3.2% 2.1% 7.5% Inflation Forecast 2018 y-o-y, SK. Private Consumption Forecast 2018 y-o-y, SK

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1 City Report 218

2 3.2% 2.1% 7.5% Forecasted GDP Growth 218, SK Inflation Forecast 218 y-o-y, SK Unemployment rate February 218, SK 12,13 3.1% 4.5% Purchasing power, 216, Bratislava Private Consumption Forecast 218 y-o-y, SK Industrial production, Forecast 218 y-o-y, SK Economy Highlights GDP rose.9% in Q4 217, in line with the growth rate seen in the previous four quarters, and benefiting from the robust momentum in both the global and Eurozone economies in H In 218 as a whole, we see the economy expanding by 3.2%, after 3.4% in 217 Private consumption remained strong throughout the whole of 217. Meanwhile, investment and net external trade also provided positive contributions to growth in 217, but both were very volatile, with exports being particularly strong at the end of last year Inflation returned in 217 after three years of mild deflation and was up to 2.3% in. Oxford Economics expect inflation to stay around 2% throughout 218 On a structural basis, the labour market may now be approaching full employment, but the short-term dynamics remain positive for household incomes and spending with the unemployment rate continuing to move down towards new lows (at 7.5% in February), while real wages are forecast to increase by a solid 2.5-3% Source: Oxford Economics Bratislava City Report 218

3 Prime Yields 5.5% 6.5% 7.15% Shopping Centre Office Industrial Slovakia investment volumes Millions 9 1 year average 3 year moving average F 218 investment volumes is expected to reach 6 millions Investment transactions by sector 1% 8% 6% 4% 2% % Retail Office Mixed Land Industrial Hotel Bratislava City Report 218

4 A & B Class Stock & Vacancy development Thousands sqm 1,8 1,7 1,6 1,5 1,4 1,3 1,2 1,1 1, 16% 14% 12% 1% 6% 4% 2% % Occupied Stock Vacant Stock % Vacancy (right axis) Stock & Vacancy at Q Thousands sqm BA I BA II BA III BA IV BA V 1% 9% 7% 6% 5% 4% 3% 2% 1% % In, Bratislava s A and B class office stock amounted to 1.72 million sqm, of which 59% is represented by A class and 41% by B class No new projects were completed or commenced in 218, however there is there currently more than 29, sqm of new A class office space under construction By the end of this year, we expect a further 116, sqm of new office space to be completed The overall vacancy rate in Bratislava has decreased to its historical minimum of 5.99% from 6.17% in the previous quarter Occupied Stock Vacant Stock Vacancy Rate (right axis) Bratislava City Report 218

5 Gross Take-up by type of tenant Sqm 1, 8, 6, 4, 2, Count Size of Deal Number of Deals Under Construction by city district and completion Y-o-Y Net absorption Thousands sqm BA I BA II BA III BA IV BA V Thousands sqm Bratislava City Report 218

6 Shopping centre density by regions (sqm / 1, inhabitants) Regional average: 231 m 2 / 1, inhabitants Banská Bystrica Bratislava Košice Nitra Prešov Trenčín Trnava Žilina Shopping Centre Density Prime rents ( /sqm/month) Shopping centres Retail Parks High street *Prime rents relate to a well located 1 sqm unit shop from the fashion and accessories category in leading retail assets in capital city (for retail parks 2, sqm units). Bratislava City Report 218

7 Retail Stock & Density distribution in Slovakia by Regions 36% 11% 13% 6% 11% *Shopping centres, Retail parks, Retail Galleries, Factory Outlets Retail Type Retail area (sqm) Share on area Share on count of retail units Shopping Centre 1,259, % 4 Retail Park 351, % 3 Department Store 44, % 5% Retail Gallery 43, % 7% Factory Outlet 15,.9% 1% Concept Store 9,199.5% 2% Total 1,723,384 1% 1% Bratislava City Report 218

8 Slovakia Stock Distribution (sqm) Thousands sqm 1,4 1,2 1, Central Slovakia Eastern Slovakia Greater Bratislava Western Slovakia Total Area New Area Under Construction Vacancy 7% 6% 5% 4% 3% 2% 1% % Vacancy Rate in Slovakia: 4.6% Demand in 218 Net take-up (sqm) Renewals (sqm) 3.3% 6.7% 5.5% 4.5% 4% 6% Bratislava City Report 218

9 Under Construction by Regions Central Slovakia Under Construction overall (sqm) Greater Bratislava 31% Western Slovakia 61% 188, Rental conditions Location Bratislava Prime locations Greater Bratislava Western Slovakia Central Slovakia Eastern Slovakia Prime rent from Prime rent to Slovakia: Vacancy development 14% 12% 1% 6% 4% 2% % Bratislava City Report 218

10 Contacts Ján Bošácky Head of Research Dalibor Surový Head of Office Agency Oskar Bittner Retail Agency Samuel Šporka Head of Industrial Agency Jones Lang LaSalle IP, Inc. All rights reserved. No part of this publication may be reproduced or transmitted in any form or by any means without prior written consent of Jones Lang LaSalle. It is based on material that we believe to be reliable. Whilst every effort has been made to ensure its accuracy, we cannot offer any warranty that it contains no factual errors. We would like to be told of any such errors in order to correct them.