MARKETBEAT

BEIJING RETAIL REPORT
A CUSHMAN & WAKEFIELD RESEARCH PUBLICATION

1Q 2010

PRIME RETAIL RENTS AS OF 1Q 2010
Location *Asking Rent (*Net Rent) RMB /sq.m. /sq. m. /mth /yr

780 1105

RETAIL MARKET OVERVIEW Following the gradual recovery from the economic recession, the prime retail rents have increased in Q1 2010. Rent of Xidan has first time been the number one in Beijing retail market and left Wangfujing behind. CBD rent has increased both compared to Qand year-on-year. Sanlitun has grown into a mature submarket with rents surpassing those in CBD and right under the Xidan and Wangfujing rents. As a new mature submarket, Zhongguancun also experienced an increase in rents in Q1 2010. However, due to an unfavorable trade mix and simultaneous supply of new projects, Wangfujing area suffered a 21.9% decline in rents, making Wangfujing the only submarket with reduced rents. CURRENT STOCK AND NEW SUPPLY The stock of retail developments larger than 10,000 sq. m increased by 290,000 sq. m to 17.52 million sq. m in 1Q 2010, with Regal Court-Hua Lian at West Dawang Road, and Poly Golden Plaza at Datun East Road as some of prominent new projects on the market. RETAIL MARKET REMAINS DYNAMIC The positive performance of the macro economy infused vitality into the retail market. Retail sales in Beijing increased by 15.1% for the year up to February 2010. Meanwhile, the number of foreign tourists increased by 19.8% for the year up to February 2010. The relatively active market encouraged a number of retailers to expand in Beijing, like CJ CGV. Disney English opened two new locations in One City and Glory Mall, after the successful opening of the first branch in EC Mall in Beijing.
%Change from (Local Currency) US$ /sq. ft mth yr /yr ago ago
139 4.7% -21.9% 19.4% 4.7% N/A 9.1% -22% 6.8% -8% N/A

6mth Outlook

Xidan Wangfujing CBD Zhongguancun Sanlitun
Notes: 1.* Asking rents are based on ground floor in prime locations in major shopping centers. 2.* Net rent is on a net floor area basis and excludes outgoings such as management fee and promotion fee etc. 3. The exchange rate: USD 1 = RMB6.8269= EUR0.7396
SIGNIFICANT NEW LEASE TRANSACTIONS

Building

Office Park Office Park One City (Wangjing) Landgent Center Glory Mall Olympic Park Retail Mall

Tenant

Candy Group Wonderful Eats Disney English Disney English Dazzle CJ CGV

Sq. m.

150 8,000+

Location

CBD CBD CBD CBD Chongwen Yaao

New Q1 Openings

Project

China Central Place

Candy & Caviar

ECONOMIC INDICATORS

Latest Release (Year-on-Year % Change)
Real GDP Growth CPI Retail Sales Real Estate Investment 2009 Jan-Feb 10 Jan-Feb 10 Jan-Feb 10 10.1% 0.5% 15.1% 71.0%
SIGNIFICANT PROJECTS UNDER CONSTRUCTION

Average FY2008 FY2009

9.0% 5.1% 8.9% -4.4% 10.1% -1.5% 15.7% 22.5%
New Friendship Store Parkview Green BHG Wanliu Mall Joy City-Chao Bei Dazhongsi Intl Plaza

GFA (sq. m.)

35,000 45,600 110,000 280,000 136,000

Completion Date

2Q 2010 2Q 2010 2Q 2010 2Q 2010 2Q 2010

CBD Shopping Center CBD Shopping Center ZGC Shopping Center CBD Shopping Center ZGC Shopping Center
Sources: Beijing Municipal Bureau of Statistics.

HIGHLIGHTED PROPERTIES

Poly Golden Plaza Address Location Type Datun East Road Yaao Shopping centre

BEAT ON THE STREET

Beijing market saw a lot of new supply in the market in Q1 2010, which will provide more favorable choice options for customers and retail brands site selection. Some shopping malls in mature districts, like Xidan Joy City and Beijing APM, decided to adjust the tenant mix to attract more brands and customers to improve their competitiveness which will mean more choices for certain retail brands. Sam Lee, Associate Director
Total Retail Area 200,000 sq. m Completion Date 1Q 2010
For further information, please contact Sam Lee, Associate Director Tel: (86 10) Email: sam.lee@ap.cushwake.com Units 602-607, Tower I China Central Place, No. 81 Jianguo Lu, Chaoyang District, Beijing 100025, China www.cushmanwakefield.com
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