HCMC CBD Market Report | Nov 2014

NOVEMBER 2014 | HCMC CENTRAL BUSINESS DISTRICT

CBD MARKET REpoRTHO CHI MINH CITY

www.colliers.com/vietnam

TABLE oF CoNTENTSHCMC CBD MARKET REpoRT | NoVEMBER 2014

Market Highlights

oFFICE MARKET

• Market overview

• Market performance

• outlook

• Table

RETAIL MARKET

• Market overview


• outlook

• Table

HoTEL MARKET

• Market overview


• outlook

• Table

SERVICED ApARTMENT


• outlook

• Table

CoNTACTS

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HCMC CBD MARKET REpoRT

NOVEMBER 2014 | COMMERCIAL OFFICE MARKET

p.2 | Colliers International

Ho Chi Minh City led cities and provinces nationwide in attracting foreign direct investment (FDI) in the first 11 months of this year,

with a total registered and additional capital of US$2.78 billion, accounting for 20.8% of the country’s total figure.

Since there will be limit office developments scheduled for completion in the HCMC CBD during latter half of 2015, the current

upward trend for occupancy rate is expected to be sustained in 2015. Moreover, premium rents are forecasted to keep growing, as

landlords have become more optimistic that many expiring leases for office space in Central CBD are expected to be renewed, due

to the lack of alternative office space elsewhere.

Outlook

HCMC FDI GRoWTH, NoVEMBER 2014

Source: Colliers International

CBD oFFICE pERFoRMANCE BY ZoNE, NoVEMBER 2014



Grade AAR Occupancy rate Supply

A ↔ ↔ ↔

B ↔ ↔ ↔

B ↔

B ↔ ↔ ↔

B ↔ ↔ ↔

CITY CENTRAL

FINANCIALHUB

NORTHERN CBD

SOUTHERN CBD

Market PerformanceThe office market in CBD showed no significant movement

in recently month due to seasonal factor.

Grade A segment still stayed at high occupancy rate and

average asking rent. Moreover, the market recorded a

closer approach from effective rent to asking rent thanks

to limit in Grade A supply. Hence, the gap is narrowed and

stabilized at around US$2 per sq. m

At the same time, Grade B’s occupancy rate witnessed a

slightly decline in previous month, whilst average asking

rent grew nearly US$0.3 to US$23.7/ sq m/ month in

November.


NOVEMBER 2014 | COMMERCIAL OFFICE MARKET



OCTOBER 2014 | COMMERCIAL OFFICE MARKET

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

Office Market OverviewNo Name Address

Com-pletion Year

NLA (sq m)

Service Charges (*)

occupancy rate

NFA asking rent (*)

1 Saigon Centre 65 Le Loi 1996 11,650 6.5 98% 38.02 Saigon Tower 29 Le Duan 1997 13,950 6.0 91% 37.03 Sunwah Tower 115 Nguyen Hue 1997 20,800 6.0 95% 40.04 The Metropolitan 235 Dong Khoi 1997 15,200 6.0 93% 40.05 Diamond plaza 34 Le Duan 1999 15,936 8.0 99% 37.06 Kumho Asiana plaza 39 Le Duan 2009 26,000 8.0 93% 50.07 Bitexco Financial Tower 45 Ngo Duc Ke 2010 37,710 8.0 91% 35.08 president place 93 Nguyen Du 2012 8,330 6.0 88% 33.0

9 Times Square 22-36 Nguyen Hue 2012 9,000 7.0 86% 50.0

Grade A 158,576 7.0 93% 40.2

1 oSIC 8 Nguyen Hue 1993 6,500 6.0 98% 24.02 Yoco Building 41 Nguyen Thi Minh Khai 1995 5,000 4.0 100% 22.03 Somerset Chancellor Court 21-23 Nguyen Thi Minh Khai 1996 3,200 5.0 100% 22.04 Central plaza 17 Le Duan 1997 6,094 5.0 99% 24.05 Saigon Riverside office 2A-4A Ton Duc Thang 1997 10,000 5.0 98% 19.06 Saigon Trade Center 37 Ton Duc Thang 1997 31,416 6.0 77% 23.07 Harbour View Tower 35 Nguyen Hue 1997 8,000 5.0 81% 18.0

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 94% 21.010 Bitexco office Building 19-25 Nguyen Hue 2003 6,000 5.0 100% 24.011 The Landmark 5B Ton Duc Thang 2005 8,000 5.0 90% 20.012 opera View 161-167 Dong Khoi 2006 3,100 7.0 87% 27.013 petro Tower 1-5 Le Duan 2007 13,304 5.0 99% 30.014 City Light 45 Vo Thi Sau 2007 10,000 5.0 96% 16.015 The Landcaster 22Bis Le Thanh Ton 2007 7,000 5.0 100% 25.016 Gemadept Tower 5 Le Thanh Ton 2008 14,000 7.0 97% 24.017 Fideco Tower 81-85 Ham Nghi 2008 15,000 6.0 91% 18.018 Havana Tower 132 Ham Nghi 2008 7,326 6.0 96% 20.019 Sailing Tower 51 Nguyen Thi Minh Khai 2008 16,910 6.0 96% 22.0

20 Royal Center 235 Nguyen Van Cu 2008 14,320 5.0 100% 23.021 TMS 172 Hai Ba Trung 2009 4,000 4.0 100% 23.022 Bao Viet Tower 233 Dong Khoi 2010 10,650 6.0 99% 21.023 Green power Tower 35 Ton Duc Thang 2010 15,600 6.0 98% 22.024 Vincom Center 68-70-72 Le Thanh Ton 2010 56,600 5.0 92% 23.025 Saigon Royal 91 pasteur 2010 5,340 4.0 92% 20.026 A&B Tower 76 Le Lai 2010 17,120 6.0 95% 28.027 Maritime Bank Tower 192 Nguyen Cong Tru 2010 19.596 5.0 91% 23.028 Empress Tower 138 Hai Ba Trung 2012 19,538 6.0 97% 30.029 Lim Tower 9-11 Ton Duc Thang 2013 29,265 6.0 98% 27.030 Sunny MB Tower 259 Tran Hung Dao 2013 13,200 5.5 97% 25.0

Grade B 399,596 6.0 95% 23.7



NOVEMBER 2014 | CBD OFFICE MAP



NOVEMBER 2014 | RETAIL MARKET


NOVEMBER 2014 | CBD OFFICE MAP




Market Performance

Outlook

SHoppING CENTER MARKET pERFoRMANCE, NoV 2014

Following to The Nielsen Global Survey of Consumer Confidence

and Spending Intentions, consumer confidence in Vietnam

gained further momentum in the third quarter exceeding 100

points to stand at 102. Therefore, the retail market has been

tough, but the study showed some really positive signals, which

is fantastic leading up to Tet and into 2015.


RETAIL poDIUM MARKET pERFoRMANCE, NoV 2014


Source: GSO, Colliers International

According to the municipal Statistics office, HCMC’s Consumer

price Index (CpI) in october dropped 0.36% from october,

surged by 2.41% comparing with the same month previous

year. A fall was recorded in three groups and services in

the CpI basket with transport services down by 2.98% due

to continuous declines in petroleum price. In addition, a slight

decrease was recorded in the group of restaurants and catering

services due to big sale promotions launched by many shopping

malls in the city. It should be noted that over the past four

years, HCMC’s CpI in November saw rises in comparison to the

previous month but this year’s November witnessed reduction.

The closing of Tax Center is a main reason why the occupancy

rate of retail market went up in this November when the tenants

from there are moving to Union Square and Lucky plaza. In

specific, occupancy rate of shopping centre increase from 77%

in october to 84% in reviewed month. While the asking rent of

three segments including retail podium, department store and

shopping centre stayed unchanged comparing with previous

month.

overall, the retail sector within HCMC CBD area is still stagnant

reflecting in downturn performance of almost all retail centers.

pull back in consumer power and high rental rate put pressure

on retailers that force them to consolidate brands or move out

to shops on streets.

CpI AND RETAIL-SERVICE REVENUE GRoWTH, NoVEMBER 14

Source: GSO, Colliers International



NOVEMBER 2014 | CBD RETAIL MAP



NOVEMBER 2014 | HOTEL MARKET


NOVEMBER 2014 | CBD RETAIL MAP

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


NOVEMBER 2014 | HOTEL 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 90 100%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 60 93%4 Sheraton Saigon 88 Dong Khoi District 1 2002 750 125 67%5 opera View Lam Son Square District 1 2006 1,260 85 100%6 Kumho Asiana plaza 35 Le Duan District 1 2009 6,830 35 100%7 Rex Arcade 141 Nguyen Hue District 1 2010 2,000 120 100%8 ICoN 68 45 Ngo Duc Ke District 1 2011 8,000 40 80%9 president place 93 Nguyen Du District 1 2012 800 70 71%10 Times Square 22-36 Nguyen Hue District 1 2013 9,000 90 80%

Retail podium 29,990 65.3 87%

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 50 90%3 parkson Saigon Tourist 35 Le Thanh Ton District 1 2002 17,000 90 100%

Department Store 30,200 82.4 99%

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 Saigon Square 1 77-89 Nam Ky Khoi Nghia District 1 2006 1,300 167 100%

4 Nowzone Nguyen Van Cu District 1 2008 9,000 40 100%5 Saigon Square 2 7-9 Ton Duc Thang District 1 2009 1,400 90 80%6 Vincom Center B 72 Le Thanh Ton District 1 2010 45,000 65 80%

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

8 Union Square Dong Khoi District 1 2012 38,000 73 80%

Shopping Centre 113,450 67.2 84%

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

1 Caravelle 19 Lam Son Square District 1 2000 335 63% 1652 New World Saigon 76 Le Lai District 1 2000 533 59% 1103 Sofitel plaza Saigon 17 Le Duan District 1 2000 290 53% 1254 Rex 141 Nguyen Hue District 1 2000 289 53% 1055 Renaissance Riverside 8-15 Ton Duc Thang District 1 2001 350 67% 1206 Lotte Legend Hotel 2A-4A Ton Duc Thang District 1 2001 283 58% 1307 Sheraton 88 Dong Khoi District 1 2002 480 64% 2108 park Hyatt Saigon 02 Lam Son Square District 1 2005 259 85% 2369 Majestic Saigon 1 Dong Khoi District 1 2007 175 67% 13510 InterContinental Asiana 39 Le Duan District 1 2009 305 86% 21811 Nikko Saigon 235 Nguyen Van Cu District 1 2011 334 56% 11012 pullman Hotel 146 Tran Hung Dao District 1 2013 306 38% 108

5 Star 3,633 62% 148

1 Continental Saigon 132-134 Dong Khoi District 1 1990 86 72% 1002 Norfolk Hotel 117-119 Le Thanh Ton District 1 1992 104 75% 923 Duxton 63 Nguyen Hue District 1 1996 203 60% 754 Royal City 133 Nguyen Hue District 1 2000 135 66% 595 palace Saigon 56-66 Nguyen Hue District 1 2000 146 80% 556 oscar 68A Nguyen Hue District 1 2000 108 65% 407 Liberty Central 179 Le Thanh Ton District 1 2010 140 68% 908 Grand 08 Dong Khoi District 1 2011 107 64% 779 Liberty Central Riverside 17 Ton Duc Thang District 1 2013 170 57% 88

4 Star 1,161 67% 74.7



NOVEMBER 2014 | CBD HOTEL MAP



NOVEMBER 2014 | CBD HOTEL MAP




According to the Viet Nam National Administration of Tourism

(VNAT), Vietnam welcomed more than 7.2 million foreign

arrivals in the first 11 months of 2014, up 5.4% against the

same period last year. of the total, nearly 4.3 million foreigners

chose Vietnam as the destination for their vacations, while

more than 1.2 million others came for business purposes.

During January-November, the tourism sector served 36.4

million domestic tourists, up 8.9% y-o-y. Whilst the tourism

sector’s total revenue hit US$10 billion, an increase of 15.2%

comparing with the same period in 2013.

Following to the HCMC government’s figures, in the January-

october period, the city saw 3.9 million international tourists,

a y-o-y rise of 7%, and posted tourism revenues of VND78.7

trillion, a rise of 4% versus a year ago.

Thanks to a strong growth of foreign visitors, occupancy rate

of both 4- and 5-star segments have witnessed an increase

of 1% from 61%, 66% to 62%, 67% respectively in october.

However, a healthy supply of 3-star hotel sector in CBD put

a high pressure on hotel market when total top-tier’s units

in this area are overstock. At the same time, 5-star hotel’s

average room rate increased to 8% comparing with october

and rental rate of 4-star hotel had a slight increase of 5%

over the previous month. But, it should be mentioned that high

graded hotel segment’s rental rate went down nearly 23% from

the same period in 2012.

Hotel Market Overview

To maintain growth momentum, the city’s tourism sector will organize many programs including a food festival towards the year-

end, promote 100 interesting places and launch waterway tours, to lure more guests to the city.

At the end of the year, there have many kinds of festival which are considered that chances to help hotel owners make more profit

from F&B activities (Food and Beverage) and other services including conference, retail space.

NUMBER oF INTERNATIoNAL VISIToRS To HCMC, NoV 2014

Source: Statistical Office in HCMC, Colliers International

Outlook

pERFoRMANCE oF Top-GRADED HoTELS IN HCMC , NoV 2014

Source: Statistical Office in HCMC, Colliers International





NOVEMBER 2014 | SERVICED APARTMENT MARKET


pERFoRMANCE oF 5-STARS HoTEL, NoVEMBER 2014


pERFoRMANCE oF 4-STARS HoTEL, NoVEMBER 2014


HCMC has led the way in terms of cities attracting Foreign Direct Investment (FDI). Stable inflow of FDI capital makes the city an

economic hub of Vietnam with a large number of regional head offices located in the city and foreign nationals arriving for employment

or investment purposes. Moreover, blooming of private residential projects has hold off investment in serviced apartment in HCMC CBD

area in recent years due to faster return of investment capital. The latest development was built since 2011 and the most possible new

supply (100 units from Times Square) is expected to come on stream in 2015. Therefore, the serviced market in CBD is forecasted to be

in upward trend in next year.

Outlook

In November, the average asking rent of top graded serviced apartment remained stable when occupancy rate kept their upward trend.

In detail, Grade A’s vacancy rate was nearly 9%, a decrease of 2% comparing with october while occupancy rate of Grade B increased

1% to 83% in reviewed month.

Market Performance





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


NOVEMBER 2014 | SERVICED APARTMENT HCMC CBD MARKET REPORT


Serviced Apartment OverviewGRADE A CBD SERVICED ApARTMENTS pERFoRMANCE


GRADE B CBD SERVICED ApARTMENTS pERFoRMANCE


No project Name Address Location Comple-tion Year

Total Room

Average occupancy ARR(*)

1 The Landmark 5B Ton Duc Thang District 1 1995 66 85% 302 Somerset Chancellor Court 21-23 Nguyen Thi Minh Khai District 1 1996 172 92% 343 Sedona Suites 65 Le Loi District 1 1996 89 90% 304 Nguyen Du park Villas 111 Nguyen Du District 1 2004 41 96% 305 The Landcaster 22 Bis Le Thanh Ton District 1 2007 55 75% 376 InterContinental Asiana Saigon 39 Le Duan District 1 2009 260 96% 36

Grade A 701 91% 33.9

1 Somerset HCM 8A Nguyen Binh Khiem District 1 1998 165 78% 262 Saigon Sky Garden 20 Le Thanh Ton District 1 1998 154 90% 263 Norfolk Mansion 17-21 Ly Tu Trong District 1 1998 126 97% 334 Diamond plaza 34 Le Duan District 1 1999 42 95% 295 Garden View Court 101 Nguyen Du District 1 2000 76 84% 316 Ben Thanh Luxury 172-174 Ky Con District 1 2010 30 93% 18.57 Vincom Center 72 Le Thanh Ton District 1 2010 60 34% 26

8 Lafayette De Saigon 08 phung Khac Khoan District 1 2010 18 100% 29

9 Spring Court 1Bis phung Khac Khoan District 1 2011 14 86% 19

10 Nikko Saigon 235 Nguyen Van Cu District 1 2011 54 70% 28

11 Saigon City Residence 8A/3D2 Thai Van Lung District 1 2011 17 71% 34

Grade B 738 83% 27.1


NOVEMBER 2014 | CBD SERVICED APARTMENT MAP


HCMC CBD MARKET REPORT | NOVEMBER 2014

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HCMC CBD Market Report | Nov 2014

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Transcript of HCMC CBD Market Report | Nov 2014