HCMC CBD Market Report | Mar 2014

MARCH 2014 | HCMC CENTRAL BUSINESS DISTRICT

CBD MARKET REpoRTHO CHI MINH CITY

www.colliers.com/vietnam

TABLE oF CoNTENTSHCMC CBD MARKET REpoRT | MARCH 2014

Market Highlights

oFFICE MARKET

• Market overview

• outlook

• Table

• Map

RETAIL MARKET

• Market performance

• outlook

• Map

• Table

HoTEL MARKET

• Map

• Table


• outlook

SERVICED ApARTMENT


• outlook

• Table / Map

CoNTACTS

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HCMC CBD MARKET REpoRT

MARCH 2014 | COMMERCIAL OFFICE MARKET



p.2 | Colliers International

According to Asia pacific office Rents Map in 4Q13 from Colliers International, HCMC is expected to keep up with rental growth,

though moderate, in emerging South East Asia cities during this year.

Although showing steady gain in recent years, Vacancy Rate of HCMC still stays at double digit figure. However, given promising

on efficient absorption and limited new supply of top graded office buildings in CBD area, this rate is expected to fall in 2014-

2015 period.

The average asking rent of Grade A and B office

buildings was unchanged during last month. owners

of developments of both segments also succeeded

in retaining occupancy rate at approximately 90% on

average.

Construction resumed at Le Meridien, one of the

major Grade A supply of 2014, and it is expected to

put in operation this April.

Outlook

GRADE A pERFoRMANCE

Source: Colliers International

GRADE B pERFoRMANCE


prime office Rent in CBD, 4Q2013(US$/sq ft/annum)

ForecastDirection 2014

Forecast Direction 2015

Vacancy Rate, 2013 ForecastDirection 2014

ForecastDirection 2015

Supply Forecast 2014 (million sq ft)

Supply Forecast 2015 (million sq ft)

Asia Pacific Office Rents Map, 4Q 2013


Market Performance




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 90% 42.72 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% 49.37 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 87% 30.0

9 Times Square 22-36 Nguyen Hue 2012 9,000 7.0 60% 4710 Lim Tower 9-11 Ton Duc Thang 2013 29,265 6.0 89% 28.0

Grade A 187,841 7.0 90% 39.1

1 oSIC 8 Nguyen Hue 1993 6,500 6.0 99% 20.02 Yoco Building 41 Nguyen Thi Minh Khai 1995 5,000 4.0 100% 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 5.0 93% 20.0

8 MeLinh point Tower 02 Ngo Duc Ke 1999 17,600 6.0 100% 24.09 Zen plaza 54-56 Nguyen Trai 2001 11,037 5.0 97% 21.010 Bitexco office Building 19-25 Nguyen Hue 2003 6,000 5.0 100% 22.011 The Landmark 5B Ton Duc Thang 2005 8,000 5.0 82% 21.012 opera View 161-167 Dong Khoi 2006 3,100 7.0 95% 26.013 Indochina park Tower 4Bis Nguyen Dinh Chieu 2006 2,145 3.0 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 7.0 100% 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 6.0 99% 25.021 Royal Center 235 Nguyen Van Cu 2008 14,320 5.0 100% 23.022 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 89% 23.029 Empress Tower 138 Hai Ba Trung 2012 19,538 6.0 87% 26.030 Sunny MB Tower 259 Tran Hung Dao 2013 13,200 5.5 12% 22.0

Grade B 377,596 5.5 90.1% 23.1

* US$/ sq m/ month (on net area)

Office Market Overview


MARCH 2014 | CBD OFFICE MAP




MARCH 2014 | CBD OFFICE MAP



MARCH 2014 | RETAIL MARKET


Average rental rate and occupancy rate of both retail podium

and department store were generally flat during last month.

Department store remained fully occupied while retail podium

retained vacant rate around 13% given limited available prime

space.

owners of shopping mall in CBD areas stayed strong with high

offered rents regardless significant drop of 6% in occupancy

rate in February. Increasing vacant spaces can be found

in central shopping mall including VinCom Center B and

Unionsquare.

Market Performance

Outlook

SHoppING CENTER MARKET pERFoRMANCE, FEB14

VACANT SpACES @ VINCoM CENTER IN MARCH 2014


According to the General Statistics office, Consumer price Index (CpI) in Ho Chi Minh City (HCMC) rise slightly by 0.24% in February,

the lowest increase in the past decade because of the pull back in purchasing power.

A weak consumer spending and unchanged high rental pressure tenants of CBD retail centers to relocate or consolidate their

brands.

Fashion and baby products are major categories moving out since early of the year, especially those located in back-front plots.

As of our expectation at the end of last year, there is an increasing numbers of tenants relocating from CBD malls to high street

shops. Affordable rents and convenient accessibility are major driving factors although finding site with sufficient floor spaces

within central districts is not easy actually.

Although there are new take-ups of new brand fashions and spa and clinic stores, the inadequate replacements will soon influence

the operator’s pricing strategy of prime retail areas.


RETAIL poDIUM MARKET pERFoRMANCE, FEBRUARY 2014



MARCH 2014 | CBD RETAIL MAP


MARCH 2014 | RETAIL MARKET


MARCH 2014 | CBD RETAIL MAP


KUMHo MoNTHLY MARKET REpoRTMARCH 2014 | RETAIL MARKET HCMC CBD MARKET REPORT


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 91 100%2 Caravelle Hotel 19 Lam Son Square District 1 2000 150 90 100%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 Rex Arcade 141 Nguyen Hue District 1 2010 2,000 120 100%7 ICoN 68 45 Ngo Duc Ke District 1 2011 8,000 30 90%8 president place 93 Nguyen Du District 1 2012 800 70 71%9 Times Square 22-36 Nguyen Hue District 1 2013 9,000 90 72%

Retail podium 23,161 69.9 84.7%

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 Kumho Asiana plaza 35 Le Duan District 1 2009 6,830 35 100%

Department Store 39,647 72.4 100%

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 Tax Center 135 Nguyen Hue District 1 2003 7,000 75 100%4 Saigon Square 1 77-89 Nam Ky Khoi Nghia District 1 2006 1,300 167 100%5 Nowzone Nguyen Van Cu District 1 2008 9,000 35 95%6 Saigon Square 2 7-9 Ton Duc Thang District 1 2009 1,400 90 80%7 Vincom Center B 72 Le Thanh Ton District 1 2010 45,000 63 70%

8 Taka plaza 102 Nam Ky Khoi Nghia District 1 2011 1,000 90 100%

9 Union Square Dong Khoi District 1 2012 38,000 73 79%

Shopping Centre 113,450 66.9 80%

No Name of Hotel Address Location Comple-tion Year Total Room occupancy ARR(*)

1 Caravelle 19 Lam Son Square District 1 2000 335 73% 1632 New World Saigon 76 Le Lai District 1 2000 533 75% 1033 Sofitel plaza Saigon 17 Le Duan District 1 2000 290 64% 1244 Rex 141 Nguyen Hue District 1 2000 289 82% 1225 Renaissance Riverside 8-15 Ton Duc Thang District 1 2001 350 77% 1096 Lotte Legend Hotel 2A-4A Ton Duc Thang District 1 2001 283 62% 1337 Sheraton 88 Dong Khoi District 1 2002 480 85% 2238 park Hyatt Saigon 02 Lam Son Square District 1 2005 259 83% 3309 Majestic Saigon 1 Dong Khoi District 1 2007 175 74% 12810 InterContinental Asiana 39 Le Duan District 1 2009 305 85% 24411 Nikko Saigon 235 Nguyen Van Cu District 1 2011 334 75% 10512 pullman Hotel 146 Tran Hung Dao District 1 2013 306 61% 94

5 Star 3,633 75% 155

1 Continental Saigon 132-134 Dong Khoi District 1 1990 86 76% 922 Norfolk Hotel 117-119 Le Thanh Ton District 1 1992 104 72% 973 Duxton 63 Nguyen Hue District 1 1996 203 74% 814 Royal City 133 Nguyen Hue District 1 2000 135 72% 555 palace Saigon 56-66 Nguyen Hue District 1 2000 146 89% 676 oscar 68A Nguyen Hue District 1 2000 108 72% 647 Liberty Central 179 Le Thanh Ton District 1 2010 140 78% 788 Grand 08 Dong Khoi District 1 2011 107 69% 959 Liberty Central Riverside 17 Ton Duc Thang District 1 2013 170 73% 85

4 Star 1,161 75% 78

MARCH 2014 | HOTEL MARKET HCMC CBD MARKET REPORT

KUMHo MoNTHLY MARKET REpoRT HCMC CBD MARKET REPORT

HCMC CBD MARKET REPORT


MARCH 2014 | CBD HOTEL MAP




MARCH 2014 | HOTEL MARKET

Vietnam welcomed 842,026 overseas arrivals, grown

dramatically 47.6% over the same period. Germany visitors

have posted the highest rise of 266.9%, followed by China and

Cambodia. During the time, the domestic tourists were around

9.5 million, a y-o-y increase of 21.8%, gathering in VND47

trillion (US$2.2 billion) in revenue.

In the first two months of the years, HCMC welcomed 778,000

foreign guests, increased 11% over the same period last year.

Market Overview

OutlookWe expect moderate new supply of top-graded hotel segments

located in prime CBD area during this year.

Le Meridien Saigon is announced to open this June whereas

operation time of Reverie Times Square is undisclosed.

Stayed on top of Unionsquare shopping malls, Vinpearl Luxury

Hotel Saigon has been converted into office function by new

owner.

TRAVEL pURpoSES oF INTERNATIoNAL VISIToRS To VN

Source: Statistical Office in HCMC, Colliers International

FUTURE SUppLY BY CoNSTRUCTIoN, MARCH 2014


HoSpITALITY REVENUE BY TYpE, MARCH 2014


RENDER oF CT HoTEL LE LoI oN pASTEUR STREET, D1

Source: Public Domain









5-star hotels in CBD showed positive figures for both average rental and occupancy rate during February. The average rent reached

US$155 while occupancy rate slightly rised 2%.

Meanwhile, 4-star segment also gained in occupancy rate though offered rate dropped 2% last month.

After gradual growth in occupancy rate of top-graded hotels in CBD locations since last quarter of 2013, we expect a downward trend

from this month regarding the end of peak holiday season.

Market Performance

pERFoRMANCE oF 5-STARS HoTEL


FEBRUARY 2014 | SERVICED APARTMENT MARKET

Serviced Apartment OverviewCBD SERVICED ApARTMENTS pERFoRMANCE


SERVICED ApARTMENTS SUppLY BY DISTRICT


pERFoRMANCE oF 4-STARS HoTEL




* US$/sq m/month** Not including VAT and service charge*** Buildings are sorted by Year of Completion

MARCH 2014 | SERVICED APARTMENT MARKET

It is expected that CBD serviced apartments sector will experience

slow activity in short term as this is not preferred time for house

transfer or relocation.

Both average occupancy rate and asking rent of top-tier serviced

apartments in central area are expected to fall in second half of

2014 driven by new available supplies from Times Square.

Outlook

Both Grade A and B serviced apartments were almost flat during last month in monthly average rental rate as well as occupancy rate.

In February, developers of Grade A serviced apartment buildings retained average occupancy rate at 94% and asking rent at monthly

US$33.8 per sq. m. That of Grade B segment was 79% and US$26.5 respectively.

Market Performance

SERVICED ApARTMENT FUTURE SUppLY BY YEAR


No project Name Address Location Comple-tion Year

Total Room

Average occupancy ARR(*)

1 Somerset Chancellor Court 21-23 Nguyen Thi Minh Khai District 1 1996 172 95% 362 Sedona Suites 65 Le Loi District 1 1996 89 88% 303 Nguyen Du park Villas 111 Nguyen Du District 1 2004 41 90% 304 The Landmark 5B Ton Duc Thang District 1 2005 66 95% 265 The Landcaster 22 Bis Le Thanh Ton District 1 2007 55 93% 376 InterContinental Asiana Saigon 39 Le Duan District 1 2009 260 97% 36

Grade A 701 94% 34

1 Somerset HCM 8A Nguyen Binh Khiem District 1 1998 165 85% 262 Saigon Sky Garden 20 Le Thanh Ton District 1 1998 154 87% 263 Norfolk Mansion 17-21 Ly Tu Trong District 1 1998 126 92% 334 Diamond plaza 34 Le Duan District 1 1999 42 93% 295 Garden View Court 101 Nguyen Du District 1 2000 76 91% 316 Spring Court 1Bis phung Khac Khoan District 1 2006 14 78% 187 Ben Thanh Luxury 172-174 Ky Con District 1 2010 30 75% 258 Vincom Center 72 Le Thanh Ton District 1 2010 60 32% 26

9 Lafayette De Saigon 08 phung Khac Khoan District 1 2010 18 100% 30

10 Nikko Saigon 235 Nguyen Van Cu District 1 2011 54 50% 28

11 Saigon City Residence 8A/3D2 Thai Van Lung District 1 2011 17 100% 30

Grade B 738 79% 26.5


MARCH 2014 | CBD SERVICED APARTMENT MAP


MARCH 2014 | SERVICED APARTMENT MARKET


MARCH 2014 | CBD SERVICED APARTMENT MAP


HCMC CBD MARKET REPORT | MARCH 2014

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Vietnam Cities Quarterly All market sectors publicly available

CBD Report HCMC CBD Monthly office, Retail, Hotel and Serviced Apartment

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Asia pacific in-cluding Vietnam

Quarterly office market publicly available

Vietnam property Market Report

Vietnam cities Quarterly All market sectors on subscription

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HCMC CBD Market Report | Mar 2014

Real Estate

Transcript of HCMC CBD Market Report | Mar 2014