PDF 원문

[RSQUARE] 2023_Q4 Office+Knowledge Industry Center Sales Index Report_ENG

NO.TPROPTECH RSQUARE Office - Industrial Office Complex Sales Price Index 2023 Q4 RSQUARER 1 How We Calculate Sales

Price Index

2 Office Sales Price Index 3 Industrial Office Complex Sales

Price Index

4 Office， Industrial Office Complex

Transaction Volume

5 Offiicevs﹒ Industrial Office Complex Sales Price Indices 6 Macroeconomic vs. Office Indices How We Calculate Sales Price Index Transaction * The Office Sales Price Index is based on the Case/Shiller repeat sales Index model.

have been sold more than once, to appropriately divide the growth rate OVer time﹒ 。TO compensate for the lack of other data， the index is calculated using the MIT Real Estate Research﹁s (MIT/CRE) two﹣step estimation method﹒ (=aˍ)‧ Rate « Even ifa quarterly average is used, there are limitations to stabilize Cap﹒ rate. Since there are not many trading Cases， 300 there are transaction cases Without rent information, it is tough to get a stable result. 。*Therefore Cap﹒ Rates are Calculated using the Bayesian model which recently used 10 develop indicators. ﹁he prior distribution considered in the model assumes that the difference between the previous Quarter and the current quarter is a random Walk﹒ 3 RSQUARER Office Sales Price Index In 4™ quarter of 2023, The Seoul's office Sales price index was 479.9, which is 4.80 times higher compared to the 1 quarter of 2001﹒ Index rose 1.6% from the previous quarter (23.3Q) and up 2.4% compared to the same quarter of the previous year (22.4Q). The Seoul Office Sales Index rose more than 13% annually from 2001 to the third quarter of 2008. But in the third quarter of 2009, right after the global financial crisis, index fell 12% from the peak in the third quarter of 2008. After the financial crisis, 2010 to 2017, it showed an annual increase of around 3% but from 2018 to the third quarter of 2022, it has recently fallen after showing a high annual rise of more than 10%. In 2020 and 2021, despite COVID-19, low interest rate spurred investment, pushing price higher. In 2022, although a series of interest rate hikes, index continued its upward trend based on favorable rental demand and rising rents and peaked in the third quarter of 2022. However, index has fallen in the fourth quarter of 2022, showing a stagnation. The volume of transactions decreased significantly compared to the past. But despite high interest rates, the price drop was not significant. (The index value in the fourth quarter of 2023 is 2% lower than the peak.) 一 Seoul Office Sales Price Index (2001.1Q=100.0) . 를 Quarter-on-Quarter (QoQ) 600 50% 40% 30% 20% 10% 陣 ‧ˍˍl"ˍˍˍˍ.ˍ|ˍ‧ˍˍˍl|ˍˍ|ˍˍˍˍ|ˍ‧l o 0 -20% 1040 1040 1940 1940 1040 1040 1040 1040 1940 1940 1040 1940 1040 1940 l40 104Q 04Q Q40 iQ40 1Q4Q 1Q4Q 1Q4Q 1Q4Q 01 02 ‘03 ‘04 05 g 07 08 09 0 M 2 13 4 ﹁5 6 7 8 19 20 A 22 23 -10% 4 RSQUARER Industrial Office Complex Sales Price Index In the fourth quarter of 2023, the industrial office complexs sales price Index was 216.4, Which is 2.16 times higherthan in the first quarter of 2011. In 234Q, index was up 1.9% compared to the previous quarter (23﹒3Q﹚ and down 6.7% by year-on-year (22.4Q). Unlike the office, the price index fallen sharply due to interest rate hikes. Index was steady between 2011 to 2019 at growth of 3﹒0% per year approximately and grew at a rate of more than 20% per year from 2020 to Q2 2022, which was higher that the office index. Industrial Office Complex requires less amount of capital compared to the office and has better conditions for loan term than in the housings, which led to higher price increase. The industrial office complex sales price index fell from the third quarter and fell to 15% from its peak in the third quarter of 2023, although the price increase was high until the second quarter of 2022. However, in the fourth quarter of 2023, index increased slightly. With no significant change in the inVestment environment, such as leasing and supply, rebound in index seems to be due to expectations for interest rate Cut in the future 2024, rather than the current macroeconomic environment. 一 Seoul Industrial Office Complex Sale Price Index(2011.1Q=100.0) M Quarter-on-Quarter (QoQ) 300 50% 250 40% 200 30% 150 20% 100 10% 50 I|I..I__.I__I lI˙ˍˍIˍIˍˍˍˍIˍ‧ˍ﹣ˍIˍIˍˍˍˍI|||||ˍˍˍlˉI 0% 0 -10% 4Q 3Q 1Q 3Q 1Q 3Q 1Q 30 1Q 3Q 1Q 3Q 1Q 3Q 1Q 30 1Q 30 1Q 3Q 1Q 3Q 1Q 3Q 10 30 作 12 13 14 "5 16 史 8 19 20 21 22 23 o RSQUARER Office & Industrial Office Complex Transaction Volume Seoulofficetransaction volume(including Bundang), has been steadily increasing since the global financial crisis, reaching more than KRW 10 trillion in contract year terms since 2016, with 2021 seeing the highest transaction volume of more than KRW 17 trillion. However, office yield declined due to the interest hike, which led fallin the investment volume. The volume of transactions in 2022 recorded 12 trillion won, down 34% from the previous year and 8.2 trillion won in 2023, 68% from the previous year Industrial office complex transaction volume remained at 1 trillion won since 2019 and reached 1.5 trillion won in 2021﹒ But similar to office, in the aftermath ofthe interest rate hike, transaction volume fell 10 0.9 trillion won in 2022, 60% year-on-year and further decreased in 2023, trading around 0.6 trillion won, 62% compared to 2022.

Seoul/Bundang Office Transaction volume Seoul Industrial Office Complex Transaction Volume Trillion KRW Trillion KRW 耶 Payment date M Effective date HQ 直 Q2 直 Q3 自 Q4 20 18 18 16 1.2 1.0 0.8 0.6 4 0.4 2 0.2 I 0 0.0 I 든 안 唐 員 同 同 松 同 同 員 史 合 史 1 112 13 14 15 116 17 18 '19 '20 21 22 23 6 RSQUARER Office vs. Industrial Office Complex Indices Industrial Office Complex has 1) low rents, 2) can be used as offices, and 3) located in peripheral areas such as Gasan， Guro, Magok, Songpa, Yeongdeungpo, and Seongsu rather than the three core areas where offices are concentrated. Thus, Industrial Office Complex forms a complementary market to offices. While both office and industrial office complex prices shows a similar trend, industrial office complex prices grew at a slower rate in 2019 and more rapidly from 2020 to 22.2Q compared to the office. Industrial Office Complex price growth remained stubbornly high due to the restriction on housing regulation and lower interest rate. While offices are often single-owner buildings that require large investments, Industrial Office Complex can be invested in by individual investor. It is common to split the ownership of a building and has the advantage of not being subject to housing regulations. ASa result prices rose more than 20% annually from 2020 to the second quarter of 2022, but the price drop since then has been larger than that of offices, which seems to be greatly affected by interest rates. However, expectations for a rate cut are believed to have affected the fourth quarter of 2023, as both the office and the knowledge industry center slightly increased compared to the previous quarter. 一 Seoul Office Sales Price Index — Seoul Industrial Office Complex Sales Price Index 19 3Q 1Q 3Q 1Q 30 1Q 30 1Q 3Q 1Q 3Q 1Q 30 10 30 1Q 30 1Q 30 1Q 30 10 3Q 10 30 作 12 13 14 "5 16 史 "8 8 20 21 22 23 7 RSQUARER Macroeconomics vs. Office Sales Price Index Office Sales Price Index vs. GDP, Interest Rates GDPisa measure of a country's productivity and is closely linked to office investment and rental demand. Capital investmentis based on the profits which created from production and production scale is determined in office space. If we look at the correlation between the office sales price index and GDP, sales price index and GDP both showing the upward trend. However there was a divergence during 2007, before the global financial crisis, and after 2019﹒ Inparticular in 2020 and 2021, the growth rate of the sales price index has been reaching higher than the growth rate of GDP, which we believe is due to the positive impact of low-interest rates on investment despite the stagnation of GDP due to COVID-19. From 20071 to 23﹒Q4，the correlation coefficient between interest rates and sales prices was -0.66, meaning a stronginverse relationship. But in 2022, price rose despite rising interest rates, weighing heavily on investment. Similar trend has been seen before the global financial crisis. ㅡ Seoul Office Sales Price Index ﹍ 一 Nominal GDP 5-year National Treasury Bonds 600 10% Interest rate, Sales price index increased 9% 8% 7% 6% 300 5% 4% 3% 2% 1% 0 0% 1030 1030 1030 1030 10309 1030 1930 1030 1030 1030 1030 1930 1030 1030 1030 1030 1030 1030 1030 1030 1030 1030 1030 01 02 ‘03 ‘04 05 g 7 08 09 0 M 2 13 4 ﹁5 6 7 8 19 0 A 2 23 8 RSQUARERA Macroeconomic vs. Office Sales Price Index Office Index vs Nominal Cap. Rate The cap. rate, which represents the relationship between the sale price and rent, shows an inverse correlation. Cap﹒ Rate fell 8.0%p from 12.8% in the first quarter of 2001 to 4.8% in the fourth quarter of 2023, while the sale price rose 380% from 100.01in the first quarter of 2001 to 479.9 in the second quarter of 2023, indicating that Cap. Rate fell 0.21%p when the sale price rose 10%. Cap. rates have been declining steadily, but interest rate hike in 2022 led stagnation in price, 35 a reSult cap rate increased. (22.4Q: 4.0% - '23.4Q: 4.8%) Higher interest rates have stalled transaction prices and uptrend in rent continue as the rental market remains n good shape, which is likely to push Cap. Rate higher for the time being. In addition, while cap. rates have ranged from 250 to 300 bps over the long term from 2010 to recent years，the Spreadin 234Q was around 100 bps suggesting that cap rates will rise further unless interest rates fall. 一 Nominal Cap. Rate(Seoul) ﹣ 一 Seoul Office Sales Price Index 600 15% 500 13% 400 11% 300 9% 200 7% 100 5% 0 3% 1930 1930 1030 1930 1030 1030 1030 1030 1030 1930 1030 1030 1030 1030 1030 1930 1030 1030 1030 1030 1930 1030 1030 01 02 ‘03 ‘04 05 g 7 08 09 0 M 2 13 4 ﹁5 6 7 8 19 0 A 2 23 9 RSQUARER Research Center Kangmin Ryu Director locsword@rsquare.co.kr Hyejin Jung Senior Manager hyejin@rsquare.co.kr Taejin Ahn Associate Manager stevenBko@rsquare.co.kr Kyujung Choi Associate Manager kyu.choi@rsquare.co.kr RSQUARE Anam Tower, 311 Taeheran-ro Gangnam﹣gu Seoul

Real Estate Services

info@rsquare.co.kr Lease & Occupy sales@rsquare.co.kr

Interior Design

rd_info@rsquare.co.kr A/S rd_as@rsquare.co.kr 1551-5678