COST INDEX

Beijing

0.40 0.20

1.01

0.62

0

0.67

1.00

Mumbai

0.7

1.0 0

ne Brisba

Shang

hai

Auc

6

arta Jak

Tokyo

9

0.7

0.9 urne

Guangzhou

i

um pur

Melbo

g

0.95 Taipe

0.90

Kon

0.83

ng Ho

9

Kua la L

kla nd

Disclaimer: This graph shows the FM Cost index across Asia Pacific using Shanghai as the unit index. This cost index should be used as a guide only, for actual project budget estimates please contact the CBRE EFM Division Lead in your city.

GLOBAL WORKPLACE SOLUTIONS

33

FACILITIES MANAGEMENT COSTS Shown below are the unit rates per sq. ft. in USD for various components annually. Rates in different locations are directly affected by the labour market condition and local tariff rates.

RECEPTION

MAILROOM

$0

$2

$3

LANDSCAPING

$4

$5

$6

$7

$8

Perth

1.34

Singapore

1.53

Seoul

1.24

0.91

Beijing

1.25

0.90

Tokyo

1.80

Shanghai

1.20

Auckland

1.36

Hong Kong

1.33

0.38

1.30

1.44

1.59

1.41

Taipei

1.31

0.38

1.26

1.41

1.95

0.85

Guangzhou

1.08

0.78

0.90

Melbourne

1.13

0.73

1.04

0.67 0.32 0.89

0.99

Jakarta

0.44

0.91

1.62

1.68

0.86

1.53 1.15

1.00 1.24

0.88

0.89

Brisbane

0.91 0.59

Mumbai

0.87 0.60 0.72

0.83

1.15 1.97

0.92 0.80

1.14 0.85

0.97

Bangkok

0.80 0.39 0.85

0.94 0.50 0.84

4.80

0.67 0.72 4.45

0.78

4.43

0.78 4.39

0.73 0.50 0.60 0.67 0.71 0.72

ASIA PACIFIC FIT-OUT COST GUIDE

0.63 5.16

0.85

0.71 0.40 0.87

Hyderabad

0.80

4.02

6.11 5.89

7.82 7.71 7.63

7.34

6.95

0.79 6.43 1.10

1.44

0.94

1.25

1.42

8.06 7.72

1.39

1.72

1.03

0.80

1.71

1.38

0.99

0.79 0.55 0.66 0.73

1.63

8.69

0.90 8.25 1.45

1.92

Manila

Bangalore

2.00

1.20

1.38

0.49

1.06

1.50

1.87

1.05

1.57

1.92

1.56

$10 1.69

2.25

1.80

1.40

0.99

1.14

1.93

1.74

$9

2.41

1.44

0.97

UTILITIES

M&E

CONFIDENTIAL WASTE

Sydney

Kuala Lumpur

34

$1

PESTS CONTROL

SECURITY

CLEANING

9.72

$11

10.44

CBRE TOKYO

GLOBAL WORKPLACE SOLUTIONS

35

NET PRESENT LIFECYCLE COSTING (NPLCC)

Net Present Lifecycle Costing is a quantitative estimate of the total cost of a commercial office investment in present value.

The expenses included are capital or office fit-out costs, leasing costs, facilities management costs and reinstatement costs.

Guide Assumptions: • 5 year commercial office investment period • Grade A office building and defined as the gross lease cost • Medium Standard office fit-out construction rates • Medium Standard FM service • FM Cost adopts the CBRE Research y-o-y inflation rates • 10% Discount Rate applied for NPLCC analysis

36

ASIA PACIFIC FIT-OUT COST GUIDE

CBRE SYDNEY

GLOBAL WORKPLACE SOLUTIONS

37

NET PRESENT LIFECYCLE COSTING The below table presents the NPLCC for each market over a period of five year investment and applying the USD/sq ft cost to a medium standard 30,000 sq ft office.

FIT-OUT COST Hong Kong

$156

Tokyo

$175

Beijing

LEASING COST

FM COST

REINSTATEMENT

$863

NPLCC (USD/sq ft)

NPLCC (USD-30,000 sq ft)

$1,077

$ 32,324,472

$420

$662

$ 19,853,129

$137

$384

$565

$ 16,936,633

Shanghai

$134

$355

$531

$ 15,922,231

Singapore

$108

$371

$524

$ 15,709,901

Sydney

$138

$214

$409

$ 12,280,999

Seoul

$170

$182

$402

$ 12,062,997

Guangzhou

$133

$195

$366

$ 10,966,603

$95

$240

$359

$ 10,761,553

Delhi

$68

$264

$355

$ 10,636,683

Taipei

$117

$190

$346

$ 10,378,602

Perth

$137

$82

$271

$ 8,132,703

Melbourne

$105

$123

$266

$ 7,978,256

Auckland

$115

$104

$263

$ 7,882,736

Bangkok

$87

$141

$254

$ 7,625,025

Brisbane

$102

$106

$240

$ 7,200,685

Bangalore

$89

$127

$220

$ 6,613,780

Kuala Lumpur $94

$87

$211

$ 6,325,510

$196

$ 5,867,119

$143

$ 4,285,017

Mumbai

Gurgoan Hyderabad $0

38

$89

$102

$83 $40 $100

$200

$300

ASIA PACIFIC FIT-OUT COST GUIDE

$400

$500

$600

$700

$800

$900

$1,000

$1,100

The graph below illustrates a yearly cash-flow outlay considering a typical five year lease period for a medium standard 30,000 sq ft office fit-out in Hong Kong brought forward to present value.

FIT-OUT COST

Year 1 $400

LEASING COST

Year 2

FM COST

Year 3

REINSTATEMENT

Year 4

Year 5

$8 $36

$300 $207

$8

$8

$8

$207

$207

$207

$215

$215

$8

$200 $100

$156

$207

$0 Total Annual Cost

NPLCC

$371

$1,077 per sq ft

$215

$251

$32,324,472 for 30,000 sq ft

All costs are expensed in the year in which the activities are billed. Most office fit-out projects can be completed within a 12 month period so for the purpose of this exercise all capital expenses are accounted for in Year 1.

For the purpose of this exercise no “rent free” period has been assumed. Many markets commence lease payment from the point of possession and this has been adopted for direct comparison.

GLOBAL WORKPLACE SOLUTIONS

39

CBRE TOKYO

40

ASIA PACIFIC FIT-OUT COST GUIDE

Kua la L

2.40

pur

jin g

1.0

6

2.10

um

ai

0.4 0

1.80

0 1.0

1.50

ngh Sha

1.20

0.99

0.90

0.42

Banga lore

1.25

Bei

7 0.3

2.03

Tokyo

abad Hyder

on rga Gu

0.27

Hong Kong

NET PRESENT LIFECYCLE COSTING INDEX

0.60

0.45

0.77

0.30 0

0.48

0.76

Brisbane

A

0.6

0 0.5

d lan uck

Sydney

Seoul

9

ok

Bangk

ore Singap

8

0.5

0.6

Taipei

Perth

e Me lbo urn

ai

0.67 Delhi

0.65

hou

mb

0.51

ang z

Mu

0

Gu

Corporate real estate decisions should be made with holistic office investment information benchmarked regionally. This provides the opportunity to create accurate capital plans as well as help decide where projects can be activated based on current macro economic factors.

CBRE, through extensive data analysis from each GWS business line, is able to provide our clients a concise index and representation of the major cost considerations for their commercial office investment. The NPLCC can help develop real estate strategies that support corporate objectives.

Disclaimer: This graph shows the NPLCC index across Asia Pacific using Shanghai as the unit index. This cost index should be used as a guide only, for actual project budget estimates please contact the CBRE Project Management Division Lead in your city.

GLOBAL WORKPLACE SOLUTIONS

41

REGIONAL FIT-OUT COST ANALYSIS

42

ASIA PACIFIC FIT-OUT COST GUIDE

GLOBAL WORKPLACE SOLUTIONS

43

JAPAN COST ANALYSIS – TOKYO TOKYO Construction costs continue to increase in 2018 as the construction market booms due to factors including earthquake and natural disaster restoration work, the Tokyo Olympics buildup, and burgeoning Class A office building construction. The construction industry's labor force demand continues to exceed supply as average worker age increases, inducing higher labor costs. Japan's contractors are all working at full capacity, causing overhead costs to rise, as profit margins continue to reach record levels.

HISANAO KAJIURA Senior Director Tokyo Project Management +81 3 52889749 hisanao.kajiura@cbre.co.jp

USD285 1.0%

Security

AV

17.9%

Soft Cost

IT

9.2%

USD175

5.8%

0.7%

11.8%

USD115

7.5% 8.0%

0.8% 10.4% 8.2% 10.5%

26.4%

25.9%

28.0%

27.4%

31.2% 29.8% 12.9% Basic

44

ASIA PACIFIC FIT-OUT COST GUIDE

14.4% Medium

12.2% High

Builder Works M&E Works Furniture

SOUTH KOREA COST ANALYSIS – SEOUL SEOUL In 2018, the team observed several key relocations by local conglomerates moving into major Grade A office. Co-working operators extending their focus from GBD to CBD. GBD continued to see solid leasing demand from the technology and manufacturing sectors. In the YDB, the forthcoming redevelopment of the Private Teacher’s Pension building is creating a considerable volume of relocation demand.

BRUCE LEE Senior Director South Korea Project Management +822 21705870 bruce.lee@cbrekorea.com

With regards to construction related cost, contradictory to inflation reports, there has been little to no change in costs over the last 12 months. Competition has kept cost of supply and hardware stagnant with labour cost the main driver for higher costs.

USD249 1.4% 14.3%

USD170 0.9%

USD118 1.0% 6.2% 9.9%

8.9%

Security

AV Soft Cost

IT Builder Works

13.1%

M&E Works Furniture

5.7%

9.7% 9.7%

28.5%

12.4% 36.2% 22.8%

37.4% 18.5% 20.7% 12.4% Basic

16.1% Medium

14.2% High

GLOBAL WORKPLACE SOLUTIONS

45

TAIWAN COST ANALYSIS – TAIPEI TAIPEI Total office net absorption in Taipei surged in 2018, driven by strong demand for medium and large office units in both Grade A and Grade B offices. Leasing activity was led by professional services firms and local start-ups. Several multinational companies relocated for flight to quality purposes, while selected local start-ups committed to large quality office spaces in CBD areas as a means to attract talent.

JAMES HO Senior Director Taiwan Project Management +886 2 77069538 james.ho@cbre.com

Leasing demand for Grade A offices is expected to remain robust, driven by consolidation and expansion by technology and professional services companies. On the other hand, Grade B office vacancy is forecast to increase modestly over the next two quarters as a result of several large corporates moving to newly built Grade A office buildings.

USD172 1.4%

USD117 USD84 0.9% 7.9% 10.5% 7.3%

0.9% 11.3% 10.4% 6.2%

46

ASIA PACIFIC FIT-OUT COST GUIDE

13.9% 4.9%

22.5%

Security

AV Soft Cost

IT Builder Works

30.4%

M&E Works Furniture

34.0%

34.7% 23.4%

15.4%

20.8%

15.3%

14.7%

13.2%

Basic

Medium

High

HONG KONG COST ANALYSIS HONG KONG

STEVE PALFREY Executive Director Hong Kong Project Management +852 282 02996 steve.palfrey@cbre.com.hk

Decentralisation has been a key HK trend in recent years, with MNCs seeking cost effective options outside of the CBD. With Corporates relocating 560,000 sq ft of space away from the core office submarkets in 2017, we have seen a steady increase in the volumes of medium grade office fit outs and Agile working spaces being adopted more commonly, if not the norm. The development of new higher-specification buildings in Kowloon East and Hong Kong East has given traditional Corporate occupiers the greater diversity for positive building stock options in these locations.

HK has seen a sharp increase in Co-working centers that is driving demand for space in the Hong Kong office market. This sector has leased a total of 340,000 sqft of space in H1 2018, bringing the year-to-date stock to 1.4 million sqft. CBRE Research expects Hong Kong’s co-working stock to reach 1.6 million sqft by year end 2018. As the number of start-ups grows and corporate occupiers increasingly embrace agile working, demand for co-working space is expected to climb, putting further pressure on the supply chain of HK that will result in an upturn in 2019 delivery costs.

USD255 0.9%

USD156

USD103 0.7% 6.1% 8.2% 11.0%

0.6% 8.1% 7.4% 8.4%

Security

9.9%

AV

8.9%

Soft Cost

6.4%

IT Builder Works M&E Works

28.1%

Furniture

27.7% 28.9%

28.9% 31.9% 32.4% 12.7%

15.9%

Basic

Medium

16.9% High

GLOBAL WORKPLACE SOLUTIONS

47

CHINA COST ANALYSIS – BEIJING/GUANGZHOU BEIJING Increase in both labour cost and material procurement, mainly caused by more stringent policy from local government on labour control and air pollution treatment in Bejing and Northern China. High volume of IT and AV investment in high-profile projects is also in line with market trend of network-driven office operation.

USD213

CATHERINE XIONG Executive Director China Project Management +86 10 85880788 catherine.xiong@cbre.com.cn

1.2%

USD137 USD95 0.9% 7.9% 10.5% 14.5% 22.6% 27.5%

0.9% 10.9% 10.0% 10.2%

14.0% 12.6% 7.2% 22.4%

AV Soft Cost

IT Builder Works M&E Works

22.7% 28.9%

Security

28.9%

16.1%

16.4%

13.7%

Basic

Medium

High

Furniture

GUANGZHOU

USD194 USD133 USD92 1.0% 8.2% 10.9% 14.4%

0.9% 11.2% 10.3% 8.5% 25.6%

1.4% 15.4% 13.9% 6.9% 23.6%

28.8%

25.5%

16.1% 10.4%

14.7%

13.2%

Basic

Medium

High

28.7%

ASIA PACIFIC FIT-OUT COST GUIDE

AV Soft Cost

IT Builder Works M&E Works Furniture

26.4%

48

Security

CHINA COST ANALYSIS – SHANGHAI SHANGHAI Companies in finance, TMT and co-working sectors contributed to most market transactions. The new supplies in the coming quarters are increasing. More firms considering to relocate from CBD to decentralized area. Clients are also implementing workplace strategy from cost saving and space efficiency perspective.

USD216 1.2% 13.8%

Security

AV Soft Cost

IT

12.5%

USD134

Builder Works M&E Works

7.2%

Furniture

0.9% 11.2%

USD93

10.2%

1.0% 8.1% 10.8%

10.9%

13.6%

21.0%

21.8% 29.8%

22.5% 29.4% 28.0% 16.0%

15.6%

14.5%

Basic

Medium

High GLOBAL WORKPLACE SOLUTIONS

49

INDIA COST ANALYSIS – MUMBAI MUMBAI Supply addition was witnessed in western suburbs, Kurla and Santacruz. Primary leasing continued to dominate space take up, owing to ample availability of space in recently completed investmentgrade developments. The momentum gained by co-working spaces in 2017 is likely to continue this year as well as large corporates look at consolidating businesses to maximise their productivity.

GURJOT BHATIA Managing Director India Project Management +91 1142490200 gurjot.bhatia@cbre.com

USD142 1.9% Security

AV

21.0%

M&E Works

19.0%

15.8%

USD64

6.4% 14.5%

1.4% 11.8% 15.7%

8.9%

17.4%

19.9%

10.0% 19.9%

25.6% 30.1%

29.8%

50

ASIA PACIFIC FIT-OUT COST GUIDE

IT Builder Works

USD95 1.2%

Soft Cost

11.4%

9.6%

8.7%

Basic

Medium

High

Furniture

INDIA COST ANALYSIS – HYDERABAD / KOLKATA / PUNE HYDERABAD/ KOLKATA/ PUNE The city witnessed supply addition in the form Office market has maintained a steady growth over the past two years, dispelling apprehensions about the adverse impacts of bifurcation on commercial activity. In 2017 alone, the city witnessed the absorption of about seven million sq ft of office space. The 2018 began on a positive note with IT corridor leading the demand for office.

USD128 2.0% Security

AV

23.2%

Soft Cost

IT Builder Works

USD83 1.4%

USD58

18.1%

1.5%

16.5%

12.9% 17.3% 13.6%

12.2%

20.9%

Furniture

9.7%

15.1%

17.9%

19.1% 27.4%

M&E Works

22.1% 25.6%

8.2%

8.3%

7.0%

Basic

Medium

High

GLOBAL WORKPLACE SOLUTIONS

51

INDIA COST ANALYSIS – NEW DELHI / BANGALORE / CHENNAI NEW DELHI/ BANGALORE/ CHENNAI IT hubs remained the most active office markets, despite deferment of supply, subdued business sentiments and recent layoffs by technology companies.

The momentum gained by co-working spaces in 2017 is likely to continue this year as well as large corporates look at consolidating businesses to maximise their productivity.

GURJOT BHATIA

(10) New Delhi/Bangalore/Chennai

Managing Director India Project Management +91 1142490200 gurjot.bhatia@cbre.com

USD138 1.9% Security

AV

21.7%

Soft Cost

IT Builder Works

USD89 1.3%

USD60

16.9%

1.5%

15.4%

12.6%

9.3%

19.5%

6.8% 17.1%

16.8% 11.8%

19.3%

19.4% 28.9%

52

ASIA PACIFIC FIT-OUT COST GUIDE

25.0% 28.5%

9.0%

9.3%

8.0%

Basic

Medium

High

M&E Works Furniture

SOUTH-EAST ASIA COST ANALYSIS – SINGAPORE SINGAPORE

GARTH CHAPMAN Executive Director SEA Project Management +65 62291114 garth.chapman@cbre.com.sg

The fit-out market remains active, with the technology sector continuing to lead the growth and the banking and finance sector generally focusing on spatial efficiencies through consolidation.

As clients look for opportunities to reduce cost and offload risk, there remains an appetite for exploring co-working solutions, whose operators have cemented a share in the market with one or two notably demonstrating market dominance in this highly competitive arena. Whilst growth has moderated throughout 2018, with Singapore’s focus on digitisation and transformation of key industries, this should help pave the way for a more sustainable growth in the longer term.

USD205 1.0% Security

18.6%

AV Soft Cost

IT Builder Works

10.1%

USD124

4.2%

M&E Works Furniture

0.7%

USD100 0.7% 5.5% 7.7% 8.6%

11.7% 8.5% 5.5%

25.3%

26.1% 29.3%

26.7% 31.7%

34.4%

13.8%

15.8%

Basic

Medium

14.1% High

GLOBAL WORKPLACE SOLUTIONS

53

SOUTH-EAST ASIA COST ANALYSIS – KUALA LUMPUR KUALA LUMPUR An increased number of informed client representatives has seen improved appreciation of compliant and good quality office solutions. This has long been a cornerstone the project management team's advice to our clients and there is now a marked increase in the number of good quality fit-out designer and contractor options available to our clients.

GARTH CHAPMAN Executive Director SEA Project Management +65 62291114 garth.chapman@cbre.com.sg

USD119 1.8% Security

AV

20.4%

Soft Cost

IT

USD77 USD63

1.2% 15.8%

1.2 9.7%

6.2%

8.4%

14.4%

Builder Works

4.2% 18.3%

19.0%

12.9% 24.4%

21.3% 22.6%

30.4%

54

ASIA PACIFIC FIT-OUT COST GUIDE

26.0%

13.0%

15.1%

13.7%

Basic

Medium

High

M&E Works Furniture

SOUTH-EAST ASIA COST ANALYSIS – VIETNAM HCMC / HANOI There was no new supply on the office markets in HCMC in first half of 2018. Amid stability in supply, average asking rents, as well as occupancy rates improved. Net absorption for the past year showed rapid absorption. It is expected that Grade A will maintain its increasing path, though at a slower rate, for rental rates because of limited available supply. Grade B is expected to have a more stabilized and healthy performance because of its small but more constant supply. Looking forward to the rest of 2018, the office market continues to be landlord-driven.

USD163 1.5% Security

14.1%

USD116

USD82

10.1%

1.0%

6.3%

Soft Cost

IT

14.4%

Builder Works M&E Works

0.9% 10.1%

AV

4.9%

Furniture

18.9%

7.2% 10.4%

21.3%

8.1% 24.5% 24.4% 29.2% 31.0% 22.1%

21.7%

17.9% Basic

Medium

High

GLOBAL WORKPLACE SOLUTIONS

55

SOUTH-EAST ASIA COST ANALYSIS – BANGKOK BANGKOK

GARTH CHAPMAN Executive Director SEA Project Management +65 62291114 garth.chapman@cbre.com.sg

Net take up in 2018 is forecasted by to be at the same level as last year as there is no expected a sudden jump in demand while tenants are using space more efficiently and some are choosing co-working space which means in general, companies will require less space per person when they expand. Future supply continues to be limited from now until 2021 forcing tenants to consider renovation of existing premises and space optimization projects. Based on developer’ announcements new office completions could reach over 500,000 sq.m. per year between 2022 and 2023. Some developers are anticipating that tenants will move from Grade B buildings to Grade A buildings and that the future vacancy will be in Grade B buildings.

USD130 2.0% Security

AV

21.7%

Soft Cost

IT Builder Works

USD73

M&E Works

20.0%

1.6%

USD54

3.4% 19.3%

1.7% 13.1%

18.1%

17.9%

4.9%

8.1%

22.0%

23.6% 25.5%

56

ASIA PACIFIC FIT-OUT COST GUIDE

22.0%

21.9% 23.7%

10.1%

10.4%

Basic

Medium

9.0% High

Furniture

SOUTH-EAST ASIA COST ANALYSIS – JAKARTA JAKARTA The completion of Phase I of the Jakarta Mass Rapid Transit in 2019 is expected to begin to alleviate the city’s traffic gridlock and provide other benefits such as less time wasted in traffic and reduced fuel consumption. The real estate sector, particularly those areas along the new MRT lines and in close proximity to stations, is also expected to be a major beneficiary, with land prices already having risen significantly since construction of the MRT line began.

In terms of real estate trends, Jakarta is no stranger to the co-working space. The number of coworking providers has expanded rapidly in recent years and co-working spaces in Jakarta are still largely occupied by start-ups seeking cost effective and collaborative offices.

USD160 1.3% 15.0%

Security

AV Soft Cost

IT

USD107

12.6%

0.9%

5.7%

Builder Works M&E Works Furniture

11.2%

USD74 1.0% 8.2% 10.2%

9.6%

23.4%

7.8% 25.1%

9.7% 25.7%

25.8% 29.0% 30.6% 14.5% 10.1% Basic

16.4% Medium

16.3%

High GLOBAL WORKPLACE SOLUTIONS

57

SOUTH-EAST ASIA COST ANALYSIS – MANILA MANILA

GARTH CHAPMAN Executive Director SEA Project Management +65 62291114 garth.chapman@cbre.com.sg

Metro Manila Office take-up is expected to increase over 2018 by approximately 20% from 2017.

The BPO industry is anticipated to maintain its growth whilst Offshore Online Gaming is bolstering 2018 growth. Despite the volatile political environment, foreign investments are still showing steady growth and investment. There are numerous infrastructure development programmes ongoing under the current administration’s ‘Build, build, build program’, the new developments in the provinces being designed to decongest Manila. The many initiatives and investments are collectively driving significant market activity, which is adding significant pressure to the overall supply chain beyond normal expectations, requiring very close management.

USD131 1.9% 20.3%

1.3% 10.2% 14.1% 8.9%

1.3% 15.6% 14.9% 5.5%

IT

19.0% 3.5% 23.0%

24.6%

26.1% 28.2%

58

ASIA PACIFIC FIT-OUT COST GUIDE

26.5%

AV Soft Cost

USD85 USD66

Security

22.9%

11.2%

11.6%

9.4%

Basic

Medium

High

Builder Works M&E Works Furniture

PACIFIC COST ANALYSIS – SYDNEY SYDNEY Weaker business conditions and subdued leasing activity over the first half of this year suggest a lower growth profile over the near term. Vacancy is still forecast to reach historic lows by 2018. The key difference between the current environment and past recoveries is that declining vacancy will be driven by stock withdrawals as opposed to expansionary demands.

IAN REA Managing Director Pacific Project Management +61 2 9333 9102 ian.rea@cbre.com.au

USD252 1.0% 10.9%

Security

AV Soft Cost

9.9%

USD168 0.6%

IT Builder Works

8.7%

M&E Works Furniture

8.3%

USD115 0.7% 6.0% 8.0%

7.6% 10.7%

26.4%

26.2%

13.6% 28.8%

27.3% 30.9% 31.6% 12.8% Basic

15.7% Medium

14.3%

High

GLOBAL WORKPLACE SOLUTIONS

59

PACIFIC COST ANALYSIS – MELBOURNE MELBOURNE The Melbourne CBD has seen strong growth in white collar jobs. This was the largest rise across the capital city CBD markets. Key growth industries are expected to include accommodation & food, professional services, the public sector and administrative services.

IAN REA Managing Director Pacific Project Management +61 2 9333 9102 ian.rea@cbre.com.au

USD200 1.2% 13.8%

Security

AV Soft Cost

IT

USD133

7.3%

0.8%

12.4%

M&E Works

10.4%

USD92

9.5%

0.9%

9.5%

7.5% 14.7%

25.4%

26.2%

10.0% 26.1%

26.9% 29.3% 28.6% 11.4% Basic

60

ASIA PACIFIC FIT-OUT COST GUIDE

14.3% Medium

Builder Works

13.8% High

Furniture

PACIFIC COST ANALYSIS – BRISBANE BRISBANE While CBD net absorption exceeded expectations in 2016, more modest take up is expected in the next two years. The most recent office development cycle peaked in 2016, there will be minimal change to stock levels in the next two years.

USD193 1.3% Security

14.2%

AV Soft Cost

IT

USD130

12.8%

Builder Works M&E Works

0.8%

7.9%

Furniture

10.6%

USD89

9.7%

0.8%

9.5%

7.8% 10.4%

22.9%

25.2%

12.9% 25.8% 26.7% 28.4% 30.1% 11.3% Basic

15.8% Medium

15.1%

High

GLOBAL WORKPLACE SOLUTIONS

61

PACIFIC COST ANALYSIS – PERTH PERTH Rents are at or near their low point while vacancy is expected to begin its forecast decline. The CBD is also benefiting from a “flight to centre” from the suburbs as tenants take advantage of competitive rents to upgrade accommodation they could traditionally not afford.

IAN REA Managing Director Pacific Project Management +61 2 9333 9102 ian.rea@cbre.com.au

USD239 1.0% Security

11.5%

AV Soft Cost

USD165 0.7%

10.4% 10.0%

8.4% 7.7%

USD108

13.3%

25.5%

0.8% 6.4% 8.6%

25.8%

14.3% 26.9% 27.0% 29.1% 28.6% 11.3% 14.3% Basic

62

ASIA PACIFIC FIT-OUT COST GUIDE

15.0% Medium

14.7% High

IT Builder Works M&E Works Furniture

PACIFIC COST ANALYSIS – AUCKLAND AUCKLAND The property market impact of the softer term economic scenario translate to softer demand growth for the year, especially in the retail and office markets. The overall implication of the supply demand projections has resulted in weaker aggregate rent growth across most market sectors.

USD220 1.1% 12.5%

Security

AV Soft Cost

11.3%

USD143 0.8%

IT Builder Works M&E Works

12.8%

Furniture

9.6% 8.8%

USD83

16.2%

1.0% 8.3% 11.1%

30.7%

18.3% 31.8%

27.0%

24.0% 24.2%

21.5% 8.0%

9.7%

Basic

Medium

11.3% High

GLOBAL WORKPLACE SOLUTIONS

63

REGIONAL FIT-OUT PROJECT TIMELINE

64

ASIA PACIFIC FIT-OUT COST GUIDE

GLOBAL WORKPLACE SOLUTIONS

65

PROJECT TIMELINE The table below provides typical project timelines (in months) for a standard new office fit-out project employing the typical procurement strategy for each size category and each market. The timelines are indicative for agency services only from Project Management appointment to handover and project closeout, excluding reinstatement.

Please note that this is a guide only.

Timelines for a specific project must be reviewed based on its merits such as location, authority approval process, stakeholder availability and proximity, building type, project brief, and market demands are just a few factors that affect the project duration. Please approach the CBRE Division Lead in each market for accurate project timeline estimates.

Region

North Asia

Country

Tokyo

6

7

Beijing

5

5.5

Shanghai

5

6

Guangzhou

5

5.5

Taipei

4

5.5

4

5

Sydney

4

5.5

Melbourne

4

5.5

Perth

4

5.5

Brisbane

4

5.5

4

5.5

Taiwan

Hong Kong Hong Kong

Pacific

ASIA PACIFIC FIT-OUT COST GUIDE

6

Japan

Greater China

South Asia

5

Seoul

China

South East Asia

10,001 – 20,000 SF

South Korea

Australia

66

City

5,001 – 10,000 SF

New Zealand

Auckland

Philippines

Manila

5

6

Vietnam

HCMC

4

5

Indonesia

Jakarta

6

6

Malaysia

Kuala Lumpur

4

5

Singapore

Singapore

4

5

Thailand

Bangkok

5

5.5

Mumbai

5.5

6

Hyderabad/Kolkata/Pune

5.5

6

Bangalore/Chennai/Delhi

5.5

6

India

20,001 – 30,000 SF

30,001 – 40,000 SF

40,001 – 50,000 SF

50,001 – 60,000 SF

60,001 – 70,000 SF

70,001 80,000 SF

80,001 – 90,000 SF

6

7

8

8

9

9

9

6.5

7.5

6.5

90,001 100,000 SF

100,001 – 150,000 SF

8

9

10

10

14

11

11

12

13

13.5

14

8

8.5

9

10

10

11

13

7.5

8

8.5

9

10

11

12

14

6

7

7.5

8

8

9

10

11

13

6

7

7

7 .5

8

8

9

11

11

6

6.5

7.5

8

8

9

10

11

13

6

7

7.5

8

9

10

11

13

15

6

7

7.5

8

9

10

11

13

15

6

7

7.5

8

9

10

11

13

15

6

7

7.5

8

9

10

11

13

15

6

7

7.5

8

9

10

11

13

15

6

7

7.5

8

8

9

10

11

13

6

6

7

8

8.5

9

9.5

11

13

6

6.5

7.5

8

8

9

10

11

13

6

6.5

7.5

8

8

9

10

11

13

6

6.5

7.5

8

8

9

10

11

13

6

6

7.5

8

8.5

9

10.5

11

14.5

6

6

6

7

7

7.5

7.5

7.5

8.5

6

6

6

7

7

7.5

7.5

7.5

8.5

6

6

6

7

7

7.5

7.5

7.5

8.5

GLOBAL WORKPLACE SOLUTIONS

67

KEY CONTACTS CBRE CONTACTS Martin Woods Senior Managing Director, CBRE Project Management, Asia Pacific +852 2820 2869 martin.woods@cbre.com.hk

Zac Zdravev Executive Director CBRE Project Management, Asia Pacific +65 6326 1661 zac.zdravev@cbre.com.sg

Nick Lee

ACKNOWLEDGEMENTS Michael Harrington Senior Managing Director CBRE Enterprise Facilities Management, Asia Pacific +65 6347 8886 mike.harrington@cbre.com Desmond Sim Head of Research Singapore & Southeast Asia +65 6326 1638 desmond.sim@cbre.com.sg

Lee Seng Han Senior Operations Manager CBRE Project Management, Asia Pacific +65 6328 7322 senghan.lee@cbre.com Kathy Miag-ao Operations Manager CBRE Project Management, Asia Pacific +65 6326 1639 kathy.miagao@cbre.com.sg

Ada Choi

Senior Director CBRE Project Management, Asia Pacific +852 2820 8178 nick.lee@cbre.com.hk

Executive Director CBRE Research, Asia Pacific +852 2820 2871 ada.choi@cbre.com.hk

Rohini Saluja

Cynthia Chan Associate Director CBRE Research, Asia Pacific +852 2820 2839 cynthia.chan@cbre.com.hk

Executive Director, Asia Pacific CBRE Advisory & Transaction +65 6326 1665 rohini.saluja@cbre.com.sg

Peter Andrew Senior Director CBRE Workplace Strategies, Asia Pacific +65 6326 1677 peter.andrew@cbre.com.sg

Andrew Green Group Director PTS Consulting Group andrew.green@ptsconsulting.com Brendan Bruce Managing Director Haworth, South East Asia brendan.bruce@haworth.com

Š 2018 CBRE Group, Inc. All Rights Reserved. CBRE has taken every care in the preparation of this report. The sources of information used are believed to be accurate and reliable, but no guarantee accuracy or completeness can be given. Neither CBRE, nor any CBRE company, nor any director, representative or employee of CBRE company, accepts liability for any direct or consequential loss arising from the use of this document or its content. The information and opinions contained in this report are subject to change without notice.

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