Red Paper - July 2014 - CHINA OFFICE PIPELINE AND DYNAMICS COMING WAVE OF SUPPLY …NOT AS BAD AS IT LOOKS

The Chinese office market is entering into a period of unprecedented supply over the next three years. There is
a 25.6 million sq m pipeline planned for completion between 2014 and 2016. This is triple the 8.2 million sq m
supply which came on stream between 2011 and 2013.

This report is authored by Andrew Ness, Dennis Fung and Kenneth Chiu from DTZ. 

マクロ経済 成長率見通しの下方修正が相次ぐ

• 2014 年3 月10 日に発表された2013 年10-12 月期の実質GDP 成長率（2 次速報）は年率+0.7%（季節調整済み前期比）となった。これは事前の予想を下回るものであったため、2013 年及び2014 年のGDP 成長率見通しを下方修正する調査機関が相次いでいる。
• 10-12 月期実質GDP の寄与度をみると、内需は+0.7%と概ね予想通りであったのに対し、外需は-0.5%と、7-9 月期に続きマイナスとなっている。民間企業設備投資が前期比年率+3.0%、民間最終消費支出が同+1.6%となるなど、国内需要は事前の予想通り改善傾向を示している。
• 今回、予想外だったのは外需の弱さであった。財貨・サービスの輸出は+1.7%とプラスに転じたものの力強さにかけ、一方で輸入は+14.7%と大幅に増加した。円安傾向となって1 年ほど経過したにもかかわらず、輸出が伸び悩んでいる点が懸念されるが、これに関しては、①海外経済の回復ペースが鈍いこと、②生産拠点の海外移転が進み、輸出数量の為替感応度が低減している可能性、③円安が進む中でも、企業が輸出価格を引き下げていない可能性、④電気機械部門などの一部セクターにおいて貿易赤字が拡大しているため、などの理由が考えられている。

MACROECONOMIC CONDITIONS

A SUCCESSION OF DOWNWARD REVISIONS TO THE PROJECTED ECONOMIC GROWTH RATE
• The real GDP growth rate for October-December 2013 (second preliminary figures), announced March 10, 2014,
was an annualized rate of 0.7% (QoQ, seasonally adjusted). Since this was lower than previous expectations, a
succession of research institutions have revised downward their projected GDP growth rates for 2013 and 2014.
• A look at contributors to real GDP in October-December shows that while domestic demand largely met
expectations with growth of +0.7%, foreign demand showed negative growth, as it had in July-September, at
-0.5%. As had been expected, domestic demand showed an improving trend. For example, capital investment by
private firms grew by +5.3% (QoQ, annualized rate) and private final consumption expenditure by +2.0% (QoQ,
annualized rate).
• An unexpected component of this quarter’s figures was the weakness of foreign demand. Although exports of
goods and services rebounded to show positive growth at +1.7%, they were lacking in terms of strength, and in
contrast imports grew substantially at +14.7%. Despite the fact that the downward trend in the yen has continued
for about one year, there are concerns about the weak growth in exports. Possible reasons for this include (i)
the slow pace of economic recovery overseas, (ii) the possibility of decreased sensitivity of export volumes to
exchange rates as the shift of production facilities overseas advances, (iii) the possibility that companies are not
lowering export prices despite the growing devaluation of the yen, and (iv) increasing trade deficits in some
sectors, such as electrical machinery.

This report is authored by Yuki Hatano from Kenedix.

本報告書は、ANREV/INREV ファンドマネージャー調査2014 の結果をまとめたものである。同調査は2013 年12 月31 日現在、各ファンド運用会社が取り扱っている運用不動産資産の総額(AUM) に関する内容だ。

調査は３つの部分から構成されている。第１部は不動産に直接・間接的に投資する上場および非上場投資ビークルに対するすべての不動産AUMに関する内容である。第２部は非上場直接不動産投資ビークルに焦点を当てて、ファンド/ 合同運用ファンド、分離勘定、合弁投資、クラブディールについて記載されている。第３部は非上場不動産ファンド/合同運用ファンドについてである。最後に、今回の調査に協力してくださったファンド運用会社のリストが別添として添付されている。

ANREV is now collecting investor reporting documents for its fifth Review of Investor Reporting Trends 2014, a survey of non-listed real estate funds in the Asia Pacific Region.

This project, which is again being undertaken in co-operation with PwC, reviews reporting practice in the Asia Pacific region in relation to the INREV Guidelines. It aims to analyse non-listed real estate funds’ investor reporting to determine the extent to which they comply with the INREV Guidelines on annual and interim reporting and to identify the current market best practices for this topic in Asia-Pacific. The INREV Guidelines were recently reviewed, updated and reissued, to access them click here: INREV Guidelines - ANREV.

Whilst 2013 investor reporting was performed whilst the new Guidelines were in White Paper form, the 2014 report will look at compliance with the new Guidelines. 

In order to assess compliance with INREV Guidelines, we would like to invite you to fill the self-assessment questionnaire, to access them click here: Guidelines_Compliance_Checklist. We would appreciate if you could send it back together with your latest audited annual reports and interim reports before 22 July 2014.  Note that in Asia, the “interim reports” required by the Guidelines, would often be the quarterly reports sent to investors, and in some cases, presentations which are made in quarterly investor calls. Each manager may determine what documents to submit, depending on how they report to investors, and where information relevant to the Guidelines is presented. Managers may wish to submit Q4 quarterly report, if one is issued to the same date as audited financial statements.

As with previous Investor Reporting studies, participating fund managers will be provided with high-level individual feedback on the reporting performance of their funds and areas for potential improvement, with a follow up physical meeting or phone call to discuss the findings.

To preserve confidentiality, your reporting documents should be submitted directly to PwC (contact details below). All information submitted by fund managers for the purposes of the study will be treated confidentially. ANREV management may also attend some feedback meetings unless a participant requests them not to. More information about PwC and their assurance on confidentiality are provided below.  

We would therefore appreciate it if you could send the latest audited annual reports and quarterly investor reports for your non-listed real estate funds to us as it becomes available at the address below, before 22 July 2014.

Private & Confidential

PwC

21/F, Edinburgh Tower

15 Queen’s Road, Central

Hong Kong

Attention: Stanley Tam

E-mail: [email protected]

If you have any questions with regard to the project please do not hesitate to contact the PwC project leader, Mr. Paul Walters, or Amelie Delaunay.

Thank you in advance for your support.We look forward to receiving your responses. 

Information on PwC

PwC helps organisations and individuals create the value they’re looking for. We’re a network of firms in 158 countries with more than 180,000 people who are committed to delivering quality in assurance, tax and advisory services. Tell us what matters to you and find out more by visiting us at www.pwc.com.

PwC refers to the PwC network and/or one or more of its member firms, each of which is a separate legal entity. Please see www.pwc.com/structure for further details.

CONFIDENTIALITY

PwC will treat all fund annual reports and other information provided by ANREV members and other fund managers for the purposes of this project as confidential and in accordance with PwC’s normal confidentiality policies and procedures. All such reports and other information provided for the project will only be used for the purposes of the project and will be stored in a secure location.

Neither the names of the participants in the study nor any financial data in the reports submitted will be published or referenced in the final report or otherwise. 

近年グローバル市場は不安定な状態が続いています。過去数年にわたり市場を支えてきた国債購入政策を撤回する米連邦準備銀行（FRB）の動き、米欧中の経済成長率の差、新興市場に漂う緊張感に投資家は神経をとがらせています。

でも、これはそんなに悪い状況でしょうか？

グローバル経済を修復するために「ステロイド剤」が投与されると世界は正常化へ向かい、アジアにとっても良い兆しとなっています。金融緩和策を縮小することにより、FRBは米国経済が好転しているとのメッセージを発し、アジア経済にもプラスの効果をもたらしています。「ホット」マネーの流入によって当初恩恵を受け、その後逆の影響が見られなかった一部の市場へと投資家が再び参入する機会が訪れています。

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著作権はウェイ・チュン・ロー（Whye Choong Low）, Head of Asia Pacific, Composition Capital Partnersに帰属します。