Myanmar | One Giant Leap for Real Estate

Tony Picon | Associate Director | Colliers International Thailand

New Myanmar Investment Summit 2012 – PARKROYAL, Yangon

Map of Yangon | How we zone the city

2Thilawa Port 25 km

Outside Yangon City

NO VACANCIES – Hospitality Challenges

Hotel market | Crunch time

4

SUPPLY BY LOCATION OF UPPER SCALE HOTEL ROOMS

0

200

400

600

800

1000

1995 1996 1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011

Rooms

Year

Downtown Area Inner City Area Outer City Area

Source : Colliers International Thailand Research

Hotel | Supply shortage

UPPER SCALE/LUXURY HOTEL ROOMS

5

0

2,000

4,000

6,000

8,000

10,000

12,000

14,000

16,000

Yangon Vientiane Bangkok

Rooms

City

Source : Colliers International Thailand Research

Hospitality | Making up for lost time

6

• No new Upper Scale hotels for past 10 years

• Office space kept hotels alive

• Sudden influx leading to near full occupancy

• Room rates beginning to soar

• Serviced Apartments in same situation

• Bonanza expected over next three years

Three to four year timeframe

• Few nearly completed projects

• Economy/three star hotels

• Refurbish existing properties

• Improve old hotels

• Mandalay/Nay Pyi Taw airports

• Apartments for lease

• Training

7

The 150 dollar per sq m office of the future

Historical supply – Office in Yangon

9

Source : Colliers International Thailand Research

-

20,000

40,000

60,000

80,000

1993

1994

1995

1996

1997

1998

1999

2000

2001

2002

2003

2004

2005

2006

2007

2008

2009

2010

2011

Area (Sq M.)

Year

Supply at the start of the year Additional supply during the year

HISTORICAL SUPPLY FOR YANGON

Office supply | A long way to go

10

0

20,000

40,000

60,000

80,000

100,000

120,000

140,000

160,000

Empire Tower

(Bangkok)

Yangon Phnom Pehn Vientiane

Area (Sq M)

City

Source : Colliers International Thailand Research

SUPPLY IN VARIOUS LOCATIONS

Office market | Future trends

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0

200,000

400,000

600,000

800,000

1,000,000

1,200,000

1,400,000

1996 1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011

Yangon HCMC

HISTORICAL SUPPLY FOR YANGON AND HO CHI MINH CITY

Source : Colliers International Thailand Research

2008 Hanoi 550,000 sq mHCMC – Rents top $100 sq mGrade A – Full occupancy

The next industrial revolution

Industrial Estate

13

PROPORTION OF INDUSTRIAL ESTAE LAND IN YANGON AND OTHER STATES / DIVISIONS

Source : Department of Human Settlement and Housing Development (DHSHD) and Colliers International

Thailand Research

Industrial Estates in Myanmar

14

-

500

1,000

1,500

2,000

2,500

3,000

3,500

4,000

4,500

5,000

5,500

6,000

1990

1991

1992

1993

1994

1995

1996

1997

1998

1999

2000

2001

2002

2003

2004

2005

2006

2007

2008

2009

2010

2011

Area (Hectare)

Year

Supply at the start of the year Additional supply during the year

Source : Department of Human Settlement and Housing Development (DHSHD) and Colliers International

Thailand Research 1 hectare = 6.25 rai

HISTORICAL SUPPLY IN MYANMAR

Ports for future opportunity

15

• Thilawa

• Sittwe

• Kyaukphu

• Dawei

• Pathein

• But wait and see

A real hardship posting?

Serviced apartment market

17

HISTORICAL SUPPLY IN YANGON

0

200

400

600

800

1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011

Units

Year

Supply at the start of the year Additional supply during the year

Source: Colliers International Thailand Research

Hardship posting

• Very limited serviced apartments

• Quality condominiums in short supply but changing

• Hospitals vary in quality

• Construction sites will define next few years

• Power cuts will still be part of life

• Not everybody’s choice but .......

But delightful

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