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HCMC PROPERTY MARKET: A LOOK BACK AT 2017 AND OUTLOOK FOR 2018
• Investment
• Office Market
• Retail Market
• Hospitality Market
• Condominium Market
PANEL DISCUSSION
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INVESTMENT
HCMC: Transactions in the Last Two Years - CBD was the Most Sought After
Project Buyer Seller
Saigon Green
1 Novotel Saigon Liberty Group
View Investment
Kumho Asiana
2 Kumho Asiana Plaza Mapletree
Saigon
Saigon
3 Saigon Metropolitan Indochina Group
Metropolitan Tower
Hong Phuc Quang
4 Senla Boutique Hotel Diep Bach Duong
RE.
5 Lim Tower Gaw Capital Hoa Lam
A plot in Vinhomes
6 CapitaLand Vingroup
Golden River
1 7 Le Meridien Mitsubishi Tien Phuoc
6
5 8 Saigon Center Keppel Land Watco
2
7 9 Duxton Hotel Saigon Confidential Low Keng Huat
3 4
Nguyen Dinh Chieu
10 Novaland NA
Site
10 8
9 11 A&B Tower Fujita A&B Development
11 HCMC People’s
12 Tran Hung Dao Site Confidential
Committee
12
Source: RCA, CBRE Vietnam. TOTAL TRANSACTED VALUE: ~US$1.2 billion
INVESTMENT
Hanoi: Transactions in the Last Two Years – Scattered Around the City
Project Buyer Seller
Nam Thang Long
1 Ciputra Mall Lotte Group
Urban
2 Kosmo Tay Ho NA NEWTATCO
3 Sedona Suites BRG Group Keppel Corp.
Dolphin 2
6 Dolphin Plaza TID Corp.
4 Vietnam
6 5 7 International Centre Hotel Vincapital Keppel Corp.
7
8 8 Sofitel Legend Metropole Hanoi NA Vincapital
9 10 Growing Sun
9 Diamond Rice Flower Kinh Bac Corp.
Investment
Elite Capital
10 Hanoi Times Square VinaLand
Resources
11 12 13 11 Usilk City CT1-104 Hai Phat Song Da – Thang Long
45,000 Valuation
40,000
Hanoi and HCMC
35,000
Transparency
30,000
25,000
20,000 Structuring
15,000
10,000
5,000 Track record
0
Hong Kong
Philippines
Thailand
Singapore
Vietnam
Taiwan
2016 2017
Disclaimer: Transactions include deals above US$10 million. Information contained herein, including projections, has been obtained from sources believed to be
reliable. While we do not doubt its accuracy, we have not verified it and make no guarantee, warranty or representation about it. It is your responsibility to confirm
independently its accuracy and completeness. This information is presented exclusively for use by CBRE clients and professionals and all rights to the material are
reserved and cannot be reproduced without prior written permission of CBRE.
INVESTMENT
Residential transactions in 2017 included Galaxy Residence, Dai Phuoc Loctus and The EverRich 3, which were partly under operation.
Source: RCA. 8
INVESTMENT
* Survey of 600 respondents including investors, fund managers, developers, property companies, lenders, brokers, advisers and consultants.
Source: PwC, Emerging Trends in Real Estate Asia Pacific 2018 Survey. 9
HCMC OFFICE
2 Performance Edging Up
11
HCMC OFFICE
GRADE A GRADE B
8.2% 2.8%
► 0.2 ppt y-o-y ► 0.1 ppt y-o-y
▲ 1.6 ppts q-o-q Vacancy rate ► 0 ppt q-o-q
(*) Asking rents: US$ psm pm (exclusive of VAT & Service Charge)
Source: CBRE Vietnam, Q4 2017.
12
HCMC OFFICE
Grade A Grade B
Etown Central
36,450 sm NLA
HCMC OFFICE
1,400,000 100%
1,200,000 80%
1,000,000
NLA (sm)
60%
NLA (sm)
800,000
600,000 40%
400,000
20%
200,000
0 0%
2012 2013 2014 2015 2016 2017 2012 2013 2014 2015 2016 2017
CBD District 1 - Non-CBD District 7
Existing Supply New Supply
Tan Binh District District 3 District 10
District 4 Others
35
Asking Rent
30
25
20
2012 2013 2014 2015 2016 2017
Grade B
30 US$21.1
(US$/sm/month)
25
Asking Rent
20
15
10
2012 2013 2014 2015 2016 2017
(*) Asking rents: US$ psm pm (exclusive of VAT & Service Charge)
15
Source: CBRE Vietnam, Q4 2017.
HCMC OFFICE
GRADE A GRADE B
2016
2015
2014
2013
2012
100% 80% 60% 40% 20% 0% 0% 20% 40% 60% 80% 100%
Source: CBRE Vietnam, Q4 2017. Q4 performance data represents the whole year. .
16
.
HCMC OFFICE
2%
15% Relocation
34% 11% 9%
New Letting Services Manufacturing IT
16%
Expansion
67%
Renewal
HCMC OFFICE
HCMC OFFICE
Diamond Plaza
Manufacturing
600 sm
2,000 10
No. of Enquiries
8
Leasing size
1,500
(NLA sm)
6
1,000
4
500 2
0 0
2015 2016 2017
Average size required Number of enquries
Source: CBRE Vietnam, Q4 2017.
HCMC OFFICE
Future Supply 1 2
2018 Outlook
Supply Outlook
300,000 Forecast
Grade A Grade B
NLA (sm)
200,000
100,000
0
2010 2011 2012 2013 2014 2015 2016 2017 2018F 2019F 2020F
50 10%
(US$/sm/month)
30 6%
20 4%
10 2%
0%
0
2015 2016 2017 2018F 2019F 2020F
2015 2016 2017 2018F 2019F 2020F
23
Source: CBRE Vietnam, Q4 2017.
HCMC OFFICE
2018 Trends
Going Green
Buildings Changing Ownership:
Continuous upgrading from
Leading to restructuring tenant mix and higher rent
old buildings
P.L.A.C.E Making
Happening to traditional tenants
Co-Working Space:
Moving to Retail Podium for Larger Space
24
Source: CBRE Vietnam, Q4 2017.
HCMC RETAIL
7 new projects
No new supply C
74,183 sm NLA
New Supply
US$115.4 US$37.8
▲ 1.2 % y-o-y ▲ 3.8% y-o-y
► 0% q-o-q Asking Rents (*) ► 0% q-o-q
2.7% 6.9%
▼ 2.3 ppts y-o-y ► 0 ppts y-o-y
▼ 0.2 ppts q-o-q ▼ 6.1 ppts q-o-q
Vacancy Rate
(*) Asking rents: US$ psm pm (exclusive of VAT & Service Charge)
Source: CBRE Vietnam, Q4 2017.
27
HCMC RETAIL
Pearl Center
RomeA Shopping 20,000 sm NLA
Centre, 9,661 sm NLA
Vincom Plus
Homyland
The Garden Mall Source: CBRE Vietnam, Q4 2017.
Vincom Plaza SaigonRes 1,400 sm NLA
13,300 sm NLA
5,822 sm NLA
HCMC RETAIL
1,000,000 100%
90%
800,000 80%
NLA (sm)
70%
600,000
60%
NLA (sm)
400,000 50%
40%
200,000 30%
20%
0
2012 2013 2014 2015 2016 2017 10%
0%
Existing Supply New Supply 2012 2013 2014 2015 2016 2017
2012 - 2014: +4% / year CBD - District 1 District 2 Tan Phu District
2015 - 2016: 29% / year Go Vap District Binh Tan District Tan Binh District
2017: +7% District 9 District 7 Others
HCMC RETAIL
120
Asking Rent
80
40
0
2012 2013 2014 2015 2016 2017
Non-CBD US$37.8
40
(US$/sm/month)
Asking Rent
30
20
10
0
2012 2013 2014 2015 2016 2017
Source: CBRE Vietnam, Q4 2017.
(*) Asking rents: US$ psm pm (exclusive of VAT, service charge)
30
HCMC RETAIL
CBD NON-CBD
2016
2015
2014
2013
2012
100% 80% 60% 40% 20% 0% 0% 20% 40% 60% 80% 100%
HCMC RETAIL
HCMC Net Absorption by Year Market was busy with new fashion and F&B brands
New Entrants Incoming
2017
2016
F&B
2015
NLA (sm)
2014
Fashion
2013
2012
- 80,000 160,000
Cosmetics
4.0 2.0%
Revenue % of Retail Revenue
% of Retail Revenue
Revenue (Billion US$)
3.0 1.5%
2.0 1.0%
1.0 0.5%
0.0 0.0%
2012 2014 2016 2018 2020
HCMC RETAIL
14%
12%
10%
8%
6%
4%
2%
0%
China Vietnam Malaysia India Thailand Philippines Hong Kong Indonesia Taiwan US South
Korea
Source: Oxford Economics, Deloitte – Asia Pacific Economic Outlook 2017
34
HCMC RETAIL
Growth in number of middle class households vs Average annual growth in real disposable income
HCMC RETAIL
Future Supply 1
3
5
1. Van Hanh Mall, D10 – NLA: 60,000 sm
2. Saigon Co.op, Thu Duc – NLA: 67,200 sm 4
2
3. Union Square, D1 – NLA: 22,800 sm
4. Landmark 81, Binh Thanh – NLA: 33,920 sm
5. Estella Place, D2 – NLA: 26,004 sm
2018 Outlook: Positive for CBD while non-CBD Under Pressure of Rising Supply from Retail Podiums
Supply Outlook
Forecast
300,000
CBD Non-CBD
NLA (sm)
200,000
100,000
0
2010 2011 2012 2013 2014 2015 2016 2017 2018F 2019F 2020F
160 25%
(US$/sm/month)
Vacancy Rate
Asking Rent
20%
120
15%
80
10%
40 5%
- 0%
2015 2016 2017 2018F 2019F 2020F 2015 2016 2017 2018F 2019F 2020F
Source: CBRE Vietnam, Q4 2017. 37
HCMC RETAIL
2018 Trends
38
SECOND HOME MARKET
7,000,000
2014 2015 2016 2017
6,000,000
International Arrivals
5,000,000
4,000,000
3,000,000
2,000,000
1,000,000
0
HCMC Hanoi Da Nang Nha Trang Phu Quoc
Source: Tourism Departments of various cities, CBRE Vietnam, Q4 2017
41
VIETNAM’S TOURISM
Korea ▲ 56.4%
China
China ▲ 48.6%
30% Korea
31%
Japan Hong Kong ▲ 37.9%
Taiwan
Daegu Seoul
Total International
Zhengzhou Airport New Flights in 2017
Russia Destinations
Guangzhou
Cam Ranh 26 cities 2 new flights
DA NANG
Bangkok
NHA TRANG
Van Don Phu Quoc International
International Airport Passenger Port (Duong Dong)
Kuala Lumpur
PHU QUOC To be completed 2020
Chartered flights To be completed 2018
Direct flight
Source: Vietnam National Administration of Tourism.
43
VIETNAM’S TOURISM
2017 vs. 2016 Nha Trang: x 1.3 Da Nang: x 1.2 Phu Quoc: x 2.6
14,000
Accumulated Supply
12,000
(Number of Units)
10,000
8,000
6,000
4,000
2,000
-
2014 2015 2016 2017 2014 2015 2016 2017 2014 2015 2016 2017
Nha Trang Da Nang Phu Quoc
45
2017 vs. 2016 Nha Trang: x 1.2 Da Nang: x 1.1 Phu Quoc: x 1.6
2,500
Accumulated unit
2,000
1,500
1,000
500
-
2014 2015 2016 2017 2014 2015 2016 2017 2014 2015 2016 2017
Nha Trang Da Nang Phu Quoc
NORTH
Condo-tel Price (US$/sm, excluding VAT) Vacation Villa Price (US$/GFA sm, excluding VAT)
3,000 3,000
Price of Condo-tel (US$/sm)
2,500 2,500
(US$/sm)
2,000 2,000
1,500 1,500
1,000 1,000
500 500
0 0
2015 2016 2017 2015 2016 2017
PHU
PHUKET
QUOC
Vacation Villa Vacation Villa
•Rental Yields: 6-9% •Rental Yields: 4-6%
•Guaranteed Yields: 8-10% •Guaranteed Yields: 6-7% (5-
(5-10 years) 15 years)
HOSPITALITY MARKET
Total leasable stock in Nha Trang by 2020: 2017: 24,785 keys By 2020: 34,249 keys
(hotel* + condo-tel + villa) launched keys
20
1 3 7 8 9 10 12 16 17 19
22
23 2 4 5 6 11 13 14 15 18
21
1 Vinpearl Beachfront Condotel - 40Fl 7 Panorama Condotel - 39Fl 13 The Costa-InterCon Hotel - 19Fl-29Fl 19 Royal Marina Complex - 32Flx2
2 Starcity Nha Trang - 21Fl 8 AB Central Square - 36Fl 14 Sheraton Hotel - 33Fl 20 Marriott Courtyard Hòn Tằm
Hyatt Regency Cam Ranh Bay resort &
3 Citadines Bayfront Nha Trang - 26Fl 9 Vinpearl Empire - 41Fl 15 Nha Trang Center - 20Fl 21
spa
4 Muong Thanh Luxury Hotel - 45Fl 10 Tropicana - 49Fl x 2 16 Gold Coast Condotel - 40Flx2 22 Radisson Blu Cam Ranh Bay
5 Novotel Hotel - 18Fl 11 Havana Nha Trang Plaza - 42Fl 17 Ocean Gate - 40Fl 23 Manna Luxury Holiday Resort
6 Ibis Styles Hotel - 25Fl 12 Ariyana Smart Condotel - 28Fl 18 Muong Thanh Grand Hotel - 48Fl
Total leasable stock in Da Nang by 2020: 2017: 18,050 keys By 2020: 34,599 keys
(hotel* + condo-tel + villa) launched keys
16 17
1 3 5 6 7 14
18 13
9 19 20
22 8
2 4 12 15
11
21
10
Total leasable stock in Phu Quoc by 2020: 2017: 5,639 keys By 2020: 15,600 keys
(hotel* + condo-tel + villa) launched keys
6 16 19
3
4 8 11
1 2 5 7 9 10 12 13 14 15 17 18
Source: CBRE Vietnam
* Only 4-5 star hotels Existing projects Future Projects
.
1 Vinpearl Phu Quoc Resort 6 Movenpick Phu Quoc 11 Salinda Phu Quoc 16 InterContinental Phu Quoc
2 Vinpearl Villa Phu Quoc 7 Chen Sea Resort 12 Mercure Phu Quoc 17 JW Marriott Phu Quoc
3 Crowne Plaza Phu Quoc Starbay 8 The Shells 13 Sol Beach House Phu Quoc 18 Premier Village Phu Quoc
4 Nam Nghi 9 La Veranda Resort 14 Sonasea Villas & Resort 19 Hon Thom Resort
5 Fusion Resort Phu Quoc 10 Long Beach Resort 15 Sunset Sanato Resort 20
HOSPITALITY MARKET
2018 Trends
1 Drop in Launches
56
HCMC CONDOMINIUM
HCMC CONDOMINIUM
Interest 6.5%
35,000
30,000
25,000
-50% y-o-y
20,000
Inflation 19%
15,000 Interest 14%
10,000
5,000
0
2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017
Luxury High-end Mid-end Affordable
31,106 units were launched in 2017: lower than the past two years but still higher than
5-year average (increase by 65% from 2014)
Source: CBRE Vietnam Q4 2017. 58
HCMC CONDOMINIUM
100%
20%
80%
36% High-end
20%
0% Batdongsan.com.vn
2007 2015 2016 2017
11M/2017: From a total of 86 million search
Luxury High-end Mid-end Affordable
visitors, 44% looked for mid-end condominium
Source: CBRE Vietnam, Q4 2017.
Source: VRES
59
HCMC CONDOMINIUM
THE EAST
35% of Accumulated Supply
CAGR (2014-2017): 22%
CAGR (2017-2020F): 12%
Binh Thanh
District 1
District 4 District 7
THE SOUTH
31% of Accumulated Supply
CAGR (2014-2017): 18%
CAGR (2017-2020F): 10%
60
Binh Chanh
HCMC CONDOMINIUM
78%
84%
89%
HCMC CONDOMINIUM
Sold Units: Decreased from Last Year, but for the First Time Number of Sold Units Higher than New
Launch Supply
Number of sold units
40,000
-5% y-o-y
35,000
30,000
25,000
Sold units
Affordable
ABSORPTION RATE Mid-end
in Newly Launched High-end
Projects Luxury
0% 10% 20% 30% 40% 50% 60% 70% 80% 90%
62
Source: CBRE Vietnam, Q4 2017.
HCMC CONDOMINIUM
4,000
3,000
2,000
1,000
0
2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017
Luxury High-end Mid-end Affordable
(*) Selling price excludes VAT and quotes on NSA
HCMC CONDOMINIUM
Primary Selling Price: Binh Thanh, District 4 and District 2 saw the highest growth
Binh Thanh
District 2
3,000
2,500
Primary price
14% 4%
(US$/sm)
Primary price
2,000 2,000
(US$/sm)
1,500
1,000 1,000
500
0
0
2014 2015 2016 2017
2014 2015 2016 2017
High-end Mid-end
High-end Mid-end
District 4 District 7
2,500 2,500
2,000 6% 2,000 0%
Primary price
Primary price
1,500
(US$/sm)
(US$/sm)
1,500
1,000 1,000
500 500
0
0
-500 2014 2015 2016 2017
2014 2015 2016 2017
High-end Mid-end High-end Mid-end
Source: CBRE Vietnam Q4 2017. 64
Selling price excludes VAT and quotes on NSA
HCMC CONDOMINIUM
20,000 6%
15,000 5%
10,000
4%
5,000
0 3%
2014 2015 2016 2017 2018f 2019f 2020f 2015 2016 2017
65
HCMC CONDOMINIUM
50%
14% 9%
40%
30%
6% 8%
20%
6% 8% 10%
0%
5% 8% >60 sm 60 - 90 sm > 90 sm
(*) Note: The analysis above is based on CBRE Vietnam’s residential closed
deals and should not be used as a marketwise benchmark
Source: CBRE Vietnam Q4 2017.
HCMC CONDOMINIUM
67 projects 1
36,122 units
53% in Mid-end, 33% in 4
6
High-end
1 3
1 1
1 14
5
1
1
1
3
5
12
4
3
Source: CBRE Vietnam Q4 2017. • Bubble size: size of new launch supply in that district
• Number in the bubble illustrates the number of 67
projects launched in the period
HCMC CONDOMINIUM
New Launch Supply Will Be Higher Than 2017 While Sold Units Will Be Stable
New launch supply by year Sold unit by year
40,000 35,000
New launch supply (units)
35,000 30,000
30,000
25,000
Sold units
25,000
20,000
20,000
15,000
15,000
10,000 10,000
5,000 5,000
0 0
2012
2013
2014
2015
2016
2017
2012
2013
2014
2015
2016
2017
2018F
2019F
2020F
2018F
2019F
2020F
68
HCMC CONDOMINIUM
6,000 Forecast
5,000
Primary price (US$/sm)
4,000
3,000
2,000
1,000
0
2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018F 2019F 2020F
Luxury High-end Mid-end Affordable
69
HCMC CONDOMINIUM
2018 trends
Strenthening of
Big Data and Market Intelligence Urban Regeneration
Township Developments
Material Marketing and Branding matters even more (make better use of
Customization technology)
The rise of Thu Thiem Luxury - Be careful what you wish for!
Traffic jams continue as car/bike sales hike while roads do not increase and 2,000 babies
are born every week in HCMC
70
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Thank You
All materials presented in this report, unless specifically indicated otherwise, is under copyright and proprietary to CBRE.
Information contained herein, including projections, has been obtained from materials and sources believed to be reliable at the
date of publication. While we do not doubt its accuracy, we have not verified it and make no guarantee, warranty or
representation about it. Readers are responsible for independently assessing the relevance, accuracy, completeness and
currency of the information of this publication. This report is presented for information purposes only, exclusively for CBRE clients
and professionals, and is not to be used or considered as an offer or the solicitation of an offer to sell or buy or subscribe for
securities or other financial instruments. All rights to the material are reserved and none of the material, nor its content, nor any
copy of it, may be altered in any way, transmitted to, copied or distributed to any other party without prior express written
permission of CBRE. Any unauthorised publication or redistribution of CBRE research reports is prohibited. CBRE will not be liable for
any loss, damage, cost or expense incurred or arising by reason of any person using or relying on information in this publication.
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