1. Winning Ways in a Small World Patricia Lines Bsc MRICS SIOR James Southey Bsc MRICS SIOR 2006 SIOR Spring Convention – La Quinta, CA USA

2. Winning Ways in a small World Doing International Business in the Real Estate Sector Patricia Lines Bsc MRICS SIOR James Southey Bsc MRICS SIOR April 2006

3. Who are we? Patricia Lines Qualified Surveyor SIOR since 2000 In Real Estate since 1986 Worked in Real Estate on a worldwide basis Lived and worked in Germany SIOR International Advisory Vice Chair Keen golfer! James Southey Qualified surveyor SIOR since 2000 In Real Estate since 1990 Licensed in NJ and worked in USA from 1999 through 2004 Based in London with responsibility for USA Winning Ways in a small World

4. Let’s take SIOR business in the right direction and take off for success Winning Ways in a small World

5. Where is this city? Image courtesy of Terry Farrell and Partners Winning Ways in a small World

6. EUROPE FRANCE SPAIN ITALY GERMANY NORWAY SWEDEN FINLAND NETHERLANDS BELGIUM POLAND PORTUGAL GREECE ESTONIA LATVIJA LITUANIA BULGARIA CZECH REPUBLIC BULGARIA SWITZERLAND AUSTRIA LUXEMBOURG UNITED KINGDOM DENMARK SLOVAKIA HUNGARY ROMANIA SERBIA MACEDONIA MONTENEGRO ALBANIA BOSNIA CROATIA SLOVENIA IRELAND Winning Ways in a small World

7. Why is doing business different? Cultural differences English language v American language Different time zones Different languages Ways of conducting meetings Winning Ways in a small World

8. Lease Structures in Germany Typically 5 plus 5 year leases Reviews linked to consumer price index No statutory right to renew Structural repairs - landlord Winning Ways in a small World

9. Italian Lease Structures 6 plus 6 year terms Annual indexation of rents Landlord responsible for structural repairs No full recovery of service charges Winning Ways in a small World

10. American and British Lease Comparisons – A few differences ClauseUKUSA Length of lease10 to 15 years5 to 10 years RentNETGROSS Rental paymentQuarterly in advanceMonthly in advance Security of TenureLegislativeContractual Service ChargesReimbursement of costs Fixed by annual escalation Winning Ways in a small World

11. Fee Structures CountryLease Fees Belgium15% of first years rent Czech Republic10 – 12% of one years rent Denmark15% of one years rent France20 – 30% of one years rent Germany20 – 25 % of gross annual rent Winning Ways in a small World

12. Fee Structures CountryLease Fees Italy1 – 2 months rent Ireland10 – 12% of first years rent Netherlands10% of first years rent Poland8.5 -10% of one years rent Spain10% of annual rent Switzerland15% of one years rent UK10% of one years rent Winning Ways in a small World

13. Office Rents Comparisons Winning Ways in a small World

14. Industrial Rents Comparison Winning Ways in a small World

15. International Case Study: Bristol Myers Squibb - Europe Winning Ways in a small World

16. Location Rhein-Main Winning Ways in a small World

17. St. Nazaire, France Manufacturing and R&D 63,034 ft² on 23.5 acres Valuation and P&M Winning Ways in a small World

18. UK and Germany 12 ongoing instructions out of approx 120 properties in Germany Opposite, HQ in Offenbach, Frankfurt – Honeywell 8,000 m² office relocation strategy completed Winning Ways in a small World

19. Examples of International Investment Business and pitfalls Buying Investments in the USA with a German Fund Winning Ways in a small World Meetings Culture Language Sq m/Sq ft Rent per annum/per month Definition of yields

20. Examples of International Investment Winning Ways in a small World Currency Issues Time Differences Legals Expectations Legislation/Tax

21. What steps should you take to do business outside North America? 1.Contact the local SIOR broker in the country or city 2.If no one listed call Patricia Lines or James Southey who will advise if their offices can help 3.The SIOR broker will explain the market differences and what needs to be done by You and Your client 4.The SIOR will know the local markets and idiosyncrasies as you would in the USA Winning Ways in a small World

22. From small acorns grow large oaks Winning Ways in a small World