INSIDE OFFICE MARKET VILNIUS, LITHUANIA 2018 Q1

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1 INSIDE OFFICE MARKET VILNIUS, LITHUANIA 2018 Q1 Office campus S7, Vilnius, Lithuania.

2 MODERN OFFICE PREMISES INSIDE OFFICE MARKET VILNIUS, LITHUANIA 2018 Q1 MODERN OFFICE PREMISES SUPPLY By the end of Q1 2018, the stock of modern office premises in Vilnius was 604,400 sqm, or 1.1 sqm per capita. There was one new office project completed during Q and the total office stock increased by almost 9,000 sqm of leasable area, or 1.5% in comparison to Q It is expected that during , approx. 148,050 sqm of new office space will be commissioned in Vilnius. Ten out of twelve planned projects are currently under construction. Developers focus still remains on prime schemes more than 70% of constructed stock is class A offices. VACANCY The first tenants started to move into the new office building LINK in Q The project was 100% pre-leased before launching. The current tenants of the building are Teltonika, Cognizant, BNS, Diginet, 15min and ilunch. The latest openings of new projects did not increase Vilnius office market vacancy rates as all of them were almost fully pre-leased, which indicates strong demand for modern office stock. The average vacancy at class A properties fell to 1.6% and at class B properties to 3.9%. So in Q1 2018, the average vacancy rate of classified office buildings in Vilnius decreased to 3.0%, which remains one of the lowest in Europe, but this is expected to start growing slightly again in the near future due to scheduled openings of new vacant projects. DEMAND In 2017, the total take-up of modern offices amounted to more than 80,000 sqm. Such a high yearly amount marked an all-time record in the Vilnius office market. Nearly 70% of these transactions were advised by Newsec. The year 2018 started with one more large transaction in the Vilnius office market by the banking group SEB signing for 10,000 sqm in a new office building on Konstitucijos Avenue planned by Lords LB, which will be delivered in Newsec acted for SEB in this transaction. Advance lease deals are typical in the Vilnius office market, with leases often being signed six to 18 months prior to handing over the space. RENTAL RATES In Q1 2018, the average market rent for prime office space in Vilnius CBD ranged from 14 to 16 EUR/sqm/month, reaching 17 EUR/sqm/month in some cases. In other central areas rents were in the range of EUR/sqm/month, whereas rents in class B offices further from the city centre averaged 8-11 EUR/ sqm/ month. The highest class B rents were captured in campuses and professionally managed buildings. Rental rates are increasing slightly as new projects offer higher quality standards. OFFICE STOCK DEVELOPMENT: DYNAMICS OFFICE CONSTRUCTION IN , sqm Sqm % 29% E 2019E Existing stock Additional stock A CLASS B CLASS 2

3 INSIDE OFFICE MARKET VILNIUS, LITHUANIA 2018 Q1 MODERN OFFICE PREMISES «Vacancy is expected to start growing slightly again in the near future due to scheduled openings of new vacant projects» VACANCY RATE, % RENT, EUR/sqm/month 25% 20% 15% 10% 5% 0% 2009 Q Q Q Q Q Q Q Q Q Q Q Q Q Q Q Q Q Q Q Q Q Q Q Q Q Q Q Q Q Q Q Q Q Q Q Q Q Q Q Q Q Q Q Q Q Q Q Q Q Q Q Q Q Q Q Q Q Q Q Q Q Q Q Q Q Q Q Q Q Q Q Q1 Vacancy rate A class Vacancy rate B class Rent A class Rent B class OFFICE DEVELOPMENT IN VILNIUS IN Developer / Owner Location / Name GLA, sq m Description Status Exp. Finishing Baltijos Gildija LINK A class, CBD Completed 2018 Asgaard Property Asgaard keys A class, CBD Construction 2018 Eastnine Sail no A class, CBD Construction 2018 Hanner Business Stadium, stage I A class, CBD Construction 2018 YIT Duetto, stage II B class, Virsuliskes Construction 2018 M.M.M. Projektai Saltoniskiu 7, stage II A class, CBD Construction 2019 M.M.M. Projektai Saltoniskiu 7, stage III A class, CBD Construction 2019 MG Valda Park Town, stage II A class, CBD Construction 2019 EIKA Live Square A class, Central area Construction 2019 PST U B Class, Ukmerge st. Construction 2019 MG Valda Paupys B+ Class, Uzupis Construction 2019 Urban Inventors Green Hall, stage III A class, CBD Planned 2019 Schage Quadrum, stage III A class, CBD Planned 2019 TOTAL

4 MODERN OFFICE PREMISES INSIDE OFFICE MARKET VILNIUS, LITHUANIA 2018 Q1 4 OFFICE BUILDINGS IN VILNIUS No Project Name Address, street Openings of Link Saltoniskiu str. 9b 2 Duetto II Virsuliskiu ln Bures III Giedraiciu str. 3 4 Asgaard Keys Ukmerges str Business Stadium I Rinktines str. 5 Openings of Quadrum Business City II Konstitucijos ave. 21b 7 Green Hall III Upes str Park Town II Lvovo str. 105A 9 S7 II Saltoniskiu str Live Square Dainavos str S7 III Saltoniskiu str Paupys Paupio str. 13 U219 Ukmerges str. 219 Openings of 2020 and later 14 k18b Konstitucijos ave. 18b 15 SEB HQ Konstitucijos ave St. Jacob Vasario 16-osios str Business Stadium II Rinktines str. 5 Spruce pine spruce 18 Business Garden I Laisves ave Nova V. Gerulaicio str. 18 Existing Office buildings 20 Quadrum Business City I Konstitucijos ave. 21, 21c 21 Park Town I Lvovo str Green Hall 2 Upes str S7 I Saltoniskiu str Penta Ozo str. 12a 25 Narbuto 5 Narbuto str Domus Pro Bieliunu str Duetto I Spaudos str Eleven Kareiviu str B Nordic 26 J. Basanaviciaus str City Zalgirio str Zalgirio str Delta J. Balcikonio str Highway Savanoriu str Uniq A. Gostauto str. 12a 35 k29 Konstitucijos ave Premium Sporto str IBC (International Business Centre) Seimyniskiu str. 3a, 3, 1a / A. Juozapaviciaus str. 6/ Bures Lvovo str Europa Konstitucijos ave Swedbank Headquarters Konstitucijos ave. 20a 41 GV18A Gelezinio Vilko str. 18a 42 Danske Bank Saltoniskiu str Saltoniskiu 10C Saltoniskiu str. 10c 44 Baltic Hearts Ukmerges str Green Hall Upes str Marenta Business Centre Kestucio str Vertas Gyneju str Merchants' Club Gedimino ave Plaza 31/1 Vilniaus str. 31 / Islandijos str Business Centre 2000 Jogailos str Basanaviciaus 15 J. Basanaviciaus str BC 12 J. Jasinskio str MG Baltic J. Jasinskio str. 16, 16a, 16b, 16c 54 Eika Business Centre A. Gostauto str. 40a, 40b 55 G40 A. Gostauto str Vilbra Business Centre Svitrigailos str. 11b, 11h, 11m 57 Vytenio 46 Vytenio str Skraidenis Naugarduko str. 100, LJB Savanoriu ave Evita Savanoriu ave L3 Laisves ave JIN&JAN Menulio str. 7, Trapecija Pilaites ave Atea J. Rutkausko str Grand Office Virsuliskiu ln Orange Office Senasis Ukmerges Rd GRIGISKES Trio Perkunkiemo str. 3, 5, 7 68 Business Park Four Perkunkiemo str. 2, 4, 6 69 One Ukmerges str Kamane Ukmerges str. 369a 71 Sostena Ukmerges str Evolution Ukmerges str Akropolio Business Centre Ozo str BH-92 Zalgirio str Zalgirio Business Centre Zalgirio str North Star Ulonu str Ulonu Business Centre Verkiu str. 25c / J. Galvydzio str Domus Centre P. Luksio str Ozo Business Centre Ozo str. 10a 80 Alfa V. Gerulaicio str Beta J. Balcikonio str Gama Kalvariju str NCBC Kareiviu str Eta Zirmunu str Zirmunu Business Centre Zirmunu str Sunrise Valley Sauletekio ave VITP Mokslininku str. 2a GARIUNAI TARANDE PILAITE LAZDYNELIAI Under development Office buildings Existing Office buildings CBD Business triangle KAROLINISK LAZDYNAI ZEMIEJI PANERIAI JUSTI 62

5 INSIDE OFFICE MARKET VILNIUS, LITHUANIA 2018 Q1 MODERN OFFICE PREMISES 87 SANTARISKES JERUZALE TURNISKES PASILAICIAI 71 NISKES FABIJONISKES SESKINĖ 73 BALTUPIAI ES VIRSULISKES 29 SNIPISKES ZVERYNAS ZIRMUNAI UZUPIS ANTAKALNIS NAUJAMIESTIS 56 SENAMIESTIS RASOS MARKUCIAI VILKPEDE 58 PAVILNYS NAUJININKAI 33 5

6 MODERN OFFICE PREMISES INSIDE OFFICE MARKET VILNIUS, LITHUANIA 2018 Q1 THE FULL SERVICE PROPERTY HOUSE IN NORTHERN EUROPE Newsec The Full Service Property House in Northern Europe is by far the largest specialised commercial property firm in Northern Europe. Newsec manages more properties and carries out more transactions, more lettings and more valuations than any other firm in Northern Europe. Through this great volume, and the knowledge and depth of our various operations, we acquire extensive and detailed knowledge of the real estate market. In turn, we can quickly identify business opportunities that create added value. Our prime market is Northern Europe, but through our alliance membership with BNP Paribas Real Estate, we offer our services on the global market. This makes Newsec Northern Europe s only full service property house, and provides us with a unique ability to forecast the future. was published in The Group expanded internationally into Finland in 2001, Norway in 2005, the Baltic countries in 2009 and Denmark in The Norwegian asset and property management companies First Newsec Asset Management and TM Partner were acquired in In 2013, Newsec acquired Jones Lang LaSalle s Swedish property management operation. In 2017, Newsec grew with the acquisitions of Norwegian Basale and Danish Datea, further strengthening the position within Property Asset Management. Newsec was founded in 1994 and is today a partner-owned company with some 2000 co-workers spread across the seven Nordic and Baltic markets. Newsec has approx. EUR 39 billion under management and annually signs lease agreements of some sqm, manages transactions of some EUR 3 billion and does real estate valuations of underlying property worth almost EUR 180 billion. Thanks to large volumes, local presence combined with in-depth understanding of a range of businesses, Newsec has a unique expertise of the real estate market in northern Europe. A history of growth Newsec is the result of a unique history of growth, characterised by constant originality of thinking. The first issue of the comprehensive market analysis, Newsec Property Outlook, TRONDHEIM TAMPERE OULU BERGEN OSLO STOCKHOLM HELSINKI TALLINN GOTHENBURG AARHUS COPENHAGEN MALMÖ KLAIPEDA RIGA VILNIUS KAUNAS 6

7 INSIDE OFFICE MARKET VILNIUS, LITHUANIA 2018 Q1 MODERN OFFICE PREMISES CONTACT AND ADDRESSES More analytical information at Newsec: Head of Research and Analysis Mindaugas Kulbokas Cell Consultant Gintaras Tolocka Cell Office solutions at Newsec: Head of Brokerage Jurgita Silaikyte Cell Tenant Consulting Head of Corporate Solutions Martynas Babilas Cell Landlord Consulting Advisor Indre Narauskaite Cell Office FIT-OUT Service Head of Project Management Tadas Grincevicius Cell LITHUANIA Konstitucijos ave. 21C LT Vilnius Phone info@newsec.lt LATVIA Vilandes str. 1 LV Riga Phone info@newsec.lv ESTONIA Roseni str. 7 EE Tallinn Phone info@newsec.ee Office Care and Property Management Head of Office Management Group Justas Bandza Cell j.bandza@newsec.lt 7

8 THE FULL SERVICE PROPERTY HOUSE IN NORTHERN EUROPE