2010 Global Market Report - NAI Commercial Real Estate

GuamChennai, IndiaContactNAI ChaneyBrooks+1 671 649 8742Country DataArea (KM 2 )GDP Growth (%)GDP 2009 (US$ B)GDP/Capita (US$)Inflation Rate (%)1334.3N/A$2.70$15,000.002.50%Massive construction is expected to take place to accommodatethe transfer of approximately 8,000 US Marines and9,000 military dependents plus support personnel fromOkinawa to Guam by 2015. Island population is projectedto grow as much as 25% over the five-year period. Inanticipation of the build-up, more than 15,000 foreignlaborers, primarily from the Philippines and South EastAsia, are in Guam, representing the first wave of populationgrowth.Meanwhile, Guam continues to remain one of the mostpopular tourist destinations for the Asian markets, primarilyfor the Japanese and Koreans. Industry experts continue todebate the impact of the construction and military build-upon the island’s allure as a resort destination. The growth isexpected to result in pent up demand for industrial, residentialand office products, in this order. Hotels and shoppingcenters should also see an immediate benefit from the influxof new residents and transient workers. Guam’s officemarket is expected to gradually show steady gains ascontractors and government-related offices begin setting upoperations in the island. Due to the lack of quality officeproduct, the market will be ripe for new office buildingdevelopment, especially in the Hagatna and Tamuningregions. Until new inventory is introduced, the demand foroffice property should begin to drive up office rents.Guam’s future looks bright and continues to benefit from ageneral sense of optimism from both opportunistic US andforeign investors. Over the course of the next three yearsGuam’s real estate market should prove to be one of themost stable markets in the United States.ContactNAI Hemdev'sInternational RealtyServices+91 44 2822 9595Country DataArea (KM 2 )GDP Growth (%)GDP 2009 (US$ B)GDP/Capita (US$)Inflation Rate (%)1334.35.36%$1,242.65$1,032.718.66%Commercial real estate transactions, considered a keyindicator of economic activity in Chennai, began showing thefirst signs of stability with over 1.7 million SF of space havingbeen absorbed in Chennai during the first three quarters of2009. Suburban markets of Manapakkam, Perungudi andAmbattur continue to be most favored by companies becauseof proximity and quality space available.The commercial real estate market in 2009 saw a declinein rentals, lower absorption and increasing vacancy rates.Following the financial turmoil, a paradigm shift in theperception of risk was witnessed, resulting in a weakeningof demand, the slow-down of expansion plans and migrationto more cost-effective locations, all of which put pressure onlease rentals.A pick-up in inquiries for space from the hospitality, healthcareand educational sectors was witnessed in Q2 and Q3.Residential land transactions saw more activity in Q2 andQ3 in central areas of the city for fairly priced properties byend-users.Most retail micro markets saw a correction in rentalvalues in line with the downward rental trends witnessed inIndia. There has been a slight upward trend in thenumber of inquiries for retail space since Q2 with retailerstaking into account the corrections seen in rentals, and landlordsbeing more open to reasonable prices.One of the highlights in the retail market in Chennai was theopening of The Ampa Skywalk Mall. Mall space supply is setto increase in 2010 with the opening of ExpressAvenue and Coromandel Plaza. The market for return oninvestment properties saw a pick up with buyers scouting fortenanted office spaces as the prices reached realistic levels.With good quality supply readily available, it will take sometime for the supply-demand gap to be bridged. Therefore,rates in the commercial real estate market are expected toremain stagnant or under downward pressure for themedium term.UnemploymentRate (%)11.40%UnemploymentRate (%)7.32%Interest Rate(%)N/AInterest Rate(%)4.75%Population (Millions)0.178Population (Millions) 1203.28Guam At A Glance(Rent/SF/YR) Low High Effective Avg. VacancyDOWNTOWN OFFICENew Construction (AAA)Class A (Prime)Class B (Secondary)SUBURBAN OFFICENew Construction (AAA)Class A (Prime)Class B (Secondary)INDUSTRIALBulk WarehouseManufacturingHigh Tech/R&DRETAILDowntownNeighborhood Service CentersCommunity Power CenterRegional Malls$$$$$$$$N/AN/A26.00N/AN/A14.007.807.80N/A33.0013.009.6036.00N/AN/A$ 42.00N/AN/A$ 36.00$ 18.00$ 18.00N/A$ 108.00$ 60.00$ 15.00$ 72.00$$$$$$$$N/AN/A28.20N/AN/A19.7512.3512.35N/A72.0031.0011.2554.00N/AN/A18.0%N/AN/A23.0%12.0%12.0%N/A16.0%N/AN/AN/ADEVELOPMENT LANDOffice in CBDLand in Office ParksLand in Industrial ParksOffice/Industrial Land - Non-parkRetail/Commercial LandResidentialLow(Price/Acre)High(Price/Acre)N/AN/AN/AN/AN/AN/A$ 753,000.00 $1,077,000.00$2,018,000.00 $2,023,000.00$ 108,000.00 $ 680,000.00Chennai At A GlanceConversion: 46 INR = 1 US$ RENT/SF/MO US$ RENT/SF/YRLow High Low High VacancyDOWNTOWN OFFICENew Construction (AAA)Class A (Prime)INR 60.00INR 60.00INR 70.00INR 75.00$ 15.65$ 15.65$$18.2619.57N/AN/AClass B (Secondary)SUBURBAN OFFICENew Construction (AAA)Class A (Prime)Class B (Secondary)INDUSTRIALBulk WarehouseManufacturingHigh Tech/R&DRETAILINR 35.00INR 25.00INR 25.00INR 20.00INR 12.00INR 17.00INR 18.00INR 50.00INR 45.00INR 45.00INR 35.00INR 20.00INR 22.00INR 25.00$$$$$$$9.136.526.525.223.134.434.70$$$$$$$13.0411.7411.749.135.225.746.52N/AN/AN/AN/AN/AN/AN/ADowntownNeighborhood Service CentersCommunity Power CenterINR 100.00INR 50.00N/AINR 150.00INR 80.00N/A$ 26.09$ 13.04N/A$$39.1320.87N/AN/AN/AN/ARegional MallsINR 35.00 INR 60.00 $ 9.13 $ 15.65 N/ASolus Food StoresDEVELOPMENT LANDINR 39.00Low/AcreINR 45.00High/Acre$ 10.17Low/Acre$ 11.74High/AcreN/AOffice in CBDLand in Office ParksLand in Industrial ParksOffice/Industrial Land - Non-parkRetail/Commercial LandResidentialINR 4,000 INR 6,000 $ 86.96 $ 130.43N/A N/A N/A N/AINR 3,200,000 INR 10,000,000 $ 69,565.22 $ 217,391.30N/A N/A N/A N/AINR 540,000,000 INR 720,000,000 $ 11,739,130.43 $ 15,652,173.91INR 270,000,000 INR 600,000,000 $ 5,869,565.22 $13,043,478.262010 Global Market Report ■ www.naiglobal.com 30