Russia Investment Briefing

05 October 2015 15.15 – 16.00

Russia Investment Briefing

WelcomePropertyEU, our expert speakers and

Our hosts Moscow City

Russian Real Estate Investment Market

The prospects for economic growth

4

Experts forecast 1-2 years of recession

Source: Colliers International, Ministry of Economic Development of Russia, IMF, Bloomberg, Rosstat, Sberbank CIB, Morgan Stanley

Real GDP growth, % Ruble was not the only currency that came under pressure

(change in exchange rates during 24.09.2014-24.09.2015)

Brazilian realRussian rouble

Belarussian roubleUkranian hryvnia

Kazakh tengeTurkish lira

Norwegian croneMaxican peso

South African randIndonesian rupiah

Canadian dollarPolish zloty

Hungarian forintEuro

-50% -40% -30% -20% -10% 0%

-43%-43%

-40%-40%

-33%-27%

-24%-23%

-20%-19%

-17%-13%-13%-12%

2006

2007

2008

2009

2010

2011

2012

2013

2014

2015

F20

16F

2017

F-10.0

-8.0

-6.0

-4.0

-2.0

0.0

2.0

4.0

6.0

8.0

10.08.2 8.5

5.2

-7.8

4.5 4.33.4

1.30.6

-2.5

3.1 2.7

GDP growth, %Ministry of Economic Development, basic forecastMinistry of Economic Development, moderately positive forecastIMFSberbank CIBMorgan Stanley

Basic forecast of Ministry of Economic Development of Russsia assumes that Urals oil

price stabilizes at USD 65 per barrel in 2016-2017, while the exchange rate stabilizes at 55 RUB/USD.

Q1 2

013

Q3 2

013

Q1 2

014

Q3 2

014

Q1 2

015

Q3 201

5

Q1 201

6

Q3 201

6

Q1 201

7

Q3 201

7

7% 6%8%

10%

17%

15%

15.8%

11.9%

7.3% 6.3%

CPI growth, year-on-year, and MinEconom forecast

Real estate investment volumes

5

The investment market size declined more than two times

2007 2008 2009 2010 2011 2012 2013 2014 2015F

2.8

4.6

2.02.9

6.05.2 4.9

2.6 2.2

3.9

5.0

3.2

4.9

8.5 8.88.2

3.63.0

Investment volume in Q1-Q3 Investment volume in Q4 Investment volumes for the full year

in USD bn

Source: Colliers International

Capital originRussians, with 72% share, are dominating on the investment market now

5

2007 2008 2009 2010 2011 2012 2013 2014 Q1-Q3 2015

1,070.9 1,604.72,433.6

3,915.14,969.3

7,240.5

4,960.7

2,642.41,599.5

2,846.1

3,454.2808.9

984.0

3,529.6

1,531.3

3,195.0

928.6

611.3

Russia Foreign

in USD bn

Source: Colliers International

Capital originRussians, with 72% share, are dominating on the investment market now

5 Source: Colliers International

2007 2008 2009 2010 2011 2012 2013 2014 Q1-Q3 2015

Russia Austria China Finland Germany UK USA Other

Investor types

8

Financial and real estate companies are dominating on the market

2007 2008 2009 2010 2011 2012 2013 2014 Q1-Q3 2015

0%

20%

40%

60%

80%

100%

26%

34%

35%

Hotel Owner or OperatorConfidentialNon-real estate companiesDevelopers and property companiesFinancial companies/institutions and funds/REIT

Source: Colliers International

Investment purpose

9

The share of purchases by end-users has increased, similar to 2009

Source: Colliers International

2007 2008 2009 2010 2011 2012 2013 2014 Q1-Q3 2015

32%

58%69%

50%

76%

60%

78%

56%66%

12%

7%

27%

25%

12%

24%

10%

22%

27%56%

34%

4%

25%12% 16% 13%

22%7%

Investment End-users Development

Deal size

10

Half of deals are over USD100 mn, none of over USD300 mn

Source: Colliers International

2007 2008 2009 2010 2011 2012 2013 2014 Q1-Q3 2015

24% 21%

42% 43% 48% 50%

22%

40% 44%

64%

28%36%

31% 25%

35%

50%

23% 21% 20% 12%

11% 10% 13%

15%21%

11% 11% 11% 14%8% 8% 8%

17% 23%

>300 101-300 51-100 21-50 <20

Deal size

11

Investors prefer standing income producing assets, 78% in Q1-Q3 2015

Source: Colliers International

2007 2008 2009 2010 2011 2012 2013 2014 Q1-Q3 2015

Standing Under development

in USD mn

Russia Investment BriefingEmmanuel Blouin Founder & Managing Partner

Esterel CapitalSergey Cheremin Minister, Head of

Foreign Economic & International Relations Development

Moscow City Government

Vladimir Frolov Director of the Centre for Energy Efficiency

Moscow State University of Mechanical Engineering Vladimir Pechurchik First Deputy General

DirectorTula Region

Development Corporation, JSCVladimir Sergunin Partner

Colliers InternationalMaarten Vermeulen Head of Europe, Russia & CIS

RICSModerator: Richard Betts Associate Publisher, PropertyEU

€500 Million

Where & how would you invest?

Thank YouEXPO Real 2015Day 1: Asset Management Briefing

17.15 The Networking Lounge, Hall A1, Stand 440Day 2: European Residential

10.00 Hall B3, Conference Room B31 (1st floor)

Germany Investment Briefing11.00 Hall B3, Conference Room B31 (1st

floor)Nordic Investment Briefing15.00 Intelligent Urbanization, Hall A1,

Stand 432European Logistics Briefing – Let’s Talk

Logistics 17.00 Special Real Estate Forum, Hall C2,

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