vietnam research & forecast report | q42014 (en)

4Q 2014 | HCMC OVERVIEW

KNOWLEDGE REPORTHO CHI MINH CITY

www.colliers.com/vietnam

KNOWLEDGE REPORT | 4Q 2014 | HCMC | RETAIL

Accelerating success

VIETNAM 4Q14 Y-O-Y 1Q15FGDP Growth 6.96% 0.9%

Total Registered FDI (US$ billion) 9.05 37.0%

Exports (US$ billion) 40.40 12.8%

Imports (US$ billion) 40.80 17.2%

CPI 2.56% 3.4%

Total retail sales (VND thousand billion) 799.70 16.6%

International Visitors (million) 1 .82 12.5%

Base Rate 9% 0.0%

Exchange Rate (US$) 21 ,246 0.0%

VN-Index 547.93 8.6%

Gold Price (VND million/ tael) 35.37 1 .0%

4Q14 1Q15F*

Average asking rent

Occupancy rate

Supply

Only one new shopping centre came online

Hung Vuong Square which is located in District 5 came

online at the end of December. Although it has just been

opened, the occupancy reached 100% with Yeah 1 mall

as its major tenant. The current asking rent was US$55

per sqm per month.

MARKET PERFORMANCE BY AREA, 4Q14

Source: Colliers InternationalCBD recorded improvements in rent and occupancy rate

VIETNAM | 4Q14 | ECONOMIC UPDATE

Thanks to the improving economic conditions and the

increasing foreign retailers, the retail market showed

tentative signs of recovery in 4Q2014. Although the

median asking rent in CBD continued to show a y-o-y

drop of 6.0%, it slightly increased by nearly 3.0% q-o-q

thanks to the closure of Saigon Tax Trade Center in

November. Retailers’ movements from Saigon Tax

Trade Center partly helped increase the occupancy

rate which stood at 92.0%, a q-o-q rise of 8.0 percentage

points and a y-o-y rise of 5.7% percentage points.

The occupancy rate in non-CBD also increased thanks

to the expansion of both foreign and local retailers in

2014 such as AEON Mall and Central Group.

Knowledge Report

HCMC | Retail4Q 2014

Tentative signs of occupancy improvements

Rents are expected to be stable or slightly increase in

both CBD and non-CBD given limited supply in CBD

and increasing occupancy in non-CBD. However, the

not-so-good performance retail centres need to have

aggressive leasing strategies.

Looking forwards...

P.1 | Colliers International

KNOWLEDGE REPORT | 4Q 2014 | HCMC | RETAIL

Colliers View

Th e construction of Metroline No. 1 has had certain impacts

on the retail market in CBD. However, looking at a long-term

prospect, HCMC will remain a hot spot in the Asia Pacifi c. Th e

full open to wholly foreign retailers in 2015 will attract more

global brands although there will have fi erce competitions

between local and foreign players. Rents are expected to

stay fi rm given the lack of space availability in CBD and new

retailers in non-CBD.

MARKET PERFORMANCE BY YEAR

Source: Colliers International

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 60 100%4 Sheraton Saigon 88 Dong Khoi District 1 2002 750 125 67%5 Opera View Lam Son Square District 1 2006 1,260 50 94%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 45 90%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 (citywide) 62,054 54 86%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 (citywide) 120,367 52 91%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%9 Aeon Mall 30 Tan Thang Tan Phu 2014 49,000 15 100%

Shopping Centre (citywide) 401,182 41 96%

P.2 | Colliers International P.1 | Colliers International






CPI 2.56% 3.4%



Base Rate 9% 0.0%


VN-Index 547.93 8.6%


2015 outlook

Th e full open to 100% foreign-owned enterprises, access

to the Trans-Pacifi c Partnership (TPP) as well as free trade

agreements (FTA) with European Union (EU) in 2015,

will motivate a robust demand for the local offi ce market.

Due to some foreseeable delay in completions of some

developments in CBD in2015, the current upward trend of

occupancy rate is expected to be sustained in 2015.

GRADE A OFFICE PERFORMANCE, 4Q2014

Decentralisation continued to be recorded in 4Q2014


2014, particularly 4Q2014 showed a bright picture thanks

to the improving economy, limited supply as well as high

demand for offi ce space. At the end of 4Q2014, Grade A

buildings recorded the occupancy rate up to 92%, whilst

basic asking rent was stable at US$40.80 per sq m per

month, growing 3.0% y-o-y. Grade B witnessed a rise of

3.8% q-o-q and 5.1% y-o-y to US$19.70 per sq m per month

while the occupancy rate stood at 94.0%, 9.0 percentage

points lower than the previous quarter due to the new

supply (15,000 spm - net fl oor area).

With competitive rents and large available space,

decentralized districts are good destinations for companies

which need to expend their offi ce but have limited budget.

4Q2014 recored the operation of a new Grade B building

in District 5 – Lottery Tower. Th e project has 18 fl oors with

nearly 15,000 sq m net fl oor area for lease.

Source: Colliers International

Asking rents slightly increased in both Grade A and B

Knowledge Report

HCMC | Offi ce4Q 2014


KNOWLEDGE REPORT | 4Q 2014 | HCMC | OFFICE

Colliers ViewThe occupancy of Grade A Office is expected to remain stable given the limited supply and pre-commitment of some projects

which are expected to be completed in 2015.

Vietnam’s more integration in the world with more open policies will attract more international firms to the country. This will

help increase the office demand.

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 95% 37.02 Saigon Tower 29 Le Duan 1997 13,950 6.0 91% 35.03 Sunwah Tower 115 Nguyen Hue 1997 20,800 6.0 93% 45.04 The Metropolitan 235 Dong Khoi 1997 15,200 6.0 96% 42.05 Diamond Plaza 34 Le Duan 1999 15,936 8.0 100% 37.06 Kumho Asiana Plaza 39 Le Duan 2009 26,000 8.0 89% 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 96% 33.0

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

Grade A 158,576 7.0 93% 40.7

1 OSIC 8 Nguyen Hue 1993 6,500 6.0 97% 18.02 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 5.0 100% 24.05 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 77% 23.07 Harbour View Tower 35 Nguyen Hue 1997 8,000 5.0 87% 18.0

8 MeLinh Point Tower 02 Ngo Duc Ke 1999 17,600 6.0 98% 22.09 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 98% 20.012 Opera View 161-167 Dong Khoi 2006 3,100 7.0 85% 27.013 Petro Tower 1-5 Le Duan 2007 13,304 5.0 98% 30.014 City Light 45 Vo Thi Sau 2007 10,000 5.0 100% 15.015 The Landcaster 22Bis Le Thanh Ton 2007 7,000 5.0 90% 25.016 Gemadept Tower 5 Le Thanh Ton 2008 14,000 7.0 99% 24.017 Fideco Tower 81-85 Ham Nghi 2008 15,000 6.0 98% 22.018 Havana Tower 132 Ham Nghi 2008 7,326 6.0 100% 21.019 Sailing Tower 51 Nguyen Thi Minh Khai 2008 16,910 6.0 98% 26.0

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 6.0 100% 21.023 Green Power Tower 35 Ton Duc Thang 2010 15,600 6.0 96% 23.024 Vincom Center 68-70-72 Le Thanh Ton 2010 56,600 5.0 94% 22.025 Saigon Royal 91 Pasteur 2010 5,340 4.0 100% 20.026 A&B Tower 76 Le Lai 2010 17,120 6.0 99% 29.027 Maritime Bank Tower 192 Nguyen Cong Tru 2010 19.596 5.0 97% 22.028 Empress Tower 138 Hai Ba Trung 2012 19,538 6.0 100% 30.029 Lim Tower 9-11 Ton Duc Thang 2013 29,265 6.0 98% 28.030 Sunny MB Tower 259 Tran Hung Dao 2013 13,200 5.5 97% 25.0

Grade B 399,596 6.0 97% 24.0

P.4 | Colliers International * US$/ sq m/ month (on net area)






CPI 2.56% 3.4%



Base Rate 9% 0.0%


VN-Index 547.93 8.6%


4Q14 1Q15F*

Primary market

Secondary market

Supply

Sold rate

Prices continued to improve thanks to improving market conditions A healthy price increase was well maintained in 4Q

2014 thanks to good sales performance and gaining

market confidence. Primary prices of the mid-end and

affordable segments witnessed a high pace of 7.5% q-o-q

and 7.2% q-o-q respectively. Price improvement in the

secondary market was also observed.

LAUNCH SUPPLY AND PRIMARY PRICE

Source: Colliers InternationalImprovements in prices and sales volume continued in 4Q2014

New launches increased on both q-o-q and y-o-y basis


Recently positive changes in Housing Law and improving

macroeconomic conditions encouraged developers to start

launching their projects. 4Q 2014 witnessed 6,538 units

launched, showing a q-o-q rise of 106.8%. Th e mid-end

segment made the largest proportion (54.1%) and followed

by the aff ordable segment (38.6%). Accumulatively, 2014

recorded 14,950 launched units, the highest number during

the past three years.

Sales volume remained the upward trend

Th e residential market performed outstandingly in terms of

sales volume. 4Q 2014 recorded approximately 7,000 units

sold across all segments. Th is positive result was contributed

by fast sales rate of new launched projects, which are located

in good locations and developed by prestigious developers,

along with reasonable prices and acceptable unit size.

Th anks to the high potential for leasing out and increasing

capital value, the sales rate of Masteri Th ao Dien, Vinhomes

Central Park and Scenic Valley quickly reached over 70% of

launched units.

Knowledge Report

HCMC | Condominium4Q 2014


No Name of Project Developer Location Number of unit

Asking Price (US$/sqm) Grade

1 River Gate NovaLand District 4 132 1,800 - 2,300 High-end2 The Tresor NovaLand District 4 280 1,900 - 2,400 High-end3 Vinhomes Central Park (C1, C3) Vingroup Binh Thanh 878 1,800 - 2,000 High-end4 Scenic Valley (Block D2, E1) Phu My Hung District 7 270 1,500 - 1,650 Mid-end5 Masteri Thao Dien (T1, T2) Thao Dien Investment &partners District 2 1,449 1,357 - 1,400 Mid-end6 Soho Riverview SGCC - Hoa Binh Binh Thanh 105 1,200 - 1,204 Mid-end7 Tropic Garden - Phase 2 NovaLand District 2 207 1,273 - 1,425 Mid-end8 Docklands Saigon Paujar District 7 365 1,500 - 1,600 Mid-end9 Him Lam Riverside - Block D&E Him Lam Trading District 7 240 1,400 - 1,679 Mid-end10 Garden Gate NovaLand Phu Nhuan 272 1,471 - 1,800 Mid-end11 Orchard Gate NovaLand Phu Nhuan 154 1,540 - 1,700 Mid-end12 Topaz City Van Thai Co., Ltd. District 8 273 670 - 700 Affordable13 La Astoria An Gia Hung District 2 240 800 - 1,200 Affordable14 Him Lam Cho Lon Him Lam Trading District 6 396 930 - 1,100 Affordable 15 Sunview Town (Pearl Block) Dat Xanh Thu Duc 508 500 - 654 Affordable 16 Giai Viet Quoc Cuong District 8 312 849 - 991 Affordable 17 Khang Gia Chanh Hung Khang Gia JSC District 8 141 777 - 800 Affordable18 First Home Premium Thu Duc NHO Thu Duc 316 561 - 656 Affordable

New launches in 4Q2014 6,538

* Excluding all kinds of tax, promotions and management fee

Colliers ViewDevelopers showed more confidence in launching their developments thanks to favorable changes in Housing Law combined

with decreasing interest rates and recovering market confidence. The last quarter of 2014 witnessed 18 projects launched

with 6,583 units, the highest number in the recent quarters. Most noticeable developments include Vinhomes Central Park

(43ha) in Binh Thanh District and Masteri ThaoDien (8ha) in District 2.

The return of buyers especially investors have supported the increase in sales volume and resulted in price appreciations

at some projects. This trend is expected to continue given the improving market confidence driven by positive changes in

housing regulations, improving infrastructure and more quality products.

New launches are expected to increase further. This is particularly true for Districts 2, 9, Thu Duc and Binh Thanh

thanks to the improving infrastructure and high sales rate.

KNOWLEDGE REPORT | 4Q 2014 | HCMC | CONDOMINIUM

1 Star Hill (Phase 1 and 2) Phu My Hung Corp. District 7 411 2,000 - 2,350 High-end2 EverRich II - Phase 1 Phat Dat Co., Ltd. District 7 1,030 1,300 - 1,400 Mid-end3 Sunrise City - Phase 2 NovaLand Distric 7 520 1,600 - 1,700 Mid-end4 Ehome 3 (P2 - Block A3 - A4) Nam Long Binh Tan 392 800 - 812 Affordable5 My Phu Petroland District 7 286 700 - 749 Affordable

New completions in 4Q2014 2,639

P.6 | Colliers International P.5 | Colliers International

HCMC | DECEMBER 2014 | KNOWLEDGE REPORT

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vietnam research & forecast report | q42014 (en)

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