BREAKING NEW GROUND Opportunities amidst the rapid growth of flexible workspace and emergence of flexible leasing strategies in Singapore

COLLIERS RADAR OFFICE SINGAPORE 11 SEPTEMBER 2018 Primary Author: JM Tan Senior Analyst Research +65 6531 8533 jm.tan@colliers.com For further information: Tricia Song Director and Head Research Singapore +65 6531 8536 tricia.song@colliers.com Duncan White Executive Director and Head Office Services Singapore +65 6531 8684 duncan.white@colliers.com Jonathan Wright Director Flexible Workspace Services Asia +852 2822 0577 jonathan.wright@colliers.com Tang Wei Leng Managing Director Singapore +65 6531 8688 weileng.tang@colliers.com BREAKING NEW GROUND Opportunities amidst the rapid growth of flexible workspace and emergence of flexible leasing strategies in Singapore

Summary & Recommendations Flexible workspace stock in Singapore nearly tripled since 2015, with 2017 recording the steepest annual growth on record (+44% YOY). The sector looks to be firmly on track for another 30% growth in total stock over 2018, given operators aggressive expansion plans. > We see an opportunity for occupiers to consider flexible leasing strategies, especially against the backdrop of landlord-favourable conditions in Singapore s office market. Occupiers should exploit the current supply overhang and competitive landscape to secure attractive commercial terms from operators. > We advise landlords and developers to review and reposition their assets given evolving real estate requirements, and demand for flexibility amongst occupiers. > Landlords should also engage with the existing and potential tenant mix to anticipate any product/amenity gap that can be effectively addressed via a suitable partnership with an external operator, or selfadministered flexible workspace. 30% Expected YOY growth of total flexible workspace stock in Singapore over 2018 12-24 months Average lease tenure of flexible workspace memberships in Singapore SGD390 600 Average pricing* for a hot-desk in flexible workspace centres across Singapore SGD700 900 Average pricing* for a dedicated desk in flexible workspace centres within the CBD *Based on 129 flexible workspace centres with published rates (non-subsidized). Average pricing refers to the interquartile range (between the 25th and 75th percentiles). Denoted in Singapore Dollar (SGD) per month.. USD1 = SGD1.368 as of 31 August 2018 Examining the Implications for the Singapore Office Market As of H1 2018, the flexible workspace industry is already one of the top five occupier sectors in the CBD Premium and Grade A office market. We are positive on the growth of the industry, and view the increasing adoption of a flex office component amongst businesses as a crucial catalyst for sustainable, long-term growth. This is evidenced by a growing number of multinational corporations inking flexible workspace membership deals to constitute a flex office component, which complements the traditional core leased office space. For the Singapore Grade A office market, flexible workspace growth should loosely support annual net absorption over 2018-2022, underpinned by the sector s generous square footage allocated to ancillary/amenity spaces, and the ability to channel new occupier-types that were previously unable to lease prime office space viably without a pooled membership model. As for flexible workspace operators, the rapid growth of the industry will also likely see greater competition and further consolidation activity. Furthermore, we have observed some market saturation in the low- to mid-tier brackets, which will place pressure on flexible workspace occupancy levels and desk prices. We study the sector in greater detail within this report. JM Tan Senior Analyst Research Singapore 2

TABLE OF CONTENTS Page Page STILL FAST: STRONG MOMENTUM INTO 2018 4 Total flexible workspace footprint in Singapore nearly tripled since 2015 4 Flexible workspace now ranked among top five occupier sectors in CBD prime office market 6 Orchard Road gaining interest, retail-to-flexible workspace conversions picking up 7 Focus shifting to smaller buildings given tight availability in Grade A market 8 STILL FURIOUS: COMPETITION HEATS UP ON SUPPLY 10 Flexible workspace supply poses a challenge to under-performing operators 10 Top seven players control more than 60% of Singapore flexible workspace market 10 Small- to mid-sized operators facing saturation, further consolidation expected 11 Flexible workspace attractively priced amidst rising office rents in Singapore 12 KEY RECOMMENDATIONS 13 3

STILL FAST: STRONG MOMENTUM INTO 2018 Total flexible workspace footprint in Singapore nearly tripled since 2015 2017 was a whirlwind year for the flexible workspace sector, which grew 44% YOY in terms of total real estate footprint across Singapore, marking the fastest annual growth in the sector s history. This encompasses coworking spaces and serviced offices. According to Colliers International's research, flexible workspace now occupy approximately 2.7 million sq ft (251,000 sq m) across Singapore, nearly tripling from about 1 million sq ft (90,000 sq m) at the end of 2015 (Fig. 1). Fig. 2. Selected Flexible Workspaces Transactions in H1 2018 Flexible Workspace Operator Location Estimated Size (sq ft) Campfire 139 Cecil Street 85,000 WeWork 8 Cross Street 60,000 Spaces Paya Lebar Quarter Tower 1 52,000 Spaces TripleOne Somerset 35,000 WeWork 22 Cross Street 29,000 Regus Vision Exchange 26,000 Fig. 1: Total Stock, Supply and YOY Growth of Flexible Workspace NLA ( 000 sq ft) 4,000 3,000 2,000 1,000 0 31% 44% 30% 2016 2017 2018F 2019F YOY Growth (%) 20% Forecast Supply Net Supply (YTD for 2018) Cumulative Stock YOY Growth (%) Growth was driven by the entry of operators from overseas markets, while being supplemented by the expansion plans of incumbent operators looking to establish new locations (Fig. 2). Following 2017's rapid expansion, we expect total flexible workspace footprint to grow between 30% to 35% YOY for full-year 2018, or approximately 670,000 sq ft (62,000 sq m). This should closely match 2017's record-breaking net expansion of 680,000 sq ft (63,000 sq m) in total flexible workspace stock. 60% 40% 20% 0% Found 100 Amoy Street 22,000 JustCo Macdonald House 16,000 The Work Project Parkview Square 15,000 4

we expect the flexible workspace footprint to grow in non-core CBD locations, and decentralized submarkets. A significant majority of the Singapore market's total flexible workspace footprint (84%) is located within the Central Business District (CBD) (Fig. 3). As of 30 June 2018, the CBD hosts some 2.3 million sq ft (211,000 sq m) of flexible workspace, versus 2.7 million sq ft (251,000 sq m) island-wide. In terms of growth, the sector's total CBD footprint has more than doubled since 2015, from 969,000 sq ft (90,000 sq m) to 2.3 million sq ft (211,000 sq m) (Fig. 4). This translates to a growth rate in the CBD averaging 1% of stock per annum. More recently, flexible workspaces have taken space in the fringe areas of the CBD in addition to the initial core clusters around Raffles Place (Fig. 4). This provides a wider range of choice and cost-alignment for potential flexible workspace occupiers. Looking ahead, we expect the flexible workspace footprint to grow in non-core CBD locations, and decentralized submarkets. For instance, four flexible workspace deals were closed in the Orchard Road micro-market during the first six months of 2018, as discussed in the next sections. Fig. 4: Flexible Workspace Density* and Stock in Singapore Core CBD (2015 vs. H1 2018) Fig. 3: Distribution of Flexible Workspace Stock Suburban, 7% City Fringe, 9% 2.7 million sq ft (NLA) CBD, 84% 2015 969,000 sq ft H1 2018 2,274,000 sq ft *Density refers to total flexible workspace (net lettable area; sq ft) per address, which may include more than one operator in some buildings. 5

Fig. 5: Top 5 Occupier Sectors in the CBD Premium and Grade A Office Market (H1 2018) Top 5 Occupier Sectors (by % share of CBD Premium & Grade A office stock) Financial Services 45% 10% 6% 13% Professional Services Energy & Shipping Tech 5% Flexible Workspace Flexible workspace will constitute a growing proportion of office stock as more corporations take up a flex component as part of their commercial leasing strategy. Flexible workspace now ranked among top five occupier sectors in CBD prime office market As of 30 June 2018, flexible workspace operators occupy 4.5% (Fig. 5) of CBD Premium and Grade A office stock, placing it among the top five occupier sectors in Singapore s prime office market. The other major occupier sectors are: financial services (45%), professional services (13%), energy and shipping (10%), as well as the technology sector (6%). In our view, these market share ratios are likely to rebalance gradually as adoption of new flexible leasing models - Flex and Core TM and City Campus - will gradually proliferate to a wider crosssection of the occupier market (refer to our 2018 APAC Flexible Workspace Outlook report for more details on new flexible leasing models). Flexible workspace will constitute a growing proportion of office stock as more corporations take up a flex component as part of their commercial leasing strategy. Notably, the banking and financial services sector is an early adopter of flexible leasing strategies, despite initial concerns around privacy and security. HSBC and Standard Chartered are both examples of multinational banks that have taken up large desk counts in flexible workspaces across Asia Pacific. Another interesting adopter is the insurance industry, where a large proportion of employees may be in the sales agency function an inherently mobile occupation well-suited for using flexible workspaces as drop-down spaces across the city. As for the technology sector, the ready availability and expansion of flexible workspace operators is well-matched with tech companies high growth momentum and their need for rapid headcount scalability. Overall, we view the increasingly widespread adoption of a flex office component amongst businesses as a key catalyst for sustainable, longterm growth of the flexible workspace industry. This is evidenced by a rapidly growing number of multinational corporations inking flexible workspace membership deals. For the Singapore Grade A office market, the growth of flexible workspace should loosely support annual net absorption over 2018-2022, underpinned by the sector s generous square footage allocated to ancillary / amenity spaces, and the ability to channel new occupier-types that were previously unable to lease prime office space viably without a pooled membership model. 6

Orchard Road gaining interest, retail-to-flexible workspace conversions picking up We expect retail-to-flexible workspace conversions to pick up pace in the years ahead. This comes on the back of a few notable deals in recent quarters, such as Spaces (a subsidiary of IWG) taking up 35,000 sq ft (3,300 sq m) at One Raffles Place Shopping Mall in March 2018, and JustCo leasing 57,000 sq ft (5,300 sq m) of retail space at Marina Square in late 2017. This is likely an adaptation to the tough retail leasing climate in Singapore. Based on latest data from the Urban Redevelopment Authority (URA), Singapore s retail vacancy currently stands at 7.3% as of Q2 2018, with approximately 4.8 million sq ft (448,000 sq m) of vacant floor area in shopping centres and retail podiums islandwide. Meanwhile, Central Region retail rents have chalked up a long-running decline over the past 13 quarters, as of Q2 2018. These factors may have prompted landlords to explore leasing to flexible workspace operators, in a bid to achieve more stabilized occupancy for their retail properties. This is in spite of the trade-off being lower gross rental income, as office rents are typically lower than retail rents. Fig. 6: Flexible Workspace Distribution in the Singapore CBD (by Transaction Year) Orchard Road Shenton Way / Tanjong Pagar Beach Road Raffles Place / New Downtown City Hall Legend 2016 & earlier 2017 2018 YTD Simultaneously, there appears to be heightened interest amongst flexible workspace operators in expanding within the Orchard Road micromarket, which is also Singapore's premier shopping district. Four new flexible workspace leases were transacted along Orchard Road over the first six months of 2018 (Fig. 6). These include 15,000 sq ft (1,400 sq m) by The Great Room at Ngee Ann City Tower B, JustCo leasing some 16,000 sq ft (1,500 sq m) at Macdonald House, and Spaces' new location spanning 35,000 sq ft (3,300 sq m) at TripleOne Somerset. New-to-market flexible workspace player, CoCRE8, leased about 4,000 sq ft (370 sq m) of office space at the International Building. All the above deals marked each respective operator s first foray into the Orchard Road micro-market., Google Maps 7

Based on Colliers International's research, the flexible workspace footprint in Orchard Road currently comprises approximately 8% of the island-wide total (Fig. 7) by square footage. However, the highest concentration of flexible workspace remains in the Raffles Place / New Downtown and Shenton Way / Tanjong Pagar micromarkets (Fig. 7), which host 41% and 29% of Singapore's total flexible workspace footprint respectively. New flexible workspace lettings over 2017-2018 YTD have largely continued in the same vein, being highly concentrated in these two core CBD micromarkets as denoted in Fig. 6. Looking ahead, we anticipate the growth rate in Orchard Road and Beach Road to be slightly higher than the rest of the CBD, as operators ramp up their presence there from a relatively lower base. Fig. 7: CBD Flexible Workspace Distribution (by Square Footage) Fig. 8: CBD Flexible Workspace Lettings (by Building Grade) Proportion (by NLA) 100% 80% 60% 40% 20% 0% 33% 48% 63% 67% 52% 37% 2016 2017 H1 2018 Premium & Grade A Grade B & below Focus shifting to smaller buildings given tight availability in Grade A market Delving into the leases signed by flexible workspace operators over 2016 to H1 2018, we observe a steep decline in the proportion of deals transacted in Premium and Grade A properties, as compared to Grade B and other office properties. Flexible workspace lettings within CBD Premium and Grade A buildings made up 63% of all deals in 2016, by square footage (Fig. 8). However, this fell sharply to just 33% of all deals in 2018, reflecting the tight availability of suitable floor plates in the CBD Premium and Grade A market at present. Over 2018-2019, flexible workspace operators will likely increasingly target Grade B office properties as well as retail spaces, given the tight vacancy rate (5.5% as of Q2 2018) in the CBD Premium & Grade A office market. In addition, a number of Grade A buildings already have operators in situ that have secured exclusivity clauses. 8

Summary of Flexible Workspaces in New Grade A Office Completions over 2018 The race among operators to stake their presence has extended towards upcoming commercial developments as well. Most of the Premium and Grade A office supply due for completion over 2018-2020 already have a flexible workspace component secured, whether managed via a third-party operator, or on the developer's own initiative. Frasers Tower Q2 2018 Paya Lebar Quarter Q3 2018 In Q2 2018, The Executive Centre launched a 21,000 sq ft (1,950 sq m) new centre in the newly completed Frasers Tower, a 663,000 sq ft (61,600 sq m) Grade A office building located in the Tanjong Pagar precinct. This marks the upmarket flexible workspace operator s sixth location in Singapore. 18 Robinson Q3 2018 18 Robinson, a new build in Raffles Place due to complete in Q3 2018, has signed IWG-subsidiary Spaces as an anchor tenant occupying four floors, or 32,000 sq ft (3,000 sq m). This comprises approximately one quarter of the 136,000 sq ft (12,600 sq m) development's leasable floor area. Paya Lebar Quarter is an example of a development where the landlord engineers a blend of third-party flexible workspace operator and owner-initiated brand within the same project. The City Fringe Grade A mixed development with 880,000 sq ft (81,800 sq m) of office space, will have Spaces operating a 52,000 sq ft (4,800 sq m) center at Tower 1, whilst Lendlease pilots its co-located proprietary flexible workspace brand. 9

STILL FURIOUS: COMPETITION HEATS UP ON SUPPLY Flexible workspace supply poses a challenge to under-performing operators We have observed a stark differential between top-tier and underperforming operators in the flexible workspace sector, with some traditional serviced office providers facing occupancy challenges amidst the influx of new operators. In parallel, the volume of closures and distressed acquisitions have accelerated over the past 18 months. Based on Colliers International's research, space utilization rates within flexible workspaces vary widely, with an average daily utilization rate of 25% on the low end in under-performing centres, to above 90% utilization in the more popular locations. We also observe generous offerings of sign-on membership incentives escalating rapidly in this competitive climate. Incentives may range from one month's rent-free, up to six months' rent-free for a typical 12- to 24-month flexible workspace membership tenure. In parallel, free trial offerings may run from a typical day pass, up to an entire month's free usage. Additionally, flexible workspace operators have sought to diversify their revenue streams. For instance, event spaces may be available for lease, whether during working hours or off-peak periods, which enable additional monetization of the available space that has been fitted out to premium standards. Increasingly, operators have begun partnering with on-site food and beverage (F&B) or wellness providers, offering low base rents in return for a share of profits with gross turnover rent (GTO) structures. This allows the operator to capture the discretionary spending of workspace users, and fully aligns the business goals of the operator with the third-party vendor. Top seven players control more than 60% of Singapore flexible workspace market Based on Colliers International's research, the top flexible workspace players by square footage in Singapore are namely: IWG (which includes the Spaces and Regus brands), WeWork, JustGroup (parent entity of JustCo and JustOffice), The Executive Centre, Servcorp, Campfire, and The Great Room. Fig. 9. Top Flexible Workspace Operators in Singapore (by Size) Flexible Workspace Operator Estimated Portfolio Size (sq ft) Market Share (%) IWG 650,000 23.5% WeWork 344,000 12.5% JustGroup 331,000 12.0% The Executive Centre 153,000 5.6% Servcorp 102,000 3.7% Campfire 85,000 3.1% The Great Room 76,000 2.8% Top players 63.1% The top seven players currently hold close to two-thirds (63%) of the total flexible workspace market (Fig. 9) by square footage, as of 30 June 2018. The remaining share (37%) of the overall market is shared amongst more than 110 other operators. Notwithstanding, we expect market dynamics to continue rebalancing, given the inflows of new-to-market players such as Campfire, Distrii and Ucommune, and the possible expansion and/or consolidation of small- to mid-sized operators. 10

Small- to mid-sized operators facing saturation, further consolidation expected The most saturated market segment currently appears to be single-location operators managing spaces below 2,000 sq ft (186 sq m), which coincidentally corresponds with the median size of flexible workspace centres shuttered since the industry's inception in Singapore. The rapid supply growth of small-sized, single-space flexible workspace operators may have outpaced underlying market demand, which mainly stems from small-sized businesses or freelancers. We expect this to place pressure on flexible workspace occupancy levels and desk prices In our view, larger players with sizable footprints of more than 50 desks per location, and a multi-location portfolio, are better equipped to cater for the next lap of growth from corporations seeking a flexible leasing strategy. The flexible workspace requirement from multinational corporations typically span hundreds of desks within a single market (e.g. Singapore). Fig. 10: Average Size of Flexible Workspace Lettings 11,780 2015 2016 2017 2018 YTD 21,620 23,648 Average Size (sq ft) 26,579 Moreover, scaling up also enables operators to better leverage economies of scale from technological investments or capital expenditures (e.g. bulk purchases of furniture). Based on Colliers International's research, the average location size leased by flexible workspace operators in Singapore has indeed been trending upwards each year since 2015 (Fig. 10). Flexible workspace leases in 2015 averaged approximately 11,800 sq ft (1,100 sq m). This grew to about 26,600 sq ft (2,500 sq m) in 2018 YTD, more than double that of the average size transacted during 2015. We expect further consolidation in Singapore s flexible workspace sector, with mergers and acquisitions ramping up over 2018-2020. August 2017 saw the acquisition of Singapore-based coworking start-up SpaceMob by the US-based global flexible workspace chain WeWork 1. Within less than a year, WeWork went on to acquire Shanghai-based naked Hub in April 2018 for a sum of USD400 million (SGD500 million) 2, shortly after the anticipated JustCo and naked Hub partnership fell through in January 2018 3. A SGD237 million (USD177 million) joint coworking platform between Frasers Property, GIC and JustCo was also announced in May 2018 4. We anticipate that larger operators will look to supplement their organic growth with acquisitions of smaller players, or those with a niche offering that can either complement or diversify their existing offering. We may also see some mergers of small- and mid-sized operators to create scale. Nevertheless, we observe that single-space providers perform well when they can cultivate a strong competitive proposition, with a specific focus and genuine added value for the entrepreneurial community in Singapore. Furthermore, a healthy level of competition within the sector is a definite positive for occupiers, as well as the sustainable growth of the flexible workspace sector. 11 1 Lee, Y. and Ramli, D. (2017) "WeWork to Pump $500 Million Into Southeast Asia, South Korea". Bloomberg, August 2017. 2 Huet, E. and Chen, L.Y. (2018) "WeWork Is Acquiring China s Naked Hub for $400 Million". Bloomberg, April 2018. 3 Goh, B. (2018) "China-based co-working operator naked Hub eyes 200 locations by 2020". Reuters, January 2018. 4 Mui, R. (2018) "Frasers Property, GIC, JustCo invest US$177m to develop co-working space platform across Asia". Business Times, May 2018.

Flexible workspaces attractively priced amidst rising office rents in Singapore Based on Colliers International's research, the typical price of a flexible hotdesk membership in Singapore is around SGD390 to SGD600 (USD285 to USD439) per month (Fig. 12), using the interquartile range of published desk rates as a gauge. This figure excludes subsidized rates, such as for incubator spaces. For users that require an dedicated desk within the CBD, the typical pricing ranges from SGD700 to SGD900 (USD512 to USD658) per month. This implies an average lease rate of about SGD7.00 to SGD9.00 (USD5.12 to USD6.58) psf pm, assuming 100 sq ft of office space per desk. We view flexible workspace as attractively priced, given that average CBD Premium and Grade A gross effective rents stood at SGD8.82 (USD6.45) psf pm in Q2 2018, and set to rise further. Desk rates are fairly consistent across CBD micro-markets (Fig. 11), with the median desk rental ranging from SGD750 (USD548) in the least costly districts, to SGD800 (USD585) in the priciest micro-market, Raffles Place / New Downtown. It is important to note that a flexible workspace membership is an "all-in" figure. Users do not have to worry about capital expenditures (e.g. fit-out costs, furnishings, IT installations) typically associated with traditional office leases. Moreover, the Singapore office market is currently on a multi-year upcycle after bottoming out in mid-2017. We expect CBD Premium and Grade A rents to rebound rapidly, rising up to 20% over 2017 rates by end-2019. Fig. 11: Average Pricing Range of Dedicated Desks in the CBD SGD per month $1,300 $1,100 $900 $700 $500 CBD $750 $800 Raffles Place/ New Downtown Interquartile Range Shenton Way/ Tanjong Pagar Median $750 $750 $760 $775 City Hall Orchard Road Beach Road Against the backdrop of rising office rents and uncertain global economic conditions, occupiers may opt to keep their real estate portfolio as lean as possible with new flexible real estate strategies. Flexible real estate strategies offer the twin benefits of shorter-term lease tenures, coupled with scalability to cater to fluctuating headcount without committing to excess office space that may be under-utilized. Colliers's 2018 APAC Flexible Workspace Outlook found that occupiers appreciate the flexibility of directly correlating headcount to real estate costs, and moving away from long-term, fixed contracts, via flexible leasing strategies such as the Colliers-led Flex and Core TM or City Campus models. SGD390 600 Average pricing* for a hot-desk in flexible workspace centres across Singapore Fig. 12: Average Pricing Range* for Flexible Workspace across Singapore and within the CBD SGD425 650 Average pricing* for a hot-desk in flexible workspace centres within the CBD SGD700 900 Average pricing* for a dedicated desk in flexible workspace centres within the CBD 12 *Based on 129 flexible workspace centres with published rates (non-subsidized). Average pricing refers to the interquartile range (between the 25th and 75th percentiles). Denoted in Singapore Dollar (SGD) per month.

KEY RECOMMENDATIONS For Occupiers The current rapid growth phase of the flexible workspace sector presents an attractive opportunity for prospective users. Portfolio Strategy: > Consider the viability of alternative flexible leasing strategies, which combine traditional office leases with short-term lease tenures in flexible workspace centres. Benefits include: an opportunity to move away from long-term, fixed contracts, and the employee engagement upside associated with a community-focused, creative environment (refer to Colliers International's 2018 APAC Flexible Workspace Outlook report for more details on new flexible leasing models) > Keep an inventory of short-term options in anticipation of fluctuating headcount or abrupt expansionary requirements. Flexible workspace allow businesses to adjust headcount quickly and directly to real estate costs, for short commitment periods (between 6 and 24 months) Negotiation and Selection: > Understand the unique amenity profile, pricing and positioning of each flexible workspace and the corresponding operator. This is key to optimal alignment of the real estate portfolio with strategic and tactical needs > Exploit the abundance of flexible workspace supply, particularly the highly competitive small to mid-sized operator market segment, when negotiating the best terms for a commercial real estate portfolio > Anticipate the effect of membership fee escalations given the relatively short membership tenures. For instance, agreements may specify fee escalations every 12-24 months upon renewal, which may compound very quickly For Landlords & Developers For commercial developments, flexible workspaces have evolved from a nice to have option to a strategic essential, due to evolving occupier requirements. We recommend that landlords and developers proactively incorporate real estate approaches which best capture occupiers' rising interest in flexible leasing models, whether managed via a third-party operator or a proprietary initiative. Partnering Flexible Workspace Operators: > Consider partnering with a flexible workspace operator that complements each individual asset, as well as the overall portfolio > Structure commercial lease terms suiting a preferred partnership approach, and which reflect the interests of all parties involved. For example, gross turnover rent structures are increasingly being considered in this market, while exclusivity clauses that primarily benefit operators are losing favour Engaging Occupiers: > Engage with existing and potential tenants to anticipate any product/amenity gap that can be effectively addressed via a suitable partnership with an external operator, or self-administered flexible workspace > Understand the multitude of potential roles and depth that a flexible workspace can bring to the portfolio. Flexible workspace may act as auxiliary amenities for the tenant mix within the building, enhance the usable space value and overall appeal, or act as incubators or 'swing spaces' for start-up / new-to-market companies that may not have adequate scale to secure a viable office lease 13

Primary Author: JM Tan Senior Analyst Research Singapore +65 6531 8533 jm.tan@colliers.com Contributors: James Ong Executive Office Services Singapore +65 6531 8668 james.ong@colliers.com Kevin Soo Director Office Services Singapore Landlord Representative +65 6531 8671 kevin.soo@colliers.com For further information, please contact: Tricia Song Director and Head Research Singapore +65 6531 8536 tricia.song@colliers.com Duncan White Executive Director and Head Office Services Singapore +65 6531 8684 duncan.white@colliers.com Jonathan Wright Director Flexible Workspace Services Asia +852 2822 0577 jonathan.wright@colliers.com Tang Wei Leng Managing Director Singapore +65 6531 8688 weileng.tang@colliers.com About Colliers International Group Inc. Colliers International Group Inc. (NASDAQ: CIGI) (TSX: CIGI) is a top tier global real estate services and investment management company operating in 69 countries with a workforce of more than 12,000 professionals. Colliers is the fastest-growing publicly listed global real estate services and investment management company, with 2017 corporate revenues of $2.3 billion ($2.7 billion including affiliates). With an enterprising culture and significant employee ownership and control, Colliers professionals provide a full range of services to real estate occupiers, owners and investors worldwide, and through its investment management services platform, has more than $20 billion of assets under management from the world s most respected institutional real estate investors. Colliers professionals think differently, share great ideas and offer thoughtful and innovative advice to accelerate the success of its clients. Colliers has been ranked among the top 100 global outsourcing firms by the International Association of Outsourcing Professionals for 13 consecutive years, more than any other real estate services firm. Colliers is ranked the number one property manager in the world by Commercial Property Executive for two years in a row. Colliers is led by an experienced leadership team with significant equity ownership and a proven record of delivering more than 20% annualized returns for shareholders, over more than 20 years. For the latest news from Colliers, visit our website or follow us on