Market Report Q1 2016, NAI FirstPartners

Market Report 1 / 2016

Market Report 1 / 2016

NORWAY’S LEAN YEARS

Will Norway join the NIRP countries in 2016–2017?

Once, Norway was Europe’s strongest economy, but now with an oil industry that is contracting both in total size employed and employment, Norway is becoming much more like the rest of Europe.

In the domestic economy it is the household sector and the rate sensitive housing sector that will be helped by further cuts. In the longer term there is an increasing risk of ­f inancial instability. Household debt stand at a ­record high of 220 pct of their income. A rate that is i­ncreasing by almost 10 percentage points a year. ­Income growth is flat in real terms, meaning that the ­increased debt load only can be served as long as interest rates stay low.

In our forecasts Norway will gradually lower interest rates, but not enough to normalize growth. The need for more stimulus, and even lower interest rates, will sooner or later probably also push Norges Bank into negative interest rate territory.

Regionally it is housing in the capital area that benefits most from rate cuts. In Oslo these days, there is widespread complacence about the medium term outlook.

After all, employment in the wider metropolitan area of the capital has not gone down. Housing prices are still rising by 5-10 pct a year. However the commercial ­market on the outskirts of the city is getting gradually weaker as many oil service related companies who are scaling back employment, have based themselves on the south western side of the city. On the east side towards the main airport there is a question mark hanging over the need for all the new buildings being planned.

In 2015 Norway avoided recession thanks to e ­ xpansionary fiscal policies (adding half a percentage point to GDP), lower interest rates and a weak currency. Despite this support, the mainland economy only mustered one percentage point of GDP growth. Growth being dragged down by sharply lower activity in the energy sectors.

Also, in coming years reduced investment, maintenance and employment in the North Sea will be a consider­able drag on economic growth. Fiscal policy will also be constrained by the 4 pct rule for use of oil money. M ­ onetary policy is increasingly important whenever there is a need to stimulate the economy. If oil prices stay low, the mainland economy will probably remain weak enough to justify gradual interest rate reductions to minus half a percentage point.

Lower interest rates and volatile equities suggest that ­investors will continue to pour money into real estate in the near term future. The focus for many will be income preservation and we expect prime yields to fall below 4 pct as Norway’s central bank nears ZIRP. But with overcapacity in many segments of the property market in most cities and towns, the prime segment is shrinking.

And without any recovery in the oil sector, policy rates will probably stay in negative territory for many years to come.

Unemployment will continue to increase as economic growth remains below trend. A gradually weaker labour market will also hit wage growth. Labour demand will remain muted for the foreseeable future in Norway’s slow growth future. Highly indebted and aging workers will be careful about making unrealistic demands that could jeopardize the health of their companies.

The main effect of interest rate reductions is to keep the currency weak. However, given that many countries are playing this game, we do not foresee any further ­weakening of NOK against an average of currencies. On the contrary given the huge move we have seen, some retracement is in order for the next couple of years.

2

Market Report 1 / 2016

5 YEAR SWAP NOK 5 4,5 4,0 3,5 3,0 2,5 2,0 1,5 1,0 0,5 0 02.03.11

02.03.12

02.03.14

02.03.13

02.03.15

02.03.16

Source: Eika Gruppen

Macro forecasts for Norway

2014

2015

2016E

2017E

2018E

GDP

2.2

1.6

0.9

1.7

1.6

GDP-Mainland

2.3

1

1.3

2.2

1.9

Wage growth

3.1

2.8

2.5

2

2

CPI average YoY

2

2.1

2.6

1.5

1

CPI core average YoY

2

2.7

2.7

1

1

Unemployment December

3.5

4.6

4.9

5.3

6

3-mth rates December

1.7

1.1

0.4

0.1

0.1

Housing price growth YoY

2.7

5

5

2.2

0.1

Oil price Brent Blend 3-mnth USD, Dec

56

36

50

60

60

NOK/USD, yearend

7.43

8.8

8.5

8.3

8.1

NOK/EURO, yearend

9.03

9.6

9.4

9.2

9

102

110

107

106

104

I-44, yearend Source: Statistics Norway, Eika Gruppen

project will be a major drag on growth. In 2019–2020 Norway’s oil service industries will need some new major projects to keep shipyards and engineers busy.

In the forecasts there is no crisis in the broader economy or crash in the housing markets. Just several years of growth below tend. A major rise in the oil price which is sustained could give us stronger economic growth, higher interest rates and a jump in the value of the NOK.

Jan L. Andreassen

On the other hand, sentiment is very vulnerable to ­renewed weakness in the energy markets. Over the ­horizon the completion of the giant “Johan Sverdrup”

Chief Economist, Eika Gruppen 3

Market Report 1 / 2016

THE TRANSACTION MARKET EVENTS AND TRENDS SO FAR IN 2016 • Interest in the market for buying commercial real estate remains strong and investors in all segments are still pursuing attractive real estate opportunities.

• Continued decrease of i nterest rates, as well as high attractiveness compared to other asset classes, will attract investors.

• Both national and international pension funds are ­looking to invest in the Norwegian real estate market.

• Other fund structures, real estate companies and especially development-oriented real estate companies are also active.

• The significant weakening of the Norwegian krone (NOK), both against the euro and the dollar, is likely to drive inflation higher than previously forecasted. This can make real estate investments with long and secure leases even more attractive.

• Among those seeking cash flow projects, we find many investors who are delaying investment because offered projects are considered too expensive.

• There is a shortage of attractive objects in the ­market.

However, we believe several potential sellers will ­realize profits and invest in development projects. We also expect investors to “trim” their portfolios.

• We will see both sellers and buyers expecting prices to remain relatively stable, thus finding the time right to conclude deals.

• Banks will still be selective. Equity requirements are in most cases increased, and banks’ margins are ­generally higher than last fall. The banks became more selective at the end of 2015 due to the new regulatory capital r­ equirements, as well as higher funding costs. ­Financing of new projects is more client and project dependent than before.

• The introduction of property tax on commercial ­properties in Oslo from 2017 does not seem to have affected the market negatively yet.

• We have yet to see all effects of the fall in oil prices and the negative impact on the Norwegian ­economy.

There is no doubt that this will affect the rental m ­ arket to a greater extent than we have seen so far. It will be i­nteresting to see to what extent new activity, both in the export industry and in other sectors, can ­compensate for this.

• The development in the rental marked will continue to affect the transaction market, and we believe we will see a greater segmentation of yield levels.

Two months into 2016 we can conclude that the activity in the transaction market has been high so far this year, however the number of completed transactions are m ­ oderate.

Many of these are projects that were not finalized last year.

Several new initiatives have commenced ­recently and there is still general optimism in the CRE market, despite the weakening macroeconomic prospects.

2015 will stand as the peak year in total sales of ­commercial property in Norway. The transaction m ­ arket was particularly good, with falling yields and good ­access to capital. A substantial share of the transactions made was large portfolios. The total volume of CRE transactions (traditional commercial and ­development properties, both residential and commercial) was ­approx. NOK 128 billion (€ 14 billion). The Oslo region ­represents approx. 45 % of this traded value. 2015 will undoubtedly become a benchmark year.

Despite funding being less accessible in comparison to 2015, we are expecting a relatively solid market in 2016.

Our forecast for 2016 estimates a turnover volume of approximately NOK 75 billion (€ 8 billion).

KEY FIGURES 2015 • Total turnover NOK 128 billion (€ 14 billion).

• 250+ transactions valued above NOK 50 million (€ 5 billion).

• Foreign investors represented approx. 40 % of total investment value. International capital has been particularly present in the large portfolio deals that characterized 2015.

• A number of the property funds established ­prior to the financial crisis have been ­strongly present on the sell side in 2015. Also, the ­traditional real estate companies have taken profit, with declining yields and accessible ­capital increasing property values. ­Surprisingly, pension and insurance companies sold ­significant parts of their portfolios (sale of assets to a value of approx. NOK 12 billion, € 1 billion).

• Office yield in CBD down towards 4 %. Normal office yield approx. 6.5 %.

4

Market Report 1 / 2016

Prime yield - office CBD

REQUIREMENTS FOR RATE OF RETURN

4.0 %

• Office: Investors’ required rate of return fell ­throughout 2015. We estimate prime yield to 4.0 % for o ­ ffice p ­ roperties in the CBD. However, we do not rule out several transactions on the 3 % level for good ­properties with long leases. Normal yield in the office market is approx. 6.5 %.

Prime yield - warehouse

5.5 %

• Warehouse and logistics: Prime yield on warehouse and logistic buildings is approx. 5.50 %.

Prime yield - retail

4.0 %

• Retail: Prime yield on retail (high street) and best shopping center down towards 4 %. Normal yield +/- 6 %.

RECENT TRANSACTIONS Oslo

Month

Approx. sq.m.

Type

Seller

Buyer

Est. Value NOK mill.

Landplot B4, Paulsenkaia

Jan

4,878

Land/Development

HAV Eiendom

Stor-Oslo Eiendom

-

Kalbakken senter

Jan

4,300

Retail

Ragde Eiendom

Daimyo Eiendom

80

~8

Rådhuspassasjen

Jan

10,000

Office/Retail

Eiendomsspar

Nordea Liv

605

4.8

Norway excl. Oslo 9 retail properties

Est. yield

Month

Approx. sq.m.

Type

Seller

Buyer

Est. Value NOK mill.

Est. yield

Jan

9,305

Retail

Syndicate (Pareto Project Finance)

AKA Eiendom (8), Reitan Eiendom (1)

-

-

10 retail properties

Jan

10,560

Retail

Syndicate (Pareto)

Sandviken Eiendomsutvikling

~175

-

5 combination properties

Jan

31,000

Office/­ Warehouse

NorSea Group Property

Asset Buyout Partners

875

-

Krambukvartalet, Trondheim

Jan

15,350

Retail

KLP Trondheim

E.C. Dahls Eiendom

~223

-

Øvre Strandgate 2, Drammen

Jan

5,000

Office

Oxer Eiendom

Fevang AS

105

~5.8

Raufoss Industripark

Jan

240,000

Industry

Raufoss Næringspark ANS

Syndicate (NRP)

1,300

~7.5

Dansrudveien 75, Drammen

Jan

2,000

Logistics

Dalen Næringspark

Ragde Eiendom

130

-

Teater Ibsen, Skien

Jan

-

Other

Bratsberg Gruppen

Ragde Eiendom

80

-

Espehaugen 29, Bergen

Jan

2,400

Industry

Stavanger Realinvest

Ragde Eiendom

80

Landplot, Bjørndalen, Kristiandsand

Jan

35,000

Land/­ Development

Begg Eiendom AS og familien Byggland

Skanska Eiendomsutvikling

-

Conrad Mohrs veg 29, Bergen

Jan

8,540

Office

Odfjell SE

Odfjell Eiendom, Norchem, Rederiet Jacob Christensen

191

Niels Juels gate 50 / Alexander ­Kiellands gate 2, Stavanger

Feb

7,635

Development

Stavanger kommune

Base Property

63

~6.5

Skedsmo senter

Feb

17,400

Retail

ICA Eiendom Norge

Scala Retail Property

-

-

Skattørvegen 53, Tromsø

Feb

-

Warehouse/ Industry

Nordviksenteret Eiendom

Axera Business Management

68

-

Bjørnstjerne Bjørnsons gate 80, 86-92/CO Lunds gate 25, Drammen

Feb

13,000

Retail

Bjerknes & Bragernes Eiendom

Aberdeen Eiendomsfond Norge I

-

-

Lagårdsveien 44, Statens Hus, Stavanger

Feb

20,500

Office

Syndicate

Syndicate (NRP)

~700

~5

Fjellbovegen 9, Berger

Feb

12,570

Logistics

Nordea Liv

Nordic Real Estate Partners

~155

~6,6

March

16,000

Development

Ragde Eiendom

Daimyo Eiendom

44

Industrial property, Rygge

Development Source: NAI FirstPartners. Known transactions.

5

Market Report 1 / 2016

THE RENTAL MARKET The activity in the rental market was high in the last quarter of 2015, and the activity is still relatively good in all segments. We find that many companies and ­organizations are now considering new and improved solutions for their premises, and many see opportunities in a market where the supply side is prepared to offer good solutions for existing and potential tenants. We expect an increasing activity throughout 2016.

Vacancy rate Office - Oslo

Average rents were lower in all four quarters of 2015 compared to 2014. According to Arealstatistikk, the ­average rent in 2015 for new office leases in Oslo was NOK 1,775 per sq.m.

RENT LEVELS - OSLO OFFICE

8.25 %

Submarket

THE OFFICE SEGMENT • There is good demand for premises in the city center (Oslo S, Kvadraturen) and CBD (Vika, Aker Brygge, B ­ jørvika etc.).

Rents in these areas have relatively low volatility.

• Firm rent levels are also seen where there is good access to public communication and major roads (Skøyen, Nydalen, Bryn/Helsfyr).

• So far, we have seen growing vacancy and pressure on rents in the western corridor from Lysaker/­Fornebu to Asker. Lysaker has experienced declining rent levels for both the prime and moderate segments for quite some time already, while supply is relatively high.

Furthermore, we suspect that there is some concealed ­vacancy. Subletting happens increasingly, which ­obviously contributes to reduced rental levels.

• Thus, we believe that the prices in this region have reached a level where a new segment of businesses which previously considered Lysaker as too expensive, soon will consider this as an attractive location for their operations.

• The vacancy in Oslo seems to decline from 8.5 % down towards 8 %. According to Eiendomsspar’s “Oslo Study”, approx. 650,000 sq.m. of office space is vacant.

• We expect a flat trend in office vacancy, with a t­endency of lower vacancies in the most attractive areas.

• Slow growth on the supply side. Low activity for new developments. In 2016, we expect the completion of approx. 120,000 sq.m. office space. For 2017, the prognosis indicates approximately 100,000 sq.m.

• Some commercial buildings are being converted into residential buildings and for other purposes. A portion of these buildings will therefore “fall out” of the market.

• The absorption in 2015 was approximately 151,000 sq.m. – down from about 181,000 sq.m. in 2014. On a

High

Moderate

CBD

4,650

2,650

Bjørvika

3,350

2,500

Sentrum

3,200

1,900

Kvadraturen

2,750

1,700

Skøyen

2,950

1,900

Lysaker

2,200

1,550

Nydalen

2,200

1,450

Bryn / Helsfyr

2,100

1,400

Hasle / Økern

2,150

1,100

Expected development

RENT LEVELS - TROMSØ OFFICE Area

Tromsø

High

Moderate

2,100

1,650

Expected development

Definition: High: High standard and prime location within the defined area.

Moderate: Moderate standard and location within the defined area.

6

Market Report 1 / 2016

RENT LEVELS - OSLO WAREHOUSE

side note, absorption has averaged 185,000 sq.m. per year since 1991.

• In conjunction with Oslo’s introduction of property tax on commercial property from 2017, there will be ­negotiations between landlords and tenants regarding who should pay the tax bill.

Type

Warehouse Category A

COMBINED BUILDINGS, WAREHOUSE/LOGISTICS AND INDUSTRIAL PREMISES • The market in Greater Oslo is still strong with firm rent ­levels and low vacancy. The conversion and d ­ evelopment in the Økern and Groruddalen area puts pressure ­especially on warehousing and logistics, and the ­alternatives to move elsewhere nearby are very limited.

• Demand for modern combination, warehouse and logistics facilities is expected to remain strong during the next 12 months.

• There are few modern and efficient premises available, which makes new developments the solution.

High

Moderate

1,250

750

High

Moderate

25,000

6,000

Expected development

RETAIL Submarket

Oslo -­ Category A

Expected development

Definition: High: High standard and prime location within the defined area.

Moderate: Moderate standard and location within the defined area.

Warehouse Category A: High standard and location within 30 km radius of the city center.

Retail Category A: Prime location in Oslo city center - Bogstadveien, Karl Johans gate, Nedre/Øvre Slottsgate, Aker Brygge, Vika.

RECENTLY SIGNED LEASE CONTRACTS Adress

Type

Tentant

Approx. sq.m

Karenslyst Allé 12-14*

Office

NorgesGruppen

14,461

Biskop Gunnerus' gate 14 (Posthuset)*

Office

Posten Norge

9,700

Biskop Gunnerus' gate 14 (Posthuset)*

Office

Jernbaneverket

7,800

Diagonale

Office

TV 2

6,000

Stenersgata 8

Office

Utlendingsdirektoratet (UDI)

4,158

Vitaminveien 1A

Office

GE Healthcare

3,500

Christian Kroghs gate 1-11

Office

Utlendingsdirektoratet (UDI)

3,285

Henrik Ibsens gate 100 (Indekshuset)**

Office

Gabler

3,100

Silurveien 2

Office

Universitetet i Oslo

2,599

Nydalsveien 28

Office

Itera

2,500

Filipstad Brygge 1

Office

CSC Norge

2,330

Vollsveien 6

Office

COOR Service Management

2,100

Nydalsveien 28

Office

Statnett

2,000

Warehouse/Logistics

OneMed AS

11,000

Bonntjennsveien v/Ullensaker

Warehouse

Home & Cottage AS

8,000

Drammensveien 145

Warehouse

IKEA

3,000

Fitness center

SiO Athletica

2,700

Bølerveien / Fuglesang Næringspak

Holbergs gate 21 *Extension of lease/renegotiation **Sublease

7

Market Report 1 / 2016

PROPERTY TAX INTRODUCED IN OSLO The new Oslo City Council has resolved to impose property tax, which will apply for residences from 2016 and for business properties from 2017. The Council has said that the tax rates will be kept moderate, but for how long? We take a look at the most important effects of introducing property tax in Oslo.

r­ egulations on valuation of properties in the Property Tax Act, but the tax base is limited upwards to the property’s market value. The tax base is, as a general rule, fixed for a period of 10 years.

Normally, the municipality establishes standardized guidelines for the valuation, which of course s­ ignificantly simplifies the process compared to doing a full and individual valuation of every single property. The dis­ advantage of such guidelines, however, is that the ­valuation is much “rougher” and less accurate.

MODERATE TAX RATE? In 2016, the tax rate has to start at 0.2 %, which is the lowest rate in the Property Tax Act. We don’t yet know the tax rate for 2017, but it is rumoured that the rate will be 0.3 % and that it will not increase beyond this level within the current City Council period. The owner of a business property valued at MNOK 70 should therefore prepare for a property tax of NOK 210 000 in 2017. ­Under no circumstance can the Oslo City Council increase the rate above 0.4 % in 2017, but it can increase it to the maximum rate of 0.7 % by the end of 2019. The tax bill for the same property could therefore rise to as much as NOK 490 000 per year. The City Council can choose to apply different tax rates to residences and business properties.

The Property Tax Act permits the council to design the guidelines as it wishes, and two kinds of guidelines are more frequently used than others: In one of them, the tax base is determined by assessing the value per m2 for d ­ ifferent kinds of building (office, storage, industry etc.), and adjusting this value for various factors such as location, age and condition. Another method is to determine an expected rental income per m2 (which will vary depending on, among other things, location and building type), which is then reduced for expected vacancy and owner costs. The net rental income is then capitalized, normally with the factor 10, in order to determine the property tax base.

TAXATION OF BUSINESS PROPERTIES POSTPONED TO 2017 The City Council’s primary aim is not to tax ­people’s houses, even though property tax in 2016 is only imposed on residences. The City Council has ­acknowledged that it will need all of 2016 to value the vast amount of business properties in Oslo and that it is not realistic to start taxing these properties until 2017.

The City Council has previously said that these valuations will start in “the first part of 2016” but, to our knowledge, they have not started yet.

Other methods and/or a combination of these methods are of course possible. Regardless of the method, it is important that the council’s guidelines don’t result in a tax base that is higher than the property’s market value.

UNFAIR VALUATIONS? A property’s value will depend on a number of factors, such as size, location, standard, rental income, rental period and “tenant quality”. No guidelines can properly take all relevant factors into account. The purpose of the guidelines is to simplify the valuations by only accounting for the key factors, so that the majority of properties are valued more or less correctly.

VALUATION OF BUSINESS PROPERTIES The tax base for property tax is determined by local tribunals based on proposals from professional assessors, who are required to physically visit and inspect all ­properties. Only the real property, i.e. the land and buildings, are subject to property tax – movables and i­ntangible assets are not. There are no detailed

Inevitably, there will be both losers and winners in this picture. We consider it likely that the most attractive business properties in Oslo will receive a larger “discount” compared to market value than properties deemed less 8

Market Report 1 / 2016

INDUSTRIAL PROPERTIES A subcategory of business properties is the so-called “verk og bruk”. This is not a uniform group of properties but typically comprises industrial sites and production facilities. These properties will be taxed not only on land and buildings but also on production facilities that are deemed to form part of the real property (fixtures). These properties are not normally valued using the g ­ uidelines mentioned above, but on the basis of a t­ echnical ­value. This approach can mean that, in particular, old industrial properties with low profitability can be hit unreasonably hard.

attractive due to e.g. short leases or risk of high v­ acancy.

This may seem unfair, but as long as the differences are limited and the rules are applied equally to all tax­ payers, the non-discrimination principle will normally not be violated.

We assume that Oslo municipality will aim toward rather conservative valuations in the hope of limiting the ­number of appeals. If our assumption is correct, the tax base for prime yield properties could become quite reasonable.

WHO PAYS THE TAX BILL? In most standard lease agreements for business ­premises, the obligation to pay property tax lies with the owner. In practice, however, we often see leases that ­deviate from the standards and that either explicitly impose the obligation to pay property tax on the tenant or are silent on the matter. As a general rule, if the lease is silent on the matter, the obligation to pay the property tax will be deemed to lie with the owner.

PROPERTY TAX ON RESIDENCES Residences will be subject to property tax already in 2016. This is made possible because Oslo City ­Council has decided to use the tax authorities’ tax value of ­residences as the tax base for property tax, which ­significantly simplifies the valuation process. Never­ theless, there are quite a few properties that have to be valued and there are speculations about whether there will be enough time to finish the valuation process before the deadline of 30 June 2016. If not, taxation of ­residences will also have to be postponed until 2017.

In lease agreements, the parties are free to decide who shall pay the property tax or to divide the liability ­between them.

By using the tax authorities’ tax value, the property tax assessment will equal approximately 80 % of the market value of the residence. Unlike for business properties, the property tax assessment will be amended each year in accordance with the price development in the housing market.

Following the introduction of property tax in Oslo, an interesting question is whether there can be grounds for renegotiating the provisions of the lease on liability for property tax. Renegotiation can be particularly relevant if the term of the lease is due to expire before property tax on business properties is introduced in 2017.

Kristian Råum Attorney-at-law/Senior Manager, Ernst & Young Tax & Law

Landlords should be aware that the council’s claim for property tax is automatically secured by a statutory pledge on the property, which has priority over any other claim, and that the council can foreclose on the property in order to collect the tax. The owner therefore bears the ultimate risk if a tenant fails to settle his contractual property tax liability.

Morten Christophersen Attorney-at-law/Senior Manager, Ernst & Young Tax & Law 9

Market Report 1 / 2016

DISRUPT OR BE DISRUPTED Imagine a reality where you wake up in the morning and the screen beside your bed tells you that you will get a flu in 72 hours. Based on your ­symptoms throughout the night, and a comparison with 172 million other people with similar signs, there is a 92.7 % chance that you will catch the bug. However, if you go to your family physician today and and get a shot today, then perhaps you can beat it.

changing reality and only those who take the lead in that change will be around to enjoy it. So ask yourself, what would Uber do if they entered your business? Should you disrupt your own business, or just let someone else do it for you? The answer is simple, the solution is hard.

BRING ON THE PERSONAL TRAINERS

You take your phone out and book the car for your ­doctor’s visit. Private cars have been banned for years, but you subscribe to a service that administers 30,000 electric self driving cars. It’s cheaper, safer and better for all. On the way to your doctor’s office you smile and think of the time when you used to drive your own car. How stupid. How dangerous.

Job

Probability

Recreational therapists

0.003

Dentists

0.004

Athletic trainers

0.007

According to Singularity University, www.singularityu.org, the world stands on the brink of a gigantic paradigm shift.

In the next decade major businesses will disappear and be replaced by other, more innovative companies and business models. 2 billion jobs are expected todisappear while 4 billion other jobs will be created. The question is whether any of the 2 billion who lost their jobs will have any chance at getting any of the 4 billion new jobs.

Clergy

0.008

This table appeared in The Economist in 2014. It shows with a degree of certainty what kind of jobs will be ­obsolete and which will not. It does not surprise many that jobs that can be easily automated are in trouble.

However, many might raise their eyebrows to the news that there is an 86 % probability that real estate agents will be automated. When I mention this in my lectures, the audience usually laughs or applauds. I find that sympto­ matic of a profession that is living on borrowed time.

It is expected that the rate of technological innovation will explode into exponential proportions over the next decade. Our children are likely to see more technological break throughs in a week than our parents experienced in a lifetime. As our generation might be the first ever who cannot rely on our own parents for work related advice, beside ethical and moral questions, we need to seek out future employees who not only embrace change, but who initiate it. These are the students who keenly understand that what the universities teach, has been outdated for decades. They make themselves attractive by becoming ultra fast learners with a flexible mindset that today’s workforce can only dream of.

Chemical engineers

0.02

Editors

0.06

Firefighters

0.17

Actors

0.37

Health technologists

0.40

Economists

0.43

Commercial pilots

0.55

Machinists

0.65

Word processors and typists

0.81

Real estate sales agents

0.86

Technical writers

0.89

Retail salespersons

0.92

Accountants and auditors

0.94

Telemarketers

0.99

Probability that computerisation will lead to job losses within the next two decades, 2013 (1=certain)

Jan Grønbech Country Director, Google Norge

Nobody holds all the answers to what the future will be like. One thing is for sure, though. It will be a rapidly 10

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