Tokyo and Seoul, May 30, 2002 � Jones Lang LaSalle, the world�s largest real estate services and investment management firm, has released a research report that examines the impact of the 2002 World Cup on the real estate markets of the host nations. The report also looks beyond 2002 and draws out the implications of the experiences of previous hosts.

On May 31, 2002, the 17th FIFA World Cup football (soccer) tournament begins. The tournament in South Korea and Japan is the first World Cup to be held in Asia and the first to be jointly hosted.

Ben Sanderson, Associate Director, Asia Pacific Research, and the lead author of the report said, �The 2002 World Cup represents the largest capital investment ever in a football (soccer) tournament and is unlikely to be matched in the foreseeable future.� He continued, �Total investment in new stadiums and refurbished facilities, including additional infrastructure, is estimated to be US$5 billion for Japan." James Tyrrell, Director, Investor Services, based in Seoul, said, �In South Korea 10 new stadiums have been built at a total cost of US$2.5 billion.�

The host nations are hoping for a significant economic boost from the tournament equal to 2.2% of GDP in South Korea and 0.6% in Japan.  However, Jones Lang LaSalle suspects that these forecasts are likely to prove overly optimistic. 

�It is important to try to separate the World Cup effect from normal cyclical economic movements and to take account of the 'crowding out' effect on spending in other parts of the economy. We suspect that the World Cup will probably have little or no statistically significant impact on the host nations� GDP,� said Sanderson.

But The World Cup Will Have A Real Estate Impact. 

The effects will not be evenly distributed across the real estate sectors. Melinda McKay, Senior Vice President-Research of Jones Lang LaSalle Hotels, based in Chicago, said, �Hotel operators will benefit the most and can expect a significant short-term boost from the World Cup. We estimate that hotel operators could boost their average daily rates by 20%, revenues by 30%, and that occupancy could rise approximately 9% during the month of June.� 

The report suggests that the impact is likely to be concentrated. �Hotels in Tokyo and Seoul will gain the most and visitors will use these 'gateway cities' as a base to travel to and from games and between the two host countries,� continued McKay.

Retailers will also feel the benefit driven by boosts in domestic and international spending. �The World Cup will have a positive short-term effect on the retail sector through increases in retail sales and rises in domestic consumer confidence. Our research suggests that this may be connected to the performance of the Japanese and Korean national teams. The host nations do not have to win, but providing that they perform above expectations, it is likely that the positive effects will be greater,� said Tyrrell.

Potentially the most significant impact on real estate is the long-term legacy of the stadiums themselves. Sanderson explained, �For the first time, the organizers hope to use the World Cup as a catalyst for urban regeneration. Seventeen new stadiums have been built in 20 host cities. This is the largest number of World Cup venues ever used.� Jones Lang LaSalle�s research suggests that it is difficult for sports stadiums to generate economic benefits in their own right as they often compete with other higher-value, best-use options. Sanderson continued, �Stadiums need a viable and sustainable business plan to be useful after the tournament is over.�

Tyrrell said, �Unlike the Olympics, the World Cup does not have a concentrated impact on any one city; therefore, the possibility of successfully leveraging urban regeneration benefits from the tournament is reduced. Many of the new stadiums for 2002 do not appear to have the necessary mechanisms in place to leverage the regeneration benefits they are hoping for.� 

Jones Lang LaSalle�s analysis of previous host cities presents a series of important lessons for its 2006 German hosts. Sanderson explained, �Future hosts need to consider the number and location of host cities. Hosts have a choice between a smaller number of host cities with a more concentrated real estate impact or a greater number of host cities with more diffuse real estate benefits.� 

However, Jones Lang LaSalle�s report concluded that despite the significant potential impact of the World Cup on real estate markets, there is additional appeal to being a host.  According to Sanderson, �The current host nations (or an immediate neighbor) have won nine of the 16 previous tournaments. Serving as host increases the chances of playing well in the tournament. Although it might be too much to expect a Korea-Japan final, the host nations are typically among the more likely candidates to outperform their global ranking. 'Home advantage' will likely prove significant in 2002.� 

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.