Buying and Investing in Vietnam Presentation

8/4/2019 Buying and Investing in Vietnam Presentation

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Presented by :

Marc Townsend Managing DirectorCB Richard Ellis (Vietnam)Saturday, 3rd Nov 2007Hong Kong

BUYING & INVESTINGIN VIETNAM


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CB Richard Ellis | Page 2

MAKE THE BEST OF YOUR BUDGETWHERE TO BUY

Market Sentiment Market Sectors to Consider Where to buy if you have

INVESTMENT PROSPECTS Market Overview Investment Trends


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Map Of Vietnam


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Total Population 85 million

More than 60% of the populationare of working age

(under 35 years)*, highly literate,

hard-working, consumer orientatedand highly motivated.

Birth Rate: 1.44% p.a (1.2m)

Median Age: 25.9 years

Average Life Expectancy:70.8 years

73.85 yrs (women) /68.05 yrs (men)

Population Demographics

>60 Years


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Population


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SERVICED APARTMENT PRICESMARKET SENTIMENTS

SERVICED APARTMENTShortage of quality

apartmentsMainly catersto expatriatesHANOI Serv i ced Aparmen t

Average Rents by Types o f Uni t (US$/sqm/month)

$0.00

$5.00

$10.00

$15.00

$20.00

$25.00

$30.00

$35.00

$40.00

$45.00

$50.00

Q1/2006

Q2/2006

Q3/2006

Q4/2006

Q1/2007

Q2/2007

Q3/2007

Studio

1 Bed

2 Bed

3 Bed

4 Bed

5 Bed

Villa 2 Bed

Villa 3 Bed

Villa 4 Bed

3 Bed (Penthouse)

HCMC Serviced Apartment Average Rentsby Types of Unit (US$/sqm/month)

$0

$10

$20

$30

$40

$50

Q

1/06

Q

2/06

Q

3/06

Q

4/06

Q

1/07

Q

2/07

Q

3/07

Q

4/07

Studio

1-bedroom

2-bedroom

3-bedroom

4-bedroom

5-bedroom


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CONDOMINIUM PRICE FLUCTUATIONSMARKET SENTIMENTS

HANOI new stock for 2008-2010:7,634 units

HCMC new stock for 2008-2010:29,630 units

CONDOMINIUMSC O N D O P R I C E S - S I G N I F I CA N T P R O J E C T S

$0

$500

$1,000

$1,500

$2,000

$2,500

$3,000

$3,500

Lilam

aComplex

25Vu

NgocPhan

Ciputra

IC

CBuilding

KinhDoBuilding

ThaiThin

hComplex

10

1LangHa

15-1

7NgocKhanh

25LangHa

195DoiCan

ArtexBuilding

VIMECO

ChelseaPark

Golde

nWestlake

TheManor

PacificPlace

Initial Price

Current Price/Market Price (Q1/2007)


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VISTA CONDOMINIUM SALES IN HCMC 19th of October, 2007WHERE TO BUY

Vista & SkyGarden 3(Phu MyHung)


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Latest Residential Release in HCMC


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TIPS ON BUYING RESIDENTIAL IN VIETNAM

Buy from developers with track record

Facilities and amenities (swimming pools etc)

Corner units with views on high floors

Quality properties always have a display

apartment

Think about leasability and resale potential

Monthly service charge and property management

issues


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WHERE TO BUYRESORT VILLA MARKET

Name of resorts Location Area (ha) Details

Son Tra Resort Da Nang 30 5-star hotel (15 storeys), 193 villas

Nam Hai Resort Hoi An 31 40 villas, 60-room hotel

Mui Ne Domaine 3.5 135 luxury villas

Aquaba Mui Ne 2.5 2 seven-storey apartment blocks and 6 private beach front villas

DBC Resort 13 One 5-star hotel and 50 villasHoang Tra Resort 4 One 5-star hotel and 40 villas

Bac My An Resort 34 One 5-star hotel, 1 shopping center, interl school and villas

Silver Shore Resort 20 One 5-star hotel and 50 luxury villas

Millennium Groups Resort 15 One 5-star hotel and villas

Hoang Anh Gia Lais Resort 4.5 100 villas

Trem Resort 10 200 villas

Bai But Resort 40 One 5-star hotel and 200 villasHoa Hai Sea Tourist Resort &

Golf Course260 241 villas and interl standard 36-hole golf course

Indochina Land Resort 20 4-storey Hyatt Hotel, two 8-storey condos Towers and 40 villas

Olalani Resort 7 42 condos, 3 villas and some spaces for office and retail

La Bamboo Spa Resort 11 46 villas and 180 bungalows

Kim Vinh Resort 7 100 villas

21st

Century Resort 13 200 hotel rooms (4-star)

Hoi An Golf & Beach Resort 120 350 hotel rooms, a golf course and villas

On-going

resorts Binh

Thuan

FutureProjects

Da Nang

Hoi An

Quang

Nam

Ongoing Projects: 268 villas / 4 projects in Da Nang, Hoi An, Phan Thiet Binh Thuan Future Projects: More than 876 villas / 15 projects in Da Nang, Hoi An, Quang Nam


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WHERE TO BUY - HANOIUS$250,000HANOI: Condominiums

HATAY: Villas

US$500,000HANOI: Condominiums

Initial price for clean land

Market price for clean land

US$500-650/sqm

US$ 700-950/sqm

An Khanh New Urban Area

WHERE TO BUY IF YOU HAVE

CON DOSAverage sales rate (US$/sqm)PACIFIC PLACE (Hoan Kiem

District)1,800-3000

THE MANOR (My Dinh) 1,700 - 2,200

Ciputra 800-1,400

CONDOSAverage sales rate (US$/sqm)


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WHERE TO BUY HO CHI MINH CITYHCMC Residential Hot Spots

US$250,000


US$500,0001,600-1,900

1,500-1,700

1,800-2,400

1,100-1400

1,500-1,800

SkyGarden

3

Tan DaCourt

HungVuongPlaza

HorizonCentralGarden

2,300-2,8002,300-2,500

2,300-3,200

1,700-2,900

4,300-5,000

3,800+3,800+4,200-4,800

PanoramaGardenCourtTheManorRiverGardenAvalonSaigonResidenceBenThanhTower

Lancaster


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WHERE TO BUYUS$1,000,000Emerging Products


IndochinaLandHoldingsOverview

7 remaining(US$ 1.1-2M)

8 leftOpenedLaunching

May 2007 todate

Apr2007

Dec 20062004

40 resort pool villas for sales

THE NAM HAI RESORT 5-star(Quang Nam)


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INVESTMENT PROSPECTS

Hanoi Hi-endResidential ProjectsOpen market rateINCREASING afterlaunching

Average absorptionrate: 91.6 %

RESIDENTIAL PROJECTS in HANOI & HCMC

HCMCsignificant VillaProjects

Trendy segment ofResidential Market ofHCMC

PACIFICPLACE

CIPUTRAHANOI

THEMANOR

THEGARDEN

CHELSEAPARK

GOLDENWESTLAKE

83B Ly Thuong

Kiet Street

Phu Thuong,

Nhat Tan, Xuan

La Ward

My Dinh

Ward

My Dinh

Ward

Trung Kinh

Ward

151 Thuy Khue

Street

Q2/2007 2018 Q2/2007 Q2/2007 Q2/2007 Q3/200895.00% 80.00% 95.00% 95.00% 95.00% 90.00%High 2,800 1,000 1,500 2,100 1,000 2,500Mid 2,300 750 1,200 1,800 900 2,200Low 1,600 500 900 1,500 800 1,600

High 3,000 1,400 2,200 3,000 1,600 2,800Mid 2,500 1,100 1,900 2,200 1,200 2,500Low 1,800 800 1,700 1,560 1,000 2,000

Apartment

InitialAverage

RateCurrentAverage

Rate

Absorption RateApartment

Expected Completion Date

PROJECT NAME

Location

TOP-END RESIDENTIALPROJECTS

HANOI

Average Pr ice Change of Phu Gia, Vi lla R iviera and Thu Duc Garden Home

$1,000

$3,800280%

200%140%120%100%90 %70 %50%30 %

$1,500 20%33% 60 %

73% 100%$3,500133%

$680 62%3% 40%76 %

$1,35099%

0%

50%

100%

150%

200%

250%

300%

2001 2002 2003 2004 2005 2006 Q1/07 Q2/07 Q3/07 Q4/07

Phu Gia - PMH town

(launched in 2001)

Villa Riviera - D.2

(launched in 2004)

Thu Duc Garden Home

(launched in 2005)


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INVESTMENT PROSPECTS

Vietnam ranked

as worlds 4th mostattractive retail

market AT Kearney, 2007

Customer Profile

- Upwardly mobile

- Young, brandconscious culture

RETAIL MARKETANOI HCMC

Gross Area and Average Rent of Hanoi Shopping Centres

0

5,000

10,000

15,000

20,000

25,000

30,000

35,000

HanoiTower

TrangTien

Plaza

Vincom

City

Tow

ers

BigCThang

Long

OperaBu

siness

Centre

Pacific

Place

Sm

0.00

10.00

20.00

30.00

40.00

50.00

60.00

70.00

80.00

90.00

100.00

US

Gross Leasable Area

Ave. Asking Rent (US$/sqm/mth)


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DECREE 84 Progressive Land Reform

Decree 84 introduces useful amendments to Vietnams landregulations. Of most importance to the property marketinclude:-

New LAND USE RIGHT certificate issued on a long andstable basis times over (i.e. in perpetuity) for 70 years(formerly 50 years).

Decree 84 also lists cases in which the Government willassume responsibility of land clearance to transfer theland to investors to speed up the development process andavailability of stock to the market place.

Foreign developers can now be assigned property & can bidfor sites at government auctions.


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CAN FOREIGNERS PURCHASE?

A foreign investor can purchase leasehold tenure for normal50 or 70 year term via an assignment of a long term leasefrom the developer direct.

A foreign investor cannot borrow funds to purchase leaseholdtenure under current law. Such tenure cannot be bequeathedeither. CASH ONLY PURCHASERS for this type of property.

Foreign Organizations and individuals who are allowed toenter Vietnam for 3 months can also purchase leasehold titleonly and cannot borrow against the asset and the asset cannot

be bequeathed.


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TAXATION IMPLICATIONS - VIETNAM

Vietnam has a fairly onerous tax regime including:-

1. VAT standard rate is 10% (payable on property

purchase);

2. Corporate Income Tax @ 28%;

3. Capital Gains Tax @ 28% of realized profit (ifcompany) If privately owned 25%; and

4. Personal Income Tax If purchaser does not live in

Vietnam, personal tax rate @ 25% of incomegenerated.


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SUMMARY

Vietnam is an economic growth success story

As incomes rise, so does demand for better housing, consumergoods and modern retail and entertainment facilities

WTO membership has heightened the interest of overseascompanies and therefore interest in quality office and retail space

The fundamentals the economy, demographic are very sound

Developers and investors taking a longer term view of the marketand who seek quality partners and projects are likely to do well

This is a race likely to be won by the marathoners not the sprinters

CBRE (Vietnam) predicts that current growth rates will continue in

the short to medium term for well located and good quality projectsdue to underlying market fundamentals of strong demand for suchstock versus limited supply opportunities in the current market.


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THANK YOU !

www.cbrevietnam.com

Buying and Investing in Vietnam Presentation

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