Post on 27-Jan-2015
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4Q 2013 | VIETNAM OVERVIEW
KNOWLEDGE REpORtvietnam
www.colliers.com/vietnam
EcONOmy Of ViEtNam• Vietnam’s economy shows signs of recover• positive changes in real estate market regulations• increase foreign shares in local banks
HO cHi miNH city’ s EcONOmic UpDatEHO cHi miNH city iNfRastRUctURE UpDatEHaNOi’ s EcONOmic aND iNfRastRUctURE UpDatEHO cHi miNH city pROpERty maRKEt
Office• market Overview• market insight• forecastRetail• market Overview• market insight• forecastResidential• market Overview• market insight• forecast
sOUtHERN iNDUstRiaL maRKEtHaNOi pROpERty maRKEt
Office• market Overview• market insight• forecastRetail• market Overview• market insight• forecastResidential• market Overview• market insight• forecast
tabLE Of cONtENts
ViEtNam pROpERty maRKEt at a GLaNcE
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VIETNAM | 4Q 2013 | ECONOMIC UPDATE
p.1 | colliers international
ViEtNam’ s cpi mONtH-ON-mONtH
REGistERED & DisbURsED fDi
source: GsO, colliers international
Vietnam’s economy shows signs of recovery
> The new Land Law is expected to have a practical impact on land ownership, land recovery, compensation for site clear-
ance, resettlement and the establishment of independent agencies for land appraisal.
> One of the main causes of the economic turmoil is local banking system with major issues in bad debt and liquidity. And
the increase in foreign shares is expected to support recapitalization and restructure of local commercial banks.
> However, 20% of stake does not provide efficient control for foreign investors to get involved in the restructure process.
Then the local banking system will not experience big impacts from merger and acquisition activities during this year.
positive changes in real estate market regulations > in 2013, the new Land Law was officially approved by the
National assembly.
> condominium inventory has decreased more than 26% to
that in the first quarter of 2013, mainly in the small- and
medium-sized at affordable apartment segment.
> the average price of all sectors throughout 2013 slightly
rose but still are 10% - 30% lower than the peaks gained in
2008 - 2010.
> throughout 2013, the total investment capital of the real estate
projects continued increasing to Us$951 million in 2013.
increase foreign shares in local banks
> the Government issued Decree 01/2014 on lifting foreign
ownership cap in local credit institutions.
> a single foreign strategic investor can hold up to 20% of
stake in local banks, up from the current 15%.
> total ownership of foreign investors cannot exceed 30%
of chartered capital of a commercial bank in Vietnam.
VIETNAM 2013 Y-o-Y 2014FGDP Growth 5.42% 0.39%
Registered FDI (US$ billion) 21.6 54.5%
Exports (US$ billion) 132.2 15.4%
Imports (US$ billion) 131.3 15.4%
CPI 6.6% -2.6%
Total retail sales (VND billion) 2,618 12.6%
International Visitors (million) 7.57 10.6%
Base Rate 9% 1.56%
Exchange Rate 21,070 1.1%
VN-Index 504.63 22%
Gold Price (VND million/ tael) 34,780 -24.4%
source: colliers international
source: GsO, colliers international
Forecast > The inflation rate is expected to reach around 7% in 2014
given higher targeted growth rate of 5.8% and loosen of
public investments.
> It is necessary to keep increasing the growth rate at an
appropriate inflation rate.
> Restructure of banking system and state-owned groups
remain hot spots of the economy in 2014.
HO CHI MINH & HA NOI | 4Q 2013 | ECONOMIC UPDATE
p.2 | colliers international
Hcmc - HaNOi GDp GROWtH RatEHcmc - HaNOi cpi GROWtH by mONtH
source: GsO, colliers international
forecast > In 2014, HCMC will shift FDI attraction to green
technology, hi-technology, and capital-intensive
sectors, while discourage polluted FDI projects and
firms employing obsolete technologies regarding
improvements of the Investment Law and Enterprise
Law.
Hcmc economy is stable with bright prospect in 2014
HO CHI MINH CITY | 4Q 2013 | INFRASTRUCTURE
HO CHI MINH CITY 2013 Y-o-Y 2014FGDP Growth 9.3% 0.1%
Registered FDI (US$ billion) 1.55 28.6%
Exports (US$ million) 26.5 -6.0%
Imports (US$ million) 25.8 14.9%
CPI 3.7% -0.37%
Total retail sales (VND billion) 606.9 12.6%
International Visitors (million) 4.1 8.1%
source: GsO, colliers international
source: GsO, colliers international
Ha Noi city set lowest fDi target in the past 2 years
HA NOI 2013 Y-o-Y 2014FGDP Growth 8.25% 0.15%
Registered FDI (US$ billion) 1.02 -7%
Exports (US$ million) 10.3 0.2%
Imports (US$ million) 23.6 -3.7%
CPI 6.37% 0.08%
International Visitors (million) 1.8 15.2%
> Last year, Ha Noi city attracted registered fDi
of almost Us$1.02 billion, or about 87.2% of the
annual target.
> Hanoi city also set a goal of attracting Us$1.3
billion in fDi in 2014, despite failing to meet its
annual fDi targets over the past two years.
source: GsO, colliers international
HO CHI MINH & HA NOI | 4Q 2013 | ECONOMIC UPDATE HO CHI MINH CITY | 4Q 2013 | INFRASTRUCTURE
D e s p i t e g l o o my e co n o m i c co n d i t i o n i n V i e t n a m a n d
t i g h t e n p o l i c i e s i n p u b l i c i n ve s t m e n t , t h e re h a s b e e n
n o t a b l e i n f ra s t r u c t u re i m p rove m e n t s i n 2 0 1 3 i n H c m c .
> finishing of 6 flyover bridges at major traffic nodes scattered all
over the city.
> saigon bridge 2 completed after 18 months of construction, 3
months earlier than schedule.
> the opening of the 1st phase of tan son Nhat - binh Loi - Outer
Ring Road.
> Hcmc-Long thanh-Dau Giay expressway also finally opened since
commencement in 2009.
the open of vital infrastructure projects is expected to improve
traffic connectivity between the city and its fringe.
future infrastructure developments
tunnels at an suong (District 12) and thu Duc (thu Duc District)
crossroads are being processed to enhance infrastructure at the city
entrance. besides, the city agencies also boost development of the
Urban Drainage system (sponsored by World bank). this historically
is one of the biggest issues facing.
Regarding priority projects of the city, construction on the proposed
metro Rail and bus Rapid transit has resumed after prolonged delay
due to obstacles in site clearance and compensation. meanwhile, thu
thiem new urban area re-starts construction of 4 internal roads
which are scheduled to complete in 2016.
p.3 | colliers international
saiGON bRiDGE 2 paRaLLELED WitH EXistiNG ONE
fLyOVER bRiDGEs cOmpLEtED iN Hcmc iN 2013
Hcmc - LONG tHaNH - DaU Giay EXpREssWay
pHasE 1 Of tsN - biNH LOi - OUtER RiNG ROaD
source: public Domain, colliers international
source: public Domain, colliers international
source: public Domain, colliers international
source: public Domain, colliers international
Market Insight > though the effectiveness of flyover projects is controversial, the
endeavour of local officials is undoubted. six more bridges are
planned to be built in 2014 are hoped to provide more visible
results in reducing traffic congestions beside short construction
time and low capital investment advantage.
> Hcmc authority is encouraging private investment to infrastructure
in ppp scheme.
> phu my bridge connecting District 2 and District 7 is an example
of a ppp developments.
convenient access and fluent traffic flow
HO CHI MINH CITY & HANOI | 4Q 2013 | INFRASTRUCTURE
p.4 | colliers international
source: public Domain
mastER pLaN Of iNtERNaL ROaDs @ tHU tHiEm > Expected to rep lace ex is t ing bu i ld-Operat ion-transfer
(bOt) and bu i ld-transfer (bt) forms , the ppp scheme
requ ires increas ing respons ib i l i ty and invo lvement o f
the government in shar ing d i ff icu l t ies in s i te c learance ,
compensat ion and main tenance of the pro jec ts in order
to enhance construct ion progress and qua l i ty .
> the government has approved the “master plan of Economic
and society development of Hcmc to 2020, vision to 2025”
that administratively subdivide the city into 6 areas including
city center, thu thiem new urban area and 4 other suburbans.
Regarding economic sections, there will be urban and suburban
zones, industrial zones, ecological tourism zones, agricultural
zones and reservation zones.
> this is expected to encourage development of current investors
and attract interest of potential developers with identified master
plan and apparent investment policies.
the highlight points in the old cbD are Ring Roads 1 and 2. the construction of
O cho Dua – Hoang cau path has been boost in order to open before Lunar New
year, whereas the clearance plan for O Dong mac – Nguyen Khoai path has been
approved. the resettlement payment was expected to finish in Q4/2013 so that the
clearance would start at the beginning of 2014.
besides, the song Lu – ton that tung path connecting Nga tu so and Nga tu Vong
was also under construction whistle the site clearance was hastened.
in the new expansion area of Hanoi, the National Road No.5 prolong is one of the
focusing projects with numerous support from Hanoi’s people committee.
in December 2013, Hall E, the expansion of t1 terminal at Noi bai international
airport, was inaugurated to catch up with the rapid increasing of travelers during
tet holiday while the construction of t2 terminal was also speed up.
Hanoi speed up most of its under-construction or pending projects
> in December 2013, Hanoi’s people committee has approved the establishment of the two districts named bac tu Liem and Nam tu
Liem which are divided from tu Liem district.
> from a suburban one, tu Liem has been split into two urban districts. the bac tu Liem is the North of the current tu Liem, covering
an area of 4,355 ha with a population of approx. 320,000 people. it contains nine current communes of tu Liem and a part of cau
Dien town which would be reassigned into 13 wards. the Nam tu Liem is the south of current tu Liem, covering 3,227 ha and having
a population of 233,000 people. the current communes (of tu Liem) now belonging to Nam tu Liem would be divided into 10 wards.
NEW mastER pLaN Of tU LiEm DistRict
source: public Domain
HO CHI MINH CITY | 4Q 2013 | PROPERTY MARKET
HO CHI MINH CITY | 4Q 2013 | PROPERTY MARKET
HCmC Property market Overview
HO CHI MINH CITY | 4Q 2013 | OFFICE MARKET
p.6 | colliers international
GRaDE a pERfORmaNcE, 4Q 2013
GRaDE b pERfORmaNcE, 4Q 2013source: colliers international
source: colliers international
pREsiDENt pLacE: LEED GOLD bUiLDiNG
source: UsGc
Forecast > It is expected that Grade A developments will maintain and increase
rental rates; with a steady gain of 2% to 3% quarterly.
> Meanwhile, occupancy rate is expected to fluctuate moderately.
> The 8% increase in total floor areas from future supply in 2014
is expected to get efficient take-up from current market demand.
Premium location and extensive floor plan are preferable elements
of these new buildings.
stability in top-tier buildings HO CHI MINH CITY | 4Q 2013 | OFFICE MARKET
p.7 | colliers international
> the median rentals of Grade a office buildings in Hcmc gained 3%
while occupancy rate also rised 3% q-o-q.
> after a reduction in rents offered of 2.3%, Grade b developments
experienced similar growth rate in occupancy.
> in 2014, the market will receive gradual supply. around 75,000 net
sq m. of commercial office space will enter the market, from Grade
a and top-tier Grade b projects.
Market Insight > Land lords o f Grade b deve lopments w i l l need to app ly
var i e ty o f s t ra teg ies inc lud ing pr i c ing and renova t i on
in order to re ta in ex i s t i ng tenan ts . those bu i l d ings are
under pressure in d i s t i ngu ish themse lves f rom huge
Grade c supp ly w i th aggress ive pr i c ing s t ra teg ies .
> Office developments will need to continue offering distincted incentives
such as prestigious location and provide added values to their buildings
as competitive advantages. international management, iconic design
and special building features and effective rentals are needed in
building owners strategies.
> an example can be seen in president place being the first LEED
(Leadership in Energy and Environmental Design) Gold building in
town. Green building is actually not a new concept but still get low
aweness from local market.
> although most of the current green certificate application is
for sales and marketing strategies, actual energy efficiency and
cost savings will soon be demand drivers allowing for long term
savings to building owners and their tenants.
2013 2014F*
Average asking rent
Occupancy rate
Supply
HO CHI MINH CITY | 4Q 2013 | OFFICE MARKET
p.6 | colliers international
HO CHI MINH CITY | 4Q 2013 | OFFICE MARKET
p.7 | colliers international
HCmC Office market Overview
* Us$/ sq m/ month (on net area)
No Name addresscom-pletion year
NLa (sq m)
service charges (*)
Occupancy rate
Nfa asking rent (*)
1 saigon centre 65 Le Loi 1996 11,650 6.5 92% 40.02 saigon tower 29 Le Duan 1997 13,950 6.0 100% 37.03 sunwah tower 115 Nguyen Hue 1997 20,800 6.0 90% 42.54 the metropolitan 235 Dong Khoi 1997 15,200 6.0 95% 41.35 Diamond plaza 34 Le Duan 1999 15,936 8.0 98% 41.06 Kumho asiana plaza 39 Le Duan 2009 26,000 8.0 98% 51.37 bitexco financial tower 45 Ngo Duc Ke 2010 37,710 8.0 85% 34.08 president place 93 Nguyen Du 2012 8,330 6.0 92% 33.0
9 times square 22-36 Nguyen Hue 2012 9,000 7.0 60% 50.010 Lim tower 9-11 ton Duc thang 2013 29,265 6.0 88% 28.0
Grade a 187,841 6.9 91% 38.9
1 Osic 8 Nguyen Hue 1993 6,500 6.0 99% 20.02 yoco building 41 Nguyen thi minh Khai 1995 5,000 5.0 100% 16.03 somerset chancellor court 21-23 Nguyen thi minh Khai 1996 3,200 5.0 98% 21.04 central plaza 17 Le Duan 1997 6,094 5.0 100% 26.05 saigon Riverside Office 2a-4a ton Duc thang 1997 10,000 5.0 98% 20.06 saigon trade center 37 ton Duc thang 1997 31,416 6.0 97% 23.07 Harbour View tower 35 Nguyen Hue 1997 8,000 6.0 93% 20.0
8 meLinh point tower 02 Ngo Duc Ke 1999 17,600 6.5 100% 24.09 Zen plaza 54-56 Nguyen trai 2001 11,037 6.0 98% 20.010 bitexco Office building 19-25 Nguyen Hue 2003 6,000 5.5 100% 22.011 the Landmark 5b ton Duc thang 2005 8,000 6.0 82% 16.012 Opera View 161-167 Dong Khoi 2006 3,100 7.0 95% 26.013 indochina park tower 4bis Nguyen Dinh chieu 2006 2,145 4.0 96% 10.014 petro tower 1-5 Le Duan 2007 13,304 5.0 99% 30.015 city Light 45 Vo thi sau 2007 10,000 5.0 98% 15.016 the Landcaster 22bis Le thanh ton 2007 7,000 5.0 100% 24.017 Gemadept tower 5 Le thanh ton 2008 14,000 6.5 100% 23.018 fideco tower 81-85 Ham Nghi 2008 15,000 6.0 99% 20.019 Havana tower 132 Ham Nghi 2008 7,326 6.0 99% 21.020 sailing tower 51 Nguyen thi minh Khai 2008 16,910 5.0 99% 25.021 Royal center 235 Nguyen Van cu 2008 14,320 5.0 100% 19.022 tms 172 Hai ba trung 2009 4,000 4.0 100% 23.023 bao Viet tower 233 Dong Khoi 2010 10,650 6.0 100% 21.024 Green power tower 35 ton Duc thang 2010 15,600 6.0 96% 22.025 Vincom center 68-70-72 Le thanh ton 2010 56,600 5.0 72% 25.026 saigon Royal 91 pasteur 2010 5,340 4.0 100% 19.027 a&b tower 76 Le Lai 2010 17,120 6.0 99% 28.028 maritime bank tower 192 Nguyen cong tru 2010 19.596 5.0 98% 19.029 Empress tower 138 Hai ba trung 2012 19,538 5.0 87% 26.0
Grade b 364,396 5.5 93.5% 22.6
HO CHI MINH CITY | 4Q 2013 | RETAIL MARKET
p.8 | colliers international
Domestic consumer demand slump because of uncertainty of the
economic condition and unpromising figures. all three retail segments
including retail podium, department store and shopping mall witnessed
drop in rentals and occupancy rate during last quarter. the average rent
of retail podium decreased 5% while that of department store also
slided 4% q-o-q.
Occupancy rate of retail podium and shopping centers fall to 81%.
Owners of shopping centers also kept soften asking rents to prevent
downward tendency in occupancy, which staying at 86%.
maRKEt pERfORmaNcE, 4Q 2013
maRKEt pERfORmaNcE by sEctOR, 4Q 2013
paRKsON caNtaViL pREmiER OpEN iN DEcEmbER 2013
source: colliers international
source: colliers international
source: colliers international
source: public Domain
maRKEt sUppLy, 4Q 2013
Forecast > The market is expected to be back in lull period after Lunar New
Year although Year End Promotion Programs has gained significant
foot traffics and boost sales of retail places recently.
> In 2014, retail segment is expected to grow at a slow pace
upon moderate recover of the economy. Operators of shopping
malls and department stores need to adjust pricing strategy
to anticipate tenants from moving out to shophouses on high
streets at affordable rates.
Hesitation from new supply as of idle periodHO CHI MINH CITY | 4Q 2013 | RETAIL MARKET
p.9 | colliers international
Market Insight > New spaces at thao Dien pearl, imperia an phu and city Garden
will be available during first quarter of 2014. in fact, owners of
the completing developments have to delay opening until obtaining
sufficient take-up spaces.
suffered sales revenue put pressure on rentals > Retail sales revenue suffers throughout the year except daily consumption
goods with strong expansion of f&b and convenient store chains regardless
overall downturn of the market.
> Landlords of cbD retail developments stay strong to current
high asking rentals while witness increase of vacant rate over
time. the pricing strategy is supported by limited number of
new projects in coming quarters, especially in cbD areas. in
contrast, owners of non-cbD are getting pressure in rents
adjustment to soften increasing vacancy rate.
HO CHI MINH CITY | 4Q 2013 | RETAIL MARKET
p.8 | colliers international
HO CHI MINH CITY | 4Q 2013 | RETAIL MARKET
No Name of project /building address Location comple-
tion yearNLa
(sq m)average Rental
(Us$/sq m/month) Occupancy Rate
1 Hotel continental saigon 132-134 Dong Khoi District 1 2000 200 90 100%2 caravelle Hotel 19 Lam son square District 1 2000 150 90 90%3 New World Hotel 79 Le Lai District 1 2000 1,000 40 100%4 sheraton saigon 88 Dong Khoi District 1 2002 750 125 100%5 Opera View Lam son square District 1 2006 1,260 85 100%6 the manor 1 91 Nguyen Huu canh binh thanh 2006 2,000 22 100%7 saigon pearl 92 Nguyen Huu canh binh thanh 2009 5,000 20 60%8 Rex arcade 141 Nguyen Hue District 1 2010 2,000 120 90%9 the manor 2 91 Nguyen Huu canh binh thanh 2010 2,500 20 80%10 bitexco financial tower 45 Ngo Duc Ke District 1 2011 8,000 40 96%11 the Vista Walk Ha Noi Highway District 2 2012 5,000 18 55%12 president place 93 Nguyen Du District 1 2012 800 45 67%13 times square 22-36 Nguyen Hue District 1 2013 9,000 90 72%14 saigon airport plaza 1 bach Dang tan binh 2013 7,623 14 80%
Retail podium 50,323 59 81%
1 Diamond plaza 34 Le Duan District 1 1999 9,000 83 100%2 Zen plaza 54-56 Nguyen trai District 1 2001 6,817 52 100%3 parkson saigon tourist 35 Le thanh ton District 1 2002 17,000 90 100%4 parkson Hung Vuong 126 Hung Vuong District 5 2007 24,000 60 70%5 Kumho asiana plaza 35 Le Duan District 1 2009 6,830 35 100%6 parkson flemington Le Dai Hanh District 11 2009 26,000 40 85%
7 parkson paragon Nguyen Luong bang District 7 2011 7,500 40 65%
8 parkson c.t plaza truong son tan binh 2012 12,235 40 99%9 parkson cantavil premier Ha Noi Highway District 2 2013 17,815 40 80%
Department store 127,198 57.8 86%
1 saigon center 65 Le Loi District 1 1996 3,500 75 100%2 city plaza 230 Nguyen trai District 1 2000 5,250 25 100%3 superbowl Vietnam - tsN truong son tan binh 2002 5,500 22 55%4 tax center 135 Nguyen Hue District 1 2003 7,000 75 100%5 an Dong plaza 18 an Duong Vuong District 5 2004 18,000 40 99%6 saigon square 1 77-89 Nam Ky Khoi Nghia District 1 2006 1,300 167 100%7 Nowzone Nguyen Van cu District 1 2008 9,000 35 95%8 Lotte mart saigon south Nguyen Huu tho District 7 2008 24,000 35 100%9 saigon square 2 7-9 ton Duc thang District 1 2009 1,400 75 75%10 Vincom center b 72 Le thanh ton District 1 2010 45,000 62.5 80%11 maximark 3/2 Extension 3/2 street District 10 2010 25,000 40 85%12 Lotte mart phu tho Le Dai Hanh District 11 2010 24,500 30 85%13 crescent mall Nguyen Van Linh District 7 2011 45,000 30 80%14 satra pham Hung pham Hung District 8 2011 11,528 15 55%15 cmc plaza 79b Ly thuong Kiet tan binh 2011 18,000 10 60%
16 taka plaza 102 Nam Ky Khoi Nghia District 1 2011 1,000 90 100%
17 Union square Dong Khoi District 1 2012 38,000 72.5 85%
shopping centre 349,062 44.8 81%
HCmC Retail market Overview
p.9 | colliers international
HO CHI MINH CITY | 4Q 2013 | RESIDENTIAL MARKET
p.10 | colliers international
pRimaRy maRKEt pERfORmaNcE by sEGmENt, 4Q13
sEcONDaRy maRKEt pERfORmaNcE by DistRict
During last quarter, construction resumed at some projects in cbD
fringe like New pearl and Leman ct plaza (D3) while petroland
apartment (D2) and cong Hoa Garden (tan binh) stand mute. a
stream of mid-end developments were also launched including Him
Lam cho Lon (D6), sunny plaza (Go Vap), Him Lam Riverside (D7) and
Lexington Residence (D2). there was no new High-end supply in 4Q.
Last quarter witnessed approximately 2,800 apartments being
handed-over, mostly from mid-end segment in suburban areas
as well.
Generally, end-user buyers were major demands of the market with
selective criteria in construction progress, project’s facilities and
amenities.
source: colliers international
source: colliers international
LEXiNGtON REsiDENcE LaUNcHED iN 4Q 2013
source: colliers international
Market Insight > primary market experienced stabi l i ty at al l three segments
including High-end, mid-end and affordable in last quarter
of 2013.
> in 4Q, affordable projects dominated either supply and demand
numbers with new-phase releases of four projects; mostly located
in suburban areas; after achieving good take-up rate from initial
launch.
> asking price of secondary market slightly dropped as individual
investors received strong pressure from promotion programmes
of primary developers. However market confidence is gaining
steadily with increase in enquiries and actual transactions.
> Local officials are expected to apply new measures to support the
recovery of the property market in 2014 including suggestion of
50% Vat (Value added tax) reduction for property transactions.
market is stable from gain of buyer’s confidence
HO CHI MINH CITY | 4Q 2013 | RESIDENTIAL MARKET
2013 2014F*
Primary market
Secondary market
Supply
Sold rate
> average price of High-end projects gained 11% q-o-q though it is still 2% lower
than that in 4Q 2012.
> mid-end apartment’s median price went flat during last quarter while increasing
5% y-o-y. affordable condominiums remained active at average asking price of
Us$740 per sq m.
> asking price of secondary market slightly dropped 2.5% q-o-q.
HO CHI MINH CITY | 4Q 2013 | RESIDENTIAL MARKET
p.10 | colliers international
HO CHI MINH CITY | 4Q 2013 | RESIDENTIAL MARKET
aggressive inventory sales tactics to cope with pipeline of new projects > Given high remaining stocks, the developers aggressively focus on monthly tactics to boost sales in more professional and convinced
methodologies but not daily spamming emails and cold calls. Discount, flexible payment term, move-in condition (paying 30%-50%
upfront), financial support, free of management and parking fee are common sale strategies although pricing remains a decisive
factor.
> the disbursement rate of 1.56% after six months reflects moderate effect of the VND30 tri l l ion capital package
in motivating the property market.
> stakeholders in the market expect more specific instructions from local authorities in effectively implement any monetary.
No Name of project address Location Launched year Grade total units average asking
price (*)
1 Xi Riverview palace 190 Nguyen Van Huong District 2 2008 High-end 270 2,0002 cantavil premier Ha Noi Highway District 2 2010 High-end 200 1,6903 canh Vien 3 Nam Vien area, pmH District 7 2011 High-end 116 1,9054 c.t Leman plaza 117 Nguyen Dinh chieu District 3 2011 High-end 200 4,2005 star Hill commercial area, pmH District 7 2012 High-end 351 1,9506 the Vista (tower 4) Ha Noi Highway District 7 2013 High-end 141 1,5257 the prince Residence Nguyen Van troi phu Nhuan 2013 High-end 282 2,100
High-end developments
1 Everrich 2 422 Dao tri District 7 2010 mid-end 3,125 1,4502 thao Dien pearl 12 Quoc Huong District 2 2010 mid-end 450 1,2003 saigon airport plaza 1 bach Dang tan binh 2011 mid-end 242 1,3004 tropic Garden Nguyen Van Huong District 2 2012 mid-end 388 1,0005 Happy Valley Nguyen Van Linh, pmH District 7 2012 mid-end 818 1,4006 sunrise city (central + North) Nguyen Huu tho District 7 2013 mid-end 1,500 1,350
Mid-end developments
HCmC Residential market Overview
* Us$/ sq m.
p.11 | colliers international
Forecaststrong market segmentation driven by supply - demand impacts in 2014 > The market is expected to be driven by supply and demand effects under tight management of the government. It is reflected
that local officials is trying to support with improved measures instead of driving the market.
> Major issues of the market next year will be fulfil accommodation needs of local buyers and encourage distinctive segmentation
of the market. Recently released Affordable Housing Schemes is expected to enhance financial supports for this segment as well
as set a price cap to match local average income. Detailed guidance on apartment’s size, price and eligible purchasers will also
be instructed for better application of the 30 trillion package.
SOUTHERN AREAS | 4Q 2013 | INDUSTRIAL MARKET
p.12 | colliers international
> the southern Key Economic Region (sKER) including
south-East and south-West Region
> total numbers of industrial parks (ips) and Export processing
Zones (EpZs) in southeast Region is 147
> total numbers of ips/EpZs in mekong Delta is 43
> most of the ips/EpZs in the sKER is located in Ho chi minh city,
Dong Nai, binh Duong, ba Ria-Vung tau, tay Ninh and Long an
provinces
LOcatiON map Of ips/EpZs iN sOUtHERN aREas
source: public Domain, colliers international
Market Insight > Developers of the ips/EpZs in the sKER are attracting investors
in service sectors such as education, healthcare, sports, housing
for low-income people and resorts
> infrastructure (bridges, roads, harbor, clean water supply,
and environment treatment); high-technology industries
and environmental-friendly technology are also preferred
tenants of the developments.
> many foreign investors are facing many challenges including
administrative procedures, poor infrastructure and lack of
skilled workforces.
> Government agencies and business associations therefore need
to coordinate to provide more effective policies and practices in
order to attract more investors.
south-East Region is preferred location of industrial parks in southern area
Southern industrial market OverviewNo Name of Development Location area
(hecta) Warehouse Rental Occupancy Rate
1 tan binh tan binh + tan phu District 128 3-4 100%2 Linh trung 1 thu Duc District 62 3-4 100%3 tan tao binh chanh District 380 3 87.7%4 tan thuan District 7 300 4 81%5 Le minh Xuan binh chanh District 100 3 100%6 Vinh Loc binh chanh District 203 3-4 100%7 cu chi Western North cu chi District 208 2-3 100%8 Hien phuoc 1 Nha be District 311 3-4 92%9 cat Lai 2 District 2 124 3.5 89%10 Dong Nam cu chi District 287 2-3 27%
* Us$/ sq m.
HANOI | 4Q 2013 | PROPERTY MARKET
SOUTHERN AREAS | 4Q 2013 | INDUSTRIAL MARKET HANOI | 4Q 2013 | PROPERTY MARKET
Hanoi Property market Overview
HANOI | 4Q 2013 | OFFICE MARKET
During 4Q 2013, pipeline of new projects kept average rentals in
downward tendency. there is not yet any sign of the market hitting
rock bottom as price keep falling for the last 2 years.
in Q4 2013, Grade a office sector show some signs of recovery. the
average occupancy of the Grade a offices was about 75%, slight
increase than that of the previous quarter. year-on-year rent rate
reduced 17% maintained stable occupancy rate despites the steady
increase in supply.
Given high occupancy rate of 90%, landlords of Grade a building in
current cbD held high rent rates.
p.13 | colliers international
cURRENt sUppLy by GRaDE, 4Q 2013
source: colliers international
GRaDE a OfficE pERfORmaNcE
source: colliers international
fUtURE sUppLy by DistRict
fUtURE sUppLy by statUs
source: colliers international
Forecast > The rental gap between current and new CBD areas outweight
the fitting out and relocating costs. Hence tenants will continue
to move out of buildings within the existing CBD areas to higher
quality and less expensive options in outlying districts which is
considered as new CBD including Cau Giay and Tu Liem District.
> During this year, landlords of office buildings in existing CBD
areas still face difficulties in retaining current tenants as well
as attracting new ones.
> Office buildings are at piercing competition to be cheaper yet
maintain good quality and services.
> Although current pricing strategy of Grade A buildings is supported
by sufficient take-up rate, it is flexible in negotiation that achievable
rentals are deducted from “rent-free period” and longer fitting out
time.
Hanoi Office market is driven by tenant powers
> in Q1 2014, the market supply would be increase by approximately
124,000 sq m. in NLa of which 73,000 sq m. from b-graded EVN
tower and 51,000 sq m. from a-graded pVi tower.
> in the middle of 2014, Lotte centre Hanoi will be available, adding
another 45,000 sq m. to Grade a office segment. this shall put
more pressure on those in both the existing and new cbD.
> because of that huge increasing number of supply, the office market
would still belong to tenant.
sUppLy by typE, 4Q 2013
maRKEt sUppLy
HANOI | 4Q 2013 | RETAIL MARKET
p.14 | colliers international
> the average market rent was recorded at approximately Us $53/ sq
m., a decrease of 10% q-o-q or approximately 20% y-o-y.
> the occupancy rate was about 83%, declining by 7.1 percentage
point q-o-q.
> the average monthly rent of shopping centre is higher than
that of department store; i.e. Us $53.2 and Us $46.4 per sqm.
respectively.
> average rent of retail podium reached Us $80.7 per sqm per month.
> Regarding occupancy rate, the highest number belongs to department
store (88.7%), whereas retail podium and shopping centre were occupied
by around 82.6% and 80.8% accordingly.
source: colliers international
maRKEt pERfORmaNcE
source: colliers international
source: colliers international
Forecast > We expect a market influence from re-launch of MIPEC tower in 1Q 2014 and open Lotte Center Hanoi in 2Q 2014 by Lotte Mart that
provide strong retail spaces between the Old and New CBD areas.
> Regardless difficulties from low market demand, we could expect that retail market segment will recover faster than any other
real estate sector as International retailers are targeting Vietnamese large population and new trendy lifestyle.
> As Vietnam’s agreement to join WTO, the regulations are getting loosen gradually to welcome FDI firms coming to join the market
with less restrictions and more incentives M&A across all sectors are opening door for more hypermarket, food chain to make their
presence one way or another.
market plunged in Old cbD areas the launching of Vincom mega mal l times city made both
average occupancy and rental of retail market plunged in
Q4 2013. the decline in price mainly comes from the mass
launching of new space and the re-launching of retail space
within the existing cbD. both of them have offered much more
competit ive rentals to attract tenants.
Retail space within cbD was grey as high asking rates even though
the luxury and mid-end retailers were suffering slump period. Early
termination or closure of tenants occured at all malls.
However, in the outer cbD, the retail market was at booming
as developers trying to cover up their presence within low- and
middle-income segment.
HANOI | 4Q 2013 | RESIDENTIAL MARKET
p.15 | colliers international
according to colliers’ recent survey, 30% of projects in the market are
under construction, others 31% on planning and vacant land status and
remaining 39% delayed. most of the future supply are in tu Liem, cau
Giay and Ha Dong District.
the major primary supply in this quarter comes from Hai ba trung
district, with considerable price and quantity from minh Khai street.
Hoang thanh tower, a luxury project pushed up the asking price in
the area.
During the crisis, many projects have ceased construction leading
to demoralize market trust and confidence. However, projects with
banks’ support in debt restructuring and finance management have
resumed construction and obtained increase in sales.
maRKEt pERfORmaNcE, 4Q 2013
pRimaRy maRKEt pERfORmaNcE, 4Q 2013
sEcONDaRy maRKEt pERfORmaNcE, 4Q 2013
maRKEt sUppLy, 4Q 2013
source: colliers international
source: colliers international
source: colliers international
Forecast > In December 2013, the banks actually lend out 758.7 billion,
an increase of 61% from November. The number is not only
impressive in volume but also showed a significant break
through in the whole process that expected to get a boost
in buyer’s confidence. We expect positive impacts on both
developers and buyers from disbursement of the 30-trillion
package this year.
> In 2014 more postponed projects are expected to be restarted.
the trillion stimulus package getting effective
source: colliers international
> average asking price of the primary market dropped from Us$752
to 728 per sq m., a slight decrease of 3% from last quarter.
> affordable apartments are priced in range of Us$650 - 700 per sq
m. while the mid-end segment reached Us$1,100 per sq m.
> the secondary market also dropped 1.1% in asking price.
> Ha Dong and tu Liem areas with affordable projects pricing at
Us$ 868 per sq m. on average are leading in supply number of
apartments.
> in Q4 2013, the VND 30,000 billions stimulus package seems to
be more active with over 1,700 approved cases valued total of VND
1,881.4 billions.
> Overall, the asking price in both primary and secondary markets
show slight decrease but there are sign of hitting rock bottom and
bouncing back.
HANOI | 4Q 2013 | PROPERTY MARKET
HANOI | 4Q 2013 | PROPERTY MARKET
No Name of project Developer Location completed year
NLa(sq m.)
average asking price (*)
1 Viet tower Hoa binh trading & invest-ment Jsc 1 thai Ha, Dong Da 2008 20,000 18
2 EVN tower EVN 11 cua bac, ba Dinh 2012 45,621 30
3 pacific building NcX 2 Dai co Viet, Hai ba trung 2013 4,279 17
4 ViD tower 30/4 tourism & trading Jsc 115 tran Hung Dao, Hoan Kiem 2013 4,136 21
5 63 Le Van Luong 319 Group 63 Le Van Luong, trung Hoa, cau Giay 2013 12,254 18
Hanoi Office market Overview
p.16 | colliers international
Hanoi Retail market Overview
Hanoi Residential market Overview
No Name of project Developer Location completed year
NLa(sq m.)
average asking price (*)
1 EVN tower EVN 11 cua bac, ba Dinh 2012 4,385 45
2 Hong River tower thien Duc services Jsc 2 tran Hung Dao, Hoan Kiem 2012 2,300 35
3 63 Le Van Luong 319 Group 63 Le Van Luong, trung Hoa, cau Giay 2013 20,728 45
4 mo market shopping mall Vinaconex 459c bach mai, truong Dinh, Hai ba trung 2013 24,223 45
5 ctm building ctm 139 cau Giay 2014 5,000 45
No Name of project Developer Location Hand-over period total units average asking
price (*)
1 Nam Xa La (phuc Ha tower) ipacO Xa La, phuc La, Ha Dong Urban area 2Q 2014 324 600
2 Hyundai Hillstate Hyundai RNc Ha tay to Hieu, Ha cau, Ha Dong 1Q 2014 928 1,200
3 HEi tower Ha Noi Electric investment JV Nguy Nhu, Kontum, thanh Xuan 1Q 2014 300 1,300
4 136 Ho tung mau Vinaconex 7 Ho tung mau, cau Dien, tu Liem 4Q 2014 360 730
5 berriver Long bien Hanco 9 Nguyen Van cu, Long bien 2Q 2014 324 1,270
* Us$/ sq m/ month (on net area)
* Us$/ sq m/ month (on net area)
KNOWLEDGE REPORT | 4Q 2013 | VIETNAM
With more than 100 professionals in 2 offices in Vietnam, the team is market driven and has proven and successful track record with both international and local experience.
From Hanoi to Ho Chi Minh City, we provide a full range of real estate services
•Research > Market research across all sectors > Market analysis, advisory, and strategy
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•Residential Sales & Leasing
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The foundation of our services is the strength and depth of our experience.
COLLIERS INTERNATIONAL
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