Cushman & Wakefield Research

MARKETBEAT
RETAIL SNAPSHOT
BANGKOK, THAILAND
A Cushman & Wakefield Research Publication

Q2 2012

ECONOMY
According to the National Economic and Social Development Board (NESDB), Thailand's GDP rose by 0.3% in the first quarter of 2012, improving from a sharp decline of 8.9% in the previous quarter. Household consumption expanded by 2.7%, improving from a drop of 2.8% in the previous quarter. Recovery was chiefly attributed to non-durable and semi-durable items whereas durable items kept falling. The Thailand Financial Policy Office had forecast that the Thailand economy would grow by 5.0% to 8.0% in 2012 as a result of the expanding household consumption and the increasing minimum wage of THB300 per day. CPI was projected at 3.6% in 2012, a drop as compared to last year due to the declining global oil prices and the slowdown of the European economy. Thailand's economy slowed down last year due to the nationwide flooding. But in 2012, the GDP is expected to expand by 5% to 6% as a result of the increase in private consumption. The retail sales index (base at 2002) will continue to rise, as reflected by its growth of 178.7 and 186.1 in 2010 and 2011, respectively. ECONOMIC INDICATORS
NATIONAL GDP Growth CPI Growth Private Final Expenditure Growth Govt. Final Expenditure Growth
SOURCE: NESDB as of November 21, 2011 REMARKS: * Q1-2012 Figure

2010 7.8% 3.3% 4.8% 6.4%

2011 0.1% 3.6% 1.3% 1.1%

2012F 5.0 - 6.0% 4.5%* 2.7%* -1.6%*

PRIME RETAIL RENTS ­ JUNE 2012
MAINSTREETS Central Retail District (CRD) CRD Fringe & Urban LOCAL CURRENCY THB3,000/sq.m./mo THB1,900/sq.m./mo EURO SF/YR 83.85 53.11 US$ SF/YR 105.44 66.78 6-MONTH CHANGE Y-O-Y CHANGE 0.00% 5.56%

3.45% 10.14%

SIGNIFICANT LEASING TRANSACTIONS
PROPERTY Siam Paragon LOCATION CRD, Rajprasong TENANT H&M SQUARE FEET 32,289

SUPPLY/DEMAND RISING
Bangkok's retail market has achieved an additional 4.99 million square meters (sq.m.) of space. It encompassed the Bangkok Central Retail District's (CRD) 524,545 sq.m. with 94% occupied, a slightly decline of 1.34% from last quarter as a result of Siam Paragon's partial renovation. Meanwhile, supply in the Bangkok Fringe and Urban areas comprised a total of 4.42 million sq.m.

SIGNIFICANT PROJECTS UNDER CONSTRUCTION
PROPERTY Gateway Central Embassy Emporium 2
REMARKS: * estimated

LOCATION Ekkamai Ploenchit Sukhumvit 35

SQUARE FEET 355,080 753,200 645,600*

COMPLETION DATE 3Q12 4Q14 4Q14*

RENTS SLIGHTLY UP
Rents in the CRD remained unchanged at THB3,000 per square meter per month (/sq.m./mo). In the CRD Fringe and Urban, rents stood at THB1,900/sq.m./mo. Rental rates in the CRD Fringe and Urban areas were slightly up as some operators claimed that the increasing minimum wage of THB300 per day caused their expenses to rise.

OUTLOOK
Currently, Bangkok's retail market is highly competitive in terms of new developments, new renovations and sales promotions. It has attracted many retailers to open up outlets and we will be expecting a long waiting list in prime space at prime locations. The occupancy cost reflects a rising trend due to the increasing minimum wage THB300 per day which will affect all business sectors. Moreover, the increasing cost of electricity will also cause tenant's expenses to be higher.

Nexus Property Consultants Co., Ltd. In Association with Cushman & Wakefield 31st Fl., BKI Building/ Y.W.C.A. 25 South Sathorn Road, Thungmahamek, Sathorn, BKK 10120, Thailand Tel: +66 2 286 8899 www.cushmanwakefield.com

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