CBRE

Adaptivespaces

what'SHappening

(andwhat'SNext)in

AutomotiveRetailRealEstate?

VIEWPOINT

sidharthDhawan

ExecutiveDirector

HeadofAlternativesLeasingAsiapacific

vivekkaul

ManagingDirector

HeadofRetailLeasing,Asia

JonathanHills

seniorDirector

AsiapacificResearch

CBRERESEARCHOCT2025

Adaptivespaces

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Introduction

Recentyearshaveseentheglobalautomotiveindustrygrapplewithanarrayofchallengesincludingsupplychaindisruption,theongoingtransitiontoandsubsequentslowdowninEvsales,evolvingconsumer

requirements;and,mostrecently,escalatinggeopoliticaltensionandtariffs.

otherhurdlesincludeaneedtocomplywith2030netzeroandsustainabilitytargets(formanufacturerscontinuingtobuildpetrolenginecars)andregulatoryrequirementsrelatedtonewtechnologiessuchasconnectedandautonomousvehicles.

Labourshortagesposefurtherchallenges,withdecliningbirthratesandyoungergenerations'unwillingnesstoenterthetraditionalmanufacturingsectormakingitevenmoredifficultforautomakerstofindstaffincertainmarkets.

Therealsoexistsawideningskillsgapasautofirmsstruggletorecruitemployeeswithnewandsought-aftertechnicalskillssuchasthoserelatedtoEvtechnology,software,anddataanalysis.

Againstthisbackdrop,manyautofirmsinAsiapacificarereorganisingoperations,reducingheadcount,andengaginginM&Aactivityandstrategicpartnerships;aprocessthatisinevitablyreshapingtheircommercialrealestaterequirements.

ThisviewpointbycBREexploresthelatesthappeningsinautomotiveretailrealestateinAsiapacificinwhatisanincreasinglycomplexandcompetitivemarketplace.

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FormatsofAutoRetailRealEstate

AutoretailrealestateinAsiapacificvariesacrossindividualmarketsandcomprisesofmultipleformats,themaintypesofwhichinclude:

showrooms

conventionalsalesoutletsdisplayingcurrentmodelsandoffering

relatedservicessuchasfinancingandaftersalessupport.storesinthisformataretypicallylocatedinmajorurbancentres,high-footfall

commercialzonesandalongsidemajortransportationroutes.Luxury

brandsusuallysetupstoresinpremiumdistrictswhilemassmarket

autoshowroomsaremorebroadlydistributed.visibilityandroadaccessfortestdrivesandconsumerparkingareprioritisedinsiteselection.

Experiencecentres

Multifunctionalandinnovativespacesthatcombineavarietyof

elementsincludingvehicleshowcases;brandeducation;product

appreciation;testdrivesandotherfeaturesunderoneroof.Thisformataimstobuildcustomerloyaltyandcreatememorableinteractionsthatfosterastrongerconnectionwiththebrand.storesaretypicallylocatedinlarge(1,000sq.m.andup)unitsinprimeshoppingmallsandstreet

shopsincorelocations.someexperiencecentresmaynotevendisplaycurrentmodelsforsale,insteadshowcasingclassicmodelsand

exhibitingmaterialrelatedtobrandhistory.

4sstores

Formats,usuallydealerships,thatintegratesales,service,sparepartsandsurveys(4s)asaone-stopshopsolution.Theyusuallyoffer

multiplebrandsandarelocatedinprimeurbanareasofmajorcities.Thisisthestandardformatinmainlandchina'sautomotivesector.

Evchargingstations

commercialhighpoweredEvchargingsystemsinstalledindesignatedareasinshoppingmalls,retailstoresandpetrolstationsforpublicuse.Demandforsuchfacilitiesisrapidlyincreasing,creatingnewrevenueopportunitiesforcommercialpropertyowners.

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MainlandchinaEvsspearheadshowroomGrowth

MuchoftherecentgrowthinAsiapacificautoretailrealestatehasoccurredintherealmoftheshowroom-alongmmestablishedformatwhichhastraditionallyservedasalocationforpotentialbuyerstoviewandinspectvehiclesfirst-hand,performtest-drives,andinteractwithsalespeopleandbeenspearheadedbymainland

chineseEvbrands,firstlyintheirhomemarket,andmorerecently,insoutheastAsia.

Thesebrandshaveprioritisedvisibility,accessibilityanddowntownpresenceaskeyprinciplesforbuildingouttheirstorenetworksinmainlandchina,focusingonsecuringspaceforshowroomandflagshipstoresinprimeshoppingmallsoperatedbyexperiencedlandlordsincorelocationsofmajorcities.1

Leveragingthehighprofileandstandingofleadingshoppingmallsiscriticalinhelpingthesecompaniesbuildbrandimageanddrivesales.Evbrandstendtotargetspaceinmallswhereavailable,particularlypropertiesofferingaclusterofcomparableautomotivebrandsandaselectionofotherlifestyleretailersappropriatefortheirtargetconsumer.

ThishasledtotheagglomerationofEvandotherautobrandswithinmainlandchina'smalls,withthelikesofMixcmallinzhongshansettingasideanentirefloordedicatedtotheautomotivesectortobuildastrong

placemakingelement.

unlikemostotherretailtrades,autoshowroomstypicallyrequirespacewithcertaintechnicalspecificationsduetothesizeandweightofthegoodsondisplay.Groundfloorlocations,directvehicularaccess,highload

capacitypersq.m(typicallybetween500mm1,000kg),ultrammhighceilings,extrammwidedoorsandalimited

numberofcolumnsareallessential.Theseattributesaremorecommonlyfoundinrelativelynewershoppingmallsormoderngroundfloorstreetshops.

ThelastcoupleofyearshaveseenthefocusofmainlandchineseEvexpansioninAsiapacificshiftto

emergingsoutheastAsia,backedbygrowingdemandforEvsandsupportivegovernmentincentives.spaceinshoppingmallsremainspreferredinmarketssuchasIndonesiaandThailand,althoughalackofsuitableoptionsmeansEvbrandshaveleasedstreetshopsandevengroundfloorsofofficebuildingsinprimeareas.

1RechargingRetail:LeasingstrategyforElectricvehicleBrands,CBREchinaResearch,May2020.

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TheRiseoftheExperiencecentre

Recentyearshavewitnessedanevolutionintheautoshowroomconcept,withtheadventofexperiencecentresthatblendphysicalanddigitalelementstoprovideamoreholisticandcustomercentricoffering.

Theriseofyoungerconsumershasdrivenashiftinthinkingaroundstoredesignandretailleasingstrategyamongautomanufacturers,promptingbrandstoswapshowroomsforexperiencesintheformofinnovativeandcentrallylocatedlargeurbanstoresdesignedtoappealtothistargetdemographic.

MainlandchineseEvbrandshaveonceagainbeenattheforefrontofthistrend,withBYDopeningitsfirstexperiencecentreinwuhanin2023acrossfivefloorsatthewuhanInternationalconference&Exhibitioncentre2;GeelylaunchingitspolestarBrandExperiencecentreatxuhongMiddleRoad,shanghaiinAugust20243;andGAcunveilingitsGACBsathornExperiencecentreinsathorn,BangkokinJune20254·

InresponsetomainlandchineseEvfirms'rolloutofexperiencecentres,manywesternandAsianauto

originalEquipmentManufacturers(OEMS)areupgradingtheseandotherretailformatstoamorepremiumofferingtotapintogrowingconsumerdemandforluxuryproductsandexperiences.withmanysuch

companiesnowviewingthemselvesasluxuryretailers,theyarededicatingconsiderableresourcestocrafting

asuperiorrealestateandserviceofferingfortheirhighmmendbrands.

ThisglamourisationofautomotiveretailrealestateisseeingautooEMsanddealershipsacrossboththe

premiumandmassmarketsegmentstargetmultistoreyfacilitiesinprimelocations;investinsuperiorqualityandcraftsmanshipoffitout;employhighlytrainedandeducatedstaff;offerarangeofamenitiesincluding

F&Bandchildren'splayareas;andevenarrangeexperiencesinexternallocationssuchastestdrivesaroundprofessionalracingcircuits.

Amidintensecompetitionforcustomers,autooEMsviewthepremiumisationofretailspaceaskeytoachievingdifferentiationandensuringtheirbrandmorestronglyresonateswiththeconsumer.

ExamplesofthistrendincludeGeneralMotors'DurantGuildExperiencecentreshanghai,whichopenedinAugust2024,andincludesareasdedicatedtovehicledisplays,lifestyleretail,andacaf?lounge.consumerscanalsotakeculturaltourstolearnaboutthecompany'shistory5.

Inkorea,Hyundal'shighendGenesisbrandoperateswhatitcalls"studios"inhighfoottrafficcBDareasaswellaslarger"showcases",suchastheGenesischeongjufacilitythatopenedinApril2025inNorth

chungcheong6,

2https:/lwwwarenaevcom/byd_experience_center_opens_in_wuhannews-1857.,php3china_news/70034210.html

https:/lwwwnewswire.ca/news-releases/gacbsathorn-experiencecenteramp-9ac-thailandbatteryservicecenterofficiallyopen-811955107.html

5/blog/2024/08/gms-thedurantguildexperiencecentershanghai-opens-itsdoors/

/kr/en/experience/space/genesischeongju.html

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CBRERESEARCH

Locatedacrosseightfloorsandalmost7,000sq.m.,Genesischeongjuresemblesacontemporaryart

museumwithexhibitionspace;aloungeareaforeducationalandcreativeworkshops;acaf?exclusivelyforGenesisowners;andasignaturefragrancespeciallycreatedforthebrand.Thefacilityaimstoenable

customerstoexperienceGenesisvehiclesfirsthand;showcasethefirms'brandvalues;andserveasacommunityhub.

capitalisingonDemandforEvcharging

GrowthinEvusageisbringingwithitincreasingdemandforpublicEvchargingstations,especiallyinhighdensitymarketssuchasHongkongsARandsingapore,whereprivatechargingischallengingduetothebulkofthepopulationresidinginapartmentblocks.

AvailabilityofEvchargingfacilitiesiscomingtoberegardedasanessentialamenityformodernshoppingmalls,boostingcustomerloyaltyanddemonstratinglandlords'commitmenttosustainability,whilealso

creatingopportunitiesfornewrevenuestreamsthroughchargingfeesandassociatedspending.

commercialretaillandlordsinAsiapacificareplayinganintegralroleinthedevelopmentofpubliccharginginfrastructureforEVS,withEvchargersalreadycommonplaceinshoppingmallsinmajormarkets.

shoppingmallownersmustensuretheirfacilitieshavesufficientpowersupplyandcomplywithsafety

measuresforchargingpointsThiscanbechallengingforolderbuildings,whichusuallyhavelimitedsparepowersupplycapacityand/orfloorloading,asEvsareheavier.Inemergingmarkets,inadequateorunstablepowergridsmayposeachallenge.7

GiventhatcharginganEvusuallytakesatleast20minutes,CBREexpectsownersofEvstoseekoutlocationsprovidingawiderangeofentertainmentoptionstooccupytheirtimewhiletheywait.From

landlords'perspective,providingEvchargingpointscanincreasecustomers'dwelltimewhileboostingspending.

completedin2023,AirsideshoppingmallinHongkongsAR'skaiTakdistrictoffers851parkingspaces,allofwhichareequippedwithEvchargingfacilities.Footfallinthemallisstrong,withmanyEV-ownersvisiting

specificallytochargetheircarsandvisitF&Bwhiletheywait.

AlsoinHongkongsAR,therelativelackofpubliccharginginfrastructureispromptingentrepreneurstoexploreleasingstreetshopsinnoncoreareasinwhichtoinstallEvchargersforpublicuse.

FutureInnovations

withexperiencecentresandpremiumisationnowfirmlyestablishedtrends,thoughtsarenowturningtothenextstageintheevolutionofautoretailrealestateinAsiapacific.

7HowwillElectricvehiclesImpactRealEstate?,CBREResearch,october2023.

CBRERESEARCH

whilesomeoftheregion'smajorcities,particularlyHongkongsAR,areboundbygeographicalandproperty-

relatedconstraintsthatmakeitchallengingtolocateunitssuitableforautoretailindowntownareas,thecomingyearscouldseenewformatsmaketheirwaytotheregion.

TheseincludemixeddevelopmentconceptssuchasTesla'ssuperchargerDiner&Drive-In-a24-hourrestaurantandmovietheatreonsantaMonicaBoulevard,LOSAngeles.

openedinJuly2025,themultimmfunctionaldevelopmentfeatures75chargingstationsforTeslavehicles,a1950sstylerestaurant,abar,rooftopseatingandoutdoormoviescreens.

ThismultifacetedapproachfeaturingaclassicAmericanrestaurantwithmodernEvchargingandentertainmentcouldbethemodelforanewtypeofpremiumTeslachargingstations.

Beforeconsideringnewformatsorcommittingtonewstoreopenings,autobrandsareadvisedtoconductmarketmappingexercisestoensuretheyarefullyappraisedoftheavailabilityofrealestatesuitedtotheirspecifictechnicalrequirements

Analysisisbecomingincreasinglysophisticated,withexperiencedrealestateconsultantsnowableto

leveragemassmobiledatatostudystreetsmostfrequentlyvisitedbyanautobrand'stargetconsumersaswellasitscompetitorsandkeypointsofinteresttoascertainthestreetsthataremostsuitable.

Layeringthisanalysiswithlocalinsights,includingspaceavailabilityandestimatedrentsandmappingthisontointeractivedashboards,autobrandscanobtaininsightsandrecommendationsintomarketoptions

alongidentifiedstreets.

7HowwillElectricvehiclesImpactRealEstate?,CBREResearch,october2023.

contacts

AsiapacificResearch

Adachoi,CFA

HeadofResearch,Asiapacific

ada.choi@cbre.com

JonathanHills

seniorDirector,

AsiapacificResearch

jonathan.hills@cbre.com

Nancywong

AssociateDirector,

AsiapacificResearch

nancy.wong1@cbre.com

Leasingservices

TomGaffney

sidharthDhawan

vivekkaul

RegionalManagingDirector

ExecutiveDirector

ManagingDirector

HeadofLeasing,

HeadofAlternativesLeasing

HeadofRetailLeasing,

Asi