Lowest interest rates for 40 years contribute to further increases in property lending figures

LOWEST INTEREST RATES FOR 40 YEARS CONTRIBUTE TO FURTHER INCREASES IN PROPERTY LENDING FIGURES In the second quarter of 2002, Bank of England statistics show that total property lending grew by some £2.7 billion taking the annual increase to £13.3 billion. This takes the total loans outstanding to property companies to an all time high of £76.850 billion (nearly double the early 1990s peak of £40.7 billion - quarter 2 1991)1 Commenting on this increase in the bank lending figures, Rupert Clarke, International Director of Jones Lang LaSalle and Managing Director of Jones Lang LaSalle Corporate Finance, said: "The extent of this quarterly increase is perhaps not surprising given that low interest rates and favourable debt terms mean leveraged investors continue to dominate activity in most real estate market sectors. Also, the recent plugging of the Stamp Duty savings loop-hole by H M Treasury created a peak of activity prior to the 23rd July deadline, a large proportion of which fell into the second quarter figures. The downward movement in the medium and long term interest rates has been particularly marked over the last few months and is likely to feed through to continued activity in leveraged acquisitions during the third and fourth quarters. Currently 5 year swaps rates stand at below 5% compared with around 5.5% a month ago and the average of 7% over the last 10 years." [SEE ATTACHED CHART] Results from Jones Lang LaSalle's own survey of property lending, in conjunction with IPD2, shows that for Quarter 2 2002, 24% of lending activity was related to the refinancing of existing loans. Commitment on speculative developments also increased to 12% of all lending compared to 3% for 2001. This increase appears to follow the market view that occupiers' demand would increase by Mid to Late 2003, but given the sample size (representing under 30% of the lending market), it is more likely to relate to one or two larger speculative commitments rather than a change in the general caution that banks continue to exercise in this area." (ends) Note to Editors: The official Bank of England figures are believed to account for only two-thirds of total commercial property lending as they exclude lending by building societies, insurance companies, securitised debt and lending by overseas banks' representative offices. The Jones Lang LaSalle / IPD Property Lending Survey was initiated in 2000 with the objective of providing a detailed and regular analysis of the lending market in the UK. The survey comprises a cross section of lenders including UK clearing banks, building societies, specialist lenders and German mortgage banks. The total loan book across participating lenders in Quarter 4 was £22 billion. Jones Lang LaSalle (NYSE: JLL) is the world's leading real estate services and investment management firm, operating across more than 100 markets on five continents. The company provides comprehensive integrated expertise, including management services, transaction services and investment management services on a local, regional and global level to owners, occupiers and investors. LaSalle Investment Management, the company's investment management business, is one of the world's largest and most diverse real estate investment management firms, with more than $22 billion of assets under management. Jones Lang LaSalle is also the industry leader in property and corporate facility management services, with a portfolio of approximately 725 million square feet (67 million square meters) under management worldwide. For further information, please contact: Rupert Clarke/Barry Osilaja Allyson Andrews/Charlotte Freeman, Jones Lang LaSalle Corporate Public Relations Department, Finance Jones Lang LaSalle on +44 (0) 20 7399 5550 +44 (0) 20 7399 5426 / 5616 allyson.andrews@eu.joneslanglasalle. com/ charlotte.freeman@eu.joneslanglasall e.com ------------------------------------------------------------ This information was brought to you by Waymaker http://www.waymaker.net The following files are available for download: http://www.waymaker.net/bitonline/2002/08/08/20020808BIT00430/wkr0001.doc http://www.waymaker.net/bitonline/2002/08/08/20020808BIT00430/wkr0002.pdf