qmr brief - hanoi · qmr brief - hanoi gdp growth was 7.1% in 1h/2018, the highest 1h growth for...

QMR Brief - Hanoi

GDP growth was 7.1% in 1H/2018, the highest 1H growth for the last seven years. Industry and construction were

the main contributors, followed by the service sector.

Trade balance was positive with a surplus of US$2.7 billion due to strong export value of US$114 billion. The USA

and EU remain the main export markets.

Registered FDI was over US$20 billion in 1H/2018 with Japan being the largest contributor. Disbursed FDI reached

US$8.4billion, up 8% YoY.

International visitors were robust with 7.9 million, up 27% YoY.

QMR Brief - Hanoi

Source: Savills Research & Consultancy



RETAIL: RENT INCREASED ACROSS ALL SEGMENTS

Total stock was approximately 1.3 million m², up 0.6% quarter-

on-quarter (QoQ) and 4.4% year on year (YoY) from the entry of

the first shopping centre in Hoang Mai district providing 6,500 m².

Average ground floor gross rent increased 8.6% QoQ and 9.8%

YoY while occupancy was stable QoQ and up 7.1 ppts YoY. The

shopping centre segment had the most improved performance.

In 2H/2018, 11 new projects will enter the market, cumulatively

providing 98,000 m². Some projects with significant scale over

100,000 m² are scheduled to launch in 2019.

OFFICE: RENT INCREASED, OCCUPANCY STABLE

Total stock was over 1.6 million m², stable QoQ and up 1.8% YoY.

Over the past five years, stock has grown at an average 5.9% pa.

Average gross rents increased 2.4% QoQ and 4.3% YoY

whereas average occupancy was stable QoQ and up 0.6 ppts

YoY. Grade A registered the most improved occupancy while

Grade B saw the most improved rent.

2H/2018 will welcome 10 new projects supplying nearly 155,000

m², all fitting out and mostly located in the West. In 2019, another

120,000 m² from 12 new projects is expected to come online.

SERVICED APARTMENT: DYNAMIC SUPPLY WAVE

Total stock from 50 projects decreased -3% QoQ but rose 13%

YoY due to new launches, renewed units and a deactivated

project. From 2018 onwards, 1,860 units from 15 projects are

expected to become available.

Average occupancy was stable QoQ and down -3 ppts YoY.

Average room rates (ARR) increased 1.3% QoQ but dropped -

2.2% YoY. Cau Giay had the highest rent US$32/m²/mth while

projects in Hai Ba Trung had at the highest occupancy at 96

percent.

In 1H/2018, registered FDI to Ha Noi lead nation with US$5.9

billion, 59% higher than the inflow to HCMC.

FIGURE 3

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QMR Brief - Hanoi



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HOTEL: INTERNATIONAL VISITOR GROWTH

Total stock was approximately 10,000 rooms, stable QoQ and up

8% YoY.

Average occupancy slightly decreased -2 ppts QoQ and YoY.

ARR was down -4% QoQ and -5% YoY. Average revenue of five-

star hotels was US$108/room/night, double that of four-star and

four times of three-star.

According to the Ha Noi Statistics Office, in the first six months of

2018 there were approximately three million international visitors

to Ha Noi, a 26% YoY increase.

With 43 projects coming online from 2018, pressure is set to

increase across all grades.

APARTMENT: NEW SUPPLY AND HIGHER SALES

In Q2/2018, eleven new projects and next phases of 31 projects

launched 9,760 units, up 77% QoQ and 43% YoY. The primary

supply was 28,000 units, up 17% QoQ and 14% YoY.

Sales were up 31% QoQ and 11% YoY. Absorption rate

increased by 3 ppts QoQ but decreased -1 ppt YoY to 27 percent.

The average asking price was US$1,160/m², down -7% QoQ and

-12% YoY.

Grade B accounted for nearly 60% of total share, followed by

Grade C with 38 percent.

In 2H/2018, more than 14,300 units will enter the market from 20

projects, most of which are Grade B and Grade C.

VILLA/ TOWNHOUSE: STABLE PERFORMANCE

Total stock was 42,609 dwellings, increasing 3.7% QoQ and

12.8% YoY. Ha Dong continues to lead with a 23% market share,

followed by Hoai Duc.

Seven new projects and eight new phases supplied nearly 1,064

dwellings. Primary stock was approximately 3,451 dwellings, up

8.2% QoQ but down -12.9% YoY.

Sales were up 48% QoQ but down -9.4% YoY. Absorption was

34%, up 9.2 ppts QoQ and 1.3 ppts YoY.

From Q3/2018 to 2019, projects such as Vincity Gia Lam by

Vingroup and Smart Town by BRG-Sumitomo are expected to

enter the market.

FIGURE 6

FIGURE 5


FIGURE 4

30.41%

13.40%

8.93%

13.40%

4.55%

11.96%

17.4%Long Bien

Tu Liem

Tay Ho

Hoang Mai

Ha Dong

Hoai Duc

Other

QMR Brief - HCMC




RETAIL: F&B TREND GROWS

Total stock was over 1.2 million m2, with no new supply was

unchanged quarter-on-quarter (QoQ).

Average gross rent increased slightly 1% QoQ whilst occupancy

was stable due to flexible leasing terms to short-term tenants and

no new supply.

The market saw strong growth in retail sales of 10% year-on-year

(YoY); notably, F&B services grew 11.8% YoY, higher than last

year’s figure of 3.4 percent. Supporting this trend, the proportion

of F&B brands in large retail centers now ranges from 30-50

percent. In 2H/2018, a large amount of new supply will place

pressure on Districts 2, 7, Tan Binh and Binh Thanh.

OFFICE: LIMITED VACANCY, HIGHER RENT

One new Grade B and three Grade C offices delivered 28,700 m2.

Total office space reached almost 1.8 million m2, increasing 2%

QoQ and 10% YoY.

Overall performance continued to improve with an increase in rent

of 2% QoQ and 7% YoY. The surge was due to rent increments

seen in all grades. Average occupancy was stable at 96 percent.

By 2020, the market is expected to receive approximately 516,000

m2. Given the very low vacancy rates and lack of new supply,

Grade A and B office rents are forecast to increase over the

coming quarters.

SERVICED APARTMENT: HIGH-END SEGMENT OUTPERFORMED

Total supply was nearly 5,300 units, up 3% QoQ and 12% YoY.

Grade C had 155 new units from six projects and 30 units came

from a Grade B development.

Average occupancy decreased -1ppt QoQ whilst rent dropped -

1% QoQ. Despite the overall softer performance, Grade A

outperformed this quarter with average occupancy rising 2ppts

whilst rent remained stable QoQ.

There will be strong competition from projects with notable

developers and operators. In 2H/2018, nearly 600 units from six

projects will come on line; the majority are high-end with good

management.

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QMR Brief - HCMC



HOTEL: STRONG IMPROVEMENTS

Stock was slightly down -2% YoY to 16,250 rooms due to the

closure of four 3-star projects.

Average occupancy peaked at 67%, the highest for a low season

in the last five years, whilst the average room rate (ARR) was

stable QoQ and up 7% YoY. Due to significant growth in

international arrivals, all segments had improvements in

occupancy rates and ARR.

According to the HCMC Tourism Department, the city welcomed

3.8 million international visitors in 1H/2018, up 27% YoY. China

and Korea remain the leading source markets.

APARTMENT: TRANSACTIONS POWER ON

Sixteen new projects and 10 new phases supplied approximately

10,600 units, up 125% YoY. Primary supply was over 25,400

units, down -11% QoQ and -30% YoY.

Strong overall market performance achieved approximately

14,400 transactions, up 6% QoQ and 22% YoY. Grade B

performed well with an increase of 16% QoQ and 61% absorption.

Grade C remained the market driver, with 60% of total

transactions. Absorption was at 56%, up 9ppts QoQ and 24ppts

YoY.

Until 2020, over 129,100 units from 97 projects will be supplied;

District 9 is expected to have greatest proportion with a 31%

share.

VILLA/TOWNHOUSE: TOWNHOUSE PERFORMED WELL

Five new projects and seven new phases supplied over 1,000

dwellings. Primary stock was approximately 1,680 dwellings, up

15% QoQ and -14% YoY. Transactions were up 25% QoQ and

35% YoY. Townhouses performed well with an absorption rate of

71 percent.

Primary land plots supplied more than 2,870 plots this quarter with

an absorption rate of 68 percent. New projects performed well,

accounting for 60% of total transactions. Cu Chi contributed 48%

of sales.

Till 2020, new supply will be approximately 16,300

dwellings/plots. The Eastern Zone (District 9 & District 2) and Cu

Chi will contribute 65% of total future supply.

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Townhouses Villas

QMR Brief – Hanoi

QMR Brief - HCMC

QMR Brief – Hanoi

QMR Brief - HCMC

qmr brief - hanoi · qmr brief - hanoi gdp growth was 7.1% in 1h/2018, the highest 1h growth for...

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