A presentation to ' Other details'''

1
CZECH REPUBLIC REAL ESTATE MARKET April 2006
2
Contents

• Why is CW presenting?
• Location/Population in Context
• Why is Czech Republic Relevant your competitors
• Economics
• Industry
• Infrastructure
• Labour
• Property
• Healthy Place to Live
• Testimonials

3
Why is CW presenting?

• 1. Initial contact with new companies
• 2. Good experience in the Czech Republic
• - Loyal workforce
• Koho chleba jí, toho písen zpívej
• (Whose bread you eat, that persons song you
  should sing)

4
CENTRAL EASTERN EUROPE A GROWING MARKET

• Central Europe
• Czech Republic
• Hungary
• Poland
• Slovakia
• Eastern Europe
• Baltic States
• Romania
• Bulgaria
• Other Markets
• Croatia
• Slovenia
• Turkey
• Russia

5
Population No. of Cities of over 100,000
Inhabitants
Country
Population
Poland
38.7 mn
39
10.2 mn
Czech Republic
Slovakia
5.4 mn
Hungary
10.1 mn
10
Total - 4 countries
64.4 mn
5
Germany
82.0 mn
Great Britain
59.7 mn
France
58.8 mn
10
Italy
57,2 mn
Spain
39.4 mn
6
Your competitors are already expanding in CE
Source CW European Cities Monitor 2005/2006
7
Your competitors are already expanding in Czech
Republic!
Source Czech National Bank 2005

• 20 to 30 German firms will invest in CZ in 2006
• (Source - Czechinvest Germany)

8
Moodys changed rating from stable to positive
reflects improved macroeconomic and structural
reform efforts
Economic background

• Record GDP growth
• in 2005 6
• Mainly export (automotive), FDI and consumer
  spending driven.

9
Economic background
The Czech Republic is at the top of the region
both in terms of the volume of FDI per capita.

• Manufacturing is a traditional sector in CZ.
• Service sector is increasing.

10
Czech Republic Industry and Innovation

• Czech Republic
• Top car producer - Skoda, TPCA (Toyota, Peugeot,
  Citroen), Hyundai
• Number 2 in the world as for the number of cars
  produced per capita
• 4th placed distribution location in Europe (top
  in CE) CW Research 2006

11
Czech Republic Innovation / Forward Looking

• Czech Republic
• World Bank acknowledges CZ as an advanced
  country (net contributor)
• 2007 to 2013 CZ can expect the following EU aid
  (national development plan recently revealed)
• 5 Bill Euro (railways)
• 3 Bill Euro for direct business support
• 5 Bill Euro for schools, training and
• 1,5 Bill Euro for research
• Mobile penetration is one of highest in Europe.
  Number of mobile phones exceeded the number of
  population in the Czech Republic in 2005
• Czechs spend more time at work than any other EU
  nation. Average of 5 hrs per week more than
  average 38 hrs (Eurostat 2006)

12
Prague Ruzyne - airport
Czech Republic Infrastructure

• Largest airport in Central Europe
• Capacity more than 15 million passengers per year
• Last year there were about 10million passengers,
• 30 year-on-year increase
• There are 4 terminals
• At the beginning of 2006 a new terminal, North 2,
  was opened, which will absorb further 5 million
  of passengers
• International airports also in Brno and Ostrava

13
Prague public transport
Czech Republic Infrastructure
14
Highways
Czech Republic Infrastructure

• Most developed highway infrastructure in Central
  Europe
• More than 900 km of highways in operation

15
Competitive Position Skilled People
16
Emerging Europes Top Commercial Property Markets

• Ranking by
• Macro Factors (EU accession, Politics, Economic
  foreign investments)
• Property Market Activity (maturity, occupier
  and investment activity and values
• Property Market Structure (transparency,
  foreign ownership, leases, property taxes
  costs, legal structure planning)

Source 2004 Emerging Europe report, CW/HB
17
Office Market - Prague
18
Potential office accommodation Prague
Edge/Centre and Out of Town
Office Park Nové Butovice Prague 5
Danube House/Nile House Prague 8
The Park, Chodov Prague 4

• Multi-phase project
• 15 EUR/sqm/mth
• 9000sqm available in 1st Q 2006
• 1200 sq m floor-plates

• Nile House/Danube House
• 10.000 sqm available)
• 2,500 sqm floor-plates

• Multi-phase project
• 1.200-8000 sqm
• 14EUR/sqm/mth
• 600 - 1200 sq m floorplates

19
Potential office accommodation Ostrava Brno
Axis Office Park
Spielberg Brno Technology Brno
Park

• Multi phase project
• Business Park
• 10,75 EUR/sqm/mth
• Targeted at technology / research companies

• 10.000 sqm total
• 10,5 EUR/sqm/mth
• 5.000 sqm available
• Available May 2006

• Multi phase project
• 20,000 sqm
• 11,5 - 12 EUR/sqm/mth
• Available immediately

20
Czech Republic A healthy place to live!

• Supersize me was reproduced in the Czech
  Republic
• Similar trial 1 month of Czech pub food only
• Results
• The subject LOST 6 kilos!
• Cholesterol levels dropped!
• Healthy body healthy mind!

21
Testimonials

• We are very pleased that Sun chose to locate its
  development center in the Czech Republic over
  other attractive locations around the world,
  said Zdenek Pilz, general manager of Sun
  Microsystems' Czech branch, on the occasion of
  the new development centers opening. "Prague was
  chosen especially thanks to its abundance of
  software-development specialists, excellent
  infrastructure, stable economic and political
  environment, andof no less importancethe
  helpful attitude of the government as represented
  by the agency CzechInvest.
• One of the latest examples is the investment of
  the British company Westcombe International
  Research s.r.o. in Olomouc (Moravia). The firm
  will build a call center costing more than 1
  million dollars and employ around 30 people. At
  the same time, this concerns the first British
  investment that CzechInvest has assisted in
  locating in the Olomouc region, says CzechInvest
  Regional Manager Pavlina Fliskova. The company
  conducts international marketing research for
  firms such as Accenture, Hewlett Packard, IBM and
  Microsoft. The Olomouc center is set to start
  operation on 1 February 2006. Its possible to
  locate this type of investment practically
  anywhere. However, we chose Olomouc because it is
  home to Palacky University and there are plenty
  of students who speak English and many other
  languages who we can employ effectively in the
  call center, adds Westcombe CEO Justine Kemp.
• SAP BSCE provides human resources (HR) and
  finance and administration (FA) services to SAP
  branch offices in the Europe, Middle East and
  Africa (EMEA) region. The centers current
  workforce of approximately 132 employees supports
  70 countries in 15 different languages. SAP
  analyzed and evaluated 18 European cities to
  determine the best location for the new BSCE. The
  company ultimately chose Prague because of the
  citys highly skilled and flexible workforce,
  advanced telecommunications and IT
  infrastructure, cultural compatibility and stable
  economic and political conditions. In addition,
  the city is ideally located within Central and
  Eastern Europe.

22
Inward investment

• Largest Investment projects in 2005 production
• Investor Sector Country of origin Inv (USD
  mil) Jobs Region
• Skoda Auto automobile Germany 237,92 2,150 Hrade
  c
• Tivall food Israel 130,75 300 Usti
• SUNG WOO Hittech automobile South
  Korea 111 1041 Moravia-Sils
• SWP Trading chemical Czech Republic 53,90 76 Mora
  via-Sils
• PEGAS Chemical (textile Czech Republic
  53,14 35 South Moravia
• Largest Investment projects in 2005 technology
  centers and shared-services centers
• Investor Sector Country of origin Investment (USD
  mill) Jobs Region
• Czech Airlines aviation Czech Republic 52,34 400
  Prague
• Computer Ass. it USA 48,92 218 Prague
• FTE automotive auto Germany 46,24 588 Usti
• Lonza Group biotech Switzerland 18,35 50 Central
  Bohemia
• LATECOERE aviation France 8,90 150 Prague

SourceCzechinvest