VIETNAM REAL ESTATE - TIME TO RECALIBRATE Presented by: Marc Townsend Managing Director, CBRE Vietnam 2 nd July, 2015

Transcription

1 VIETNAM REAL ESTATE - TIME TO RECALIBRATE Presented by: Marc Townsend Managing Director, CBRE Vietnam 2 nd July, CBRE VIETNAM REAL ESTATE TIME TO RECALIBRATE JULY 2015 *All the above articles were retrieved in June

2 10 May 2015 Ironman 70.3 Vietnam in Da Nang 13 May 2015 Son Doong Cave was broadcast in Good Morning America 3 CBRE VIETNAM REAL ESTATE TIME TO RECALIBRATE JULY 2015 *All the above articles were retrieved in June Economic Outlook

3 VIETNAM S GDP GROWTH TO QUICKEN, INFLATION EASE Gross Domestic Product, Vietnam 25% 20% 15% 10% 5% 8.4% 8.2% 8.5% 6.3% 5.3% 6.8% 5.9% 5.0% 5.4% 6.0% 6.3% Highest GDP in five years 0% M 2015 Real GDP growth rate Annual average inflation Inflation eased to a ten-year low Source: Vietnamese General Statistical Office, Q CBRE VIETNAM REAL ESTATE TIME TO RECALIBRATE JULY 2015 FTAs BOOST GDP GROWTH Estimated boost to GDP from TPP (as a % of baseline GDP) Source: Peter A. Petri, Michael G. Plummer and Fan Zhai, "The Trans Pacific Partnership and Asia-Pacific integration: A quantitative Assessment" 6 CBRE VIETNAM REAL ESTATE TIME TO RECALIBRATE JULY 2015

4 STRONGER CURRENCY Forecasted Change in APAC currencies against the US Dollar Source: CBRE Research, Marcobond, Oxford Economics, May USD/VND Interbank Exchange Rate 22,000 20,803 20,668 21,000 20,000 19,000 18,932 18,000 21,036 21,24621,458 21,673 17,000 Dec-10 7 CBRE VIETNAM REAL ESTATE TIME TO RECALIBRATE JULY 2015 Jun-11 Dec-11 Jun-12 Dec-12 Jun-13 Dec-13 Jun-14 Dec-14 Jun-15 RETAIL SALES SHOW MODEST GROWTH Vietnam Retail Sales No. of cars 160, ,000 80,000 40,000 - Vietnam Car Sold Car importers will have to pay for emission test No. of cars sold % change YoY % 120% 70% 20% -30% Growth rate Turnover (Trillion dong) 3,500 3,000 2,500 2,000 1,500 1, % 36% 30% 24% 18% 12% 6% 0% Growth Rate (%) 1: 1 Registration fee reduced from 10% - 20% to 10% - 15% in April. 2: 2 Import duty on cars from ASEAN countries will decrease from 50% to 0% by M 2015 Retail and Services Turnover Retail and Services Turnover Growth Source: Vietnam Automobile Manufacturer s Association, June 2015; Vietnamese General Statistical Office, Q CBRE VIETNAM REAL ESTATE TIME TO RECALIBRATE JULY 2015

5 FURTHER CUTS IN BANK INTEREST RATES Vietnam Interest Rates Interest rate (%) Mortgage rate for the first 12 months: Jan. 15 June 15 Techcombank 9.49% 7.99% Vietcombank 7.99% 7.3% ACB 8.90% 8.0% Base rate Rediscounting rate Refinancing rate Lending rate Deposit rate Lending rate: Average lending rate for enterprises. Source: Vietnamese General Statistical Office, State Bank of Vietnam. 9 CBRE VIETNAM REAL ESTATE TIME TO RECALIBRATE JULY 2015 STEADILY RISING STOCK MARKET Vietnam Stock Market, VNIndex 2015 VIETNAM TOP 50 LISTED BEST PERFORMERS *out of 700 companies in HNX and HOSE 4 Vingroup (VIC) HCMC Infrastructure Investment JSC. (CII) Dat Xanh Real Estate Service (DXG) FLC Group (FLC) Source: Cafef.vn 50 Ha Do JSC (HDG) INDEX OF REAL ESTATE SECTOR IN 1 YEAR 10 CBRE VIETNAM REAL ESTATE TIME TO RECALIBRATE JULY 2015 Source: Stockbiz

6 NOT ALL WINE AND ROSES Foreign Direct Investment 10,000 8,000 6,000 4,000 2,000 0 Q Q Q Q Q Q Q Q Q Q Q Q Q Q FDI (US$ millions) International arrivals Million arivals FDI (Registered) Q Q Q Q Q Q Q Q Q Q Q Q Q Q International arrivals FDI (Implemented) Growth rate Source: Tourism Working Group, Vietnamese General Statistical Office, Q % 40% 25% 10% -5% -20% Growth rate Int l arrivals and growth rate, countries in the region Countries 2014 Int l arrivals change Malaysia 27,437, % Thailand 24,779, % Singapore 15,086, % Indonesia 9,300, % Vietnam 7,874, % Philippines 4,833, % 11 CBRE VIETNAM REAL ESTATE TIME TO RECALIBRATE JULY 2015 FUTURE GROWTH POTENTIAL Vietnam to become a mid-manufacturing country? ASEAN s three sub-regions /LVMC Vietnam Trade Balance US$ billion Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q Export Imports Vietnam Export Structure, 6M 2015 vs. 3.22% in 2010 Mobile phones and appliances 19% Garments & textiles Source: ASEAN s rise in the global economy, ANZ Research. 39% 13% Shoes Electronics, computers and parts Crude oil 8% Seafood 5% 4%3% 9% Machinery and parts Others Source: Vietnamese General Statistical Office, Q CBRE VIETNAM REAL ESTATE TIME TO RECALIBRATE JULY 2015

7 BCI NUMBERS Projects under construction, y-o-y change All future projects ( ), y-o-y change Percentage change 400% 300% 200% 100% 0% -100% 2015 YTD vs vs 2013 HCMC Hanoi Da NangCan Tho Khanh Hoa Vung Tau Hai Phong Percentage change 300% 200% 100% 0% -100% 2015 YTD vs vs 2013 HCMC Hanoi Da Nang Can Tho Khanh Hoa Vung Tau Hai Phong Projects Under Construction HCMC Hanoi Da Nang Can Tho Nha Trang Vung Tau Hai Phong All Future Projects ( ) HCMC Hanoi Da Nang Can Tho Nha Trang Vung Tau Hai Phong Office Retail Office Retail Hospitality and SA Hospitality and SA Residential Total Source: CBRE Vietnam, June 2015 Residential Total Source: CBRE Vietnam, June CBRE VIETNAM REAL ESTATE TIME TO RECALIBRATE JULY Infrastructure Investment

8 METRO LINE FAST PROGRESS IN HCMC HCMC Hanoi Ben Thanh Suoi Tien Station no. 14 Suoi Tien bus Km Station no. 13 Suoi Tien Km Station no. 12 Hi-Tech industrial park Km Hanoi to buy 13 China-manufactured trains for urban railway station Station no. 11 Thu Duc Km Station no. 10 Binh Thai Km Station no. 9 Phuoc Long Km Station no. 8 Rach Chiec Km Station no. 7 An Phu Km Station no. 6 Thao Dien Km Station no. 5 Tan Cang Km Station no. 4 Van Thanh Park Km Girders Installed On Metro Line 1 Cat Linh Depot under construction Station no. 3 Ba Son Km Station no. 2 Opera House Km Station no. 1 Ben Thanh Km Pictures taken on 25-Jun Hanoi s Wavy Metro Tracks Raise Eyebrows 15 CBRE VIETNAM REAL ESTATE TIME TO RECALIBRATE JULY 2015 AIRPORTS AND PORTS Long Thanh Airport gets green light from Party leaders Phu Quoc International Passenger Port Construction starts 29 April 2015 Construction period Capacity Cruise liners carrying 5,000-6,000 visitors or 20,000- tonne cargo ships Investment capital VND1.64 trillion (US$76.4 million) 16 CBRE VIETNAM REAL ESTATE TIME TO RECALIBRATE JULY 2015

9 HIGHWAYS AND ROADS 17 CBRE VIETNAM REAL ESTATE TIME TO RECALIBRATE JULY Regulation Changes

10 EFFECTIVE FROM 1 ST JULY, 2015 Residential Properties - Opens Door for Foreign Buyers Marc, FAQs I am an individual investor from Hong Kong. I will visit HCMC next week and would like to know the following: 1) Background: Legal basis for foreign ownership of residential units (and whether this varies as value and or number of units increases) Typical legal and agent fees upon purchase/ sale Likely taxes/stamp duty etc. including capital gains tax, tax on rental income. Typical insurance costs 2) Deal: Available properties and typical asking prices A view on best locations for our purpose Likely realisable rents and demand for properties Property management fees 3) Deal exit: Buying a condo Tax rules upon sale (as individual entity) in Vietnam Restrictions on sale e.g. property holding A guide period for Restrictions on repatriating capital or foreigners profits out of Vietnam Regards, All you need to know LAW ACCOUNTS TRANFERRING FUNDS DOCUMENTS REQUIRED KEY TIPS 19 CBRE VIETNAM REAL ESTATE TIME TO RECALIBRATE JULY 2015 VINHOMES LAUNCHING EVENT 20 CBRE VIETNAM REAL ESTATE TIME TO RECALIBRATE JULY 2015

11 EFFECTIVE FROM 1 ST JULY, 2015 Commercial Properties - Bigger battlefield with more players Lease properties for sub-lease Existing law From July 2015 Foreign invested firms not allowed to sub-lease rented properties Foreign invested firms can sub-lease properties that they are renting Acquire completed buildings for own use Existing law From July 2015 Foreign invested firms can only own a building if they are the developer Foreign invested firms can acquire and own a completed building for own use 21 CBRE VIETNAM REAL ESTATE TIME TO RECALIBRATE JULY 2015 EFFECTIVE FROM 1 ST SEPTEMBER, % Foreign Ownership Limit for Listed Companies On 25-June 2015, the Prime Minister of Vietnam gave the final seal of approval to changes in the Law on Securities to allow for a significant relaxation of foreign ownership limits ("FOL") for Vietnam listedequities. FOL for public and listed companies (as well as for securities companies and investment funds) will be increased from 49% to 100% except banks, which will continue to be limited to 30% until further notice from the PM, and except for sensitive sectors or where the state retains a controlling stake. Among 73 listed companies in real estate sector 42 companies have foreign shares 9 companies have foreign shares greater than 20% 19% 12% Foreign ownership greater than 20% Foreign ownership less than 20% 68% 100% local Source: CBRE Vietnam, June CBRE VIETNAM REAL ESTATE TIME TO RECALIBRATE JULY 2015

12 4 Condominium Market CONDOMINIUM FOR SALE Optimism ahead of regulation changes Developers and buyers remain bullish 15,715 units launched in 1H % y-o-y 10,187 units launched in 1H % y-o-y Absorption Rate 10,494 units (of new launches) sold in 1H % HCMC 5,130 units (of new launches) sold in 1H % HANOI 24 CBRE VIETNAM REAL ESTATE TIME TO RECALIBRATE JULY 2015

13 CONDOMINIUM FOR SALE Continued strong interest in new launches 21 June 2015 Landmark 4 launching event in HCMC 10 June 2015 Gateway Thao Dien launching event in HCMC 10 May The most attractive Investment opportunity 2015 event in Hanoi, Vinpearl Premium Villas 19 May Estella Heights launching event in HCMC 9 May 2015 Masteri Thao Dien, Block T3 launching event in HCMC 25 CBRE VIETNAM REAL ESTATE TIME TO RECALIBRATE JULY 2015 CONDOMINIUM FOR SALE Busy Launches in Q2 2015: 19 projects 8,528 units launched ~57% sold Highest number of launches ever for a single quarter Continued to move to the East! 19% q-o-q 126% y-o-y 1H 2015: 15,715 units Whole year 2010: ~20,000 units Whole year 2007: ~10,300 units HCMC Project(s) Units , , Implication for districts only, not exact project location 26 CBRE VIETNAM REAL ESTATE TIME TO RECALIBRATE JULY 2015

14 CONDOMINIUM FOR SALE Busy launches HANOI More projects in the West but bigger developments in the East! Q2/2015: 19 new launches 5,137 units launched (*) Q1/2015: 18 new launches 5,050 units Ba Dinh 2 projects 160 units 4 projects 819 units 2 projects 130 units 2 projects 320 units 3 projects 470 units 1 project 129 units 4 projects 1,911 units 1 project 1,198 units 27 CBRE VIETNAM REAL ESTATE TIME TO RECALIBRATE JULY 2015 CONDOMINIUM FOR SALE Optimism ahead of anticipation on regulation changes Sold Units, HCMC 20,000 15,000 10,000 5,000 Sold Units, Hanoi 20,000 15,000 10,000 5, H H 2015 Highest take-up for a single quarter Q2 2015: ~10,000 units (both new and previous launches) Highest take-up for a single quarter Q2 2015: ~4,500 units (both new and previous launches) 28 CBRE VIETNAM REAL ESTATE TIME TO RECALIBRATE JULY 2015

15 CONDOMINIUM FOR SALE Solid Recovery Take-up per period, HCMC Take-up per period, HANOI 100% 100% 80% 80% 60% 60% 40% 40% 20% 20% 0% H 2015 High-end Mid-end Affordable 0% H 2015 High-end Mid-end Affordable 29 CBRE VIETNAM REAL ESTATE TIME TO RECALIBRATE JULY 2015 CONDOMINIUM FOR SALE District 4 An Emerging Cluster The Tresor Novaland 459 units US$2,550-$3,050 psm Icon 56 Novaland 312 units US$2,617-$3,105 psm Galaxy 9 Novaland ~500 units US$1,500-$1,696 psm RiverGate Novaland 319 căn hộ US$2,039-$2,512 psm The Gold View TNR Holdings 1,760 units US$1,529-$1,609 psm 56 units per floor District 4 District 1 *Asking prices are quoted exclusive of VAT and maintenance fee 30 CBRE VIETNAM REAL ESTATE TIME TO RECALIBRATE JULY 2015

16 CONDOMINIUM FOR SALE New vs. Old Products HCMC Primary vs. Secondary Price of Typical Condominiums in HCMC $2,200 Selling Price (US$ psm) $2,000 $1,800 $1,600 $1,400 Q Q Q Primary Asking Price Secondary Asking Price The Manor-Phase 1 Saigon Pearl - Sapphire The Vista An Phu Thao Dien Pearl Cantavil Premier Masteri Thao Dien Estella Heights Vinhomes Central Park Gateway Thao Dien HCMC 1H 2015 Launched 15,715 units Sold 10,494 units (for only new launches in the review period) Absorption Rate 67% 31 CBRE VIETNAM REAL ESTATE TIME TO RECALIBRATE JULY 2015 CONDOMINIUM FOR SALE Primary Prices Increase while Secondary Prices Stay Flat Primary vs. Secondary Price of Typical Condominiums in Hanoi Selling Price (US$ psm) $2,400 $2,200 $2,000 $1,800 $1,600 $1,400 Primary Asking Price Secondary Asking Price Royal City Times City Golden Land Building Discovery Complex Park Hill Hoa Binh Green City $1,200 Q Q Q Imperia Garden Watermark Tower 32 CBRE VIETNAM REAL ESTATE TIME TO RECALIBRATE JULY 2015

17 CONDOMINIUM FOR SALE Vietnam s Price Competitiveness Primary Asking Price (US$ psm) $8,000 $7,000 $6,000 $5,000 $4,000 $3,000 $2,000 $1,000 $0 Hanoi HCMC Phnom Penh Manila Jakarta Bangkok Luxury High-end Mid-end Affordable 33 CBRE VIETNAM REAL ESTATE TIME TO RECALIBRATE JULY Commercial Properties

18 OFFICE HCMC - Steady Supply Across All Grades Q Grade A Grade C Grade B VIETCOMBANK TOWER GFA: 55,000 sm ROBOT TOWER GFA: 3,200 sm LIM TOWER 2 GFA: 20,467 sm 35 CBRE VIETNAM REAL ESTATE TIME TO RECALIBRATE JULY 2015 OFFICE The Rise of Strata Title Broadening Long-term Leases In Occurrence of long term lease/ selling office space 2015 onwards.more office space for sale SAIGON AIRPORT PLAZA SUNRISE CITY CENTRAL TOWER GALAXY 9 PETROLAND TOWER HEI TOWER PRINCE RESIDENCE RIVERGATE TOWER LUCKY PALACE PEARL PLAZA DIAMOND FLOWER TOWER PVI TOWER TNR TOWER HUD TOWER DISCOVERY COMPLEX 36 CBRE VIETNAM REAL ESTATE TIME TO RECALIBRATE JULY 2015

19 STRATA TITLED OFFICES Office Yields SAIGON AIRPORT PLAZA Rent: US$15/month Long term rent: 1,750 US$/sm/term Term: 2059 PRINCE RESIDENCE Asking price: VND850 million per lot Sub-lease rent: VND10mil per month Term: 2064 PEARL PLAZA Rent: US$15/month Long term rent: 1,500 US$/sm/term Term: 2058 Office yields 10% - 14% VS. Vietnamese government 10-year bond yield 6.8% (*) (*) as of end of June CBRE VIETNAM REAL ESTATE TIME TO RECALIBRATE JULY 2015 OFFICE HCMC - CBRE LEAD AGENCIES Grade B Grade C Grade B Grade A ROBOT TOWER GFA: 3,200 sm PEARL PLAZA GFA: 37,434 sm LIM TOWER 1 GFA: 20,467 sm LIM TOWER 2 GFA: 20,467 sm CBRE VIETNAM REAL ESTATE TIME TO RECALIBRATE JULY 2015

20 OFFICE Big office space HCMC vs. Hanoi Available space per building (grade A/B) HCMC Number of buildings Hanoi > 3,000 sm ,000-3,000 sm 2 7 1,000-2,000 sm ,000 sm 7 12 Tenant preferred size (base on CBRE s enquiry) HANOI HCMC 15% 20% 1H % 26% 16% 4% 1H % 46% Currently, lack of big office space in Grade A and B office buildings in HCMC 39 CBRE VIETNAM REAL ESTATE TIME TO RECALIBRATE JULY 2015 OFFICE Rental Stabilization but for how long? HCMC Grade A Hanoi US$/sm/month US$/sm/month 2008 period US$/sm/month Narrower rental Gap btw HCMC & HN for now, but not for long! US$/sm/month 2012 & & 2017 Upward pressure 0 90 Limited quality supply in HCMC while multiple good quality, fringe CBD mixed use developments in Hanoi Downward Pressure CBRE VIETNAM REAL ESTATE TIME TO RECALIBRATE JULY 2015

21 OFFICE The flight to quality Green is a given, Wellness, a must. Green one UN house (Hanoi) President Place (HCMC) Deutsches Haus (HCMC) FPT office building (Da Nang) 41 CBRE VIETNAM REAL ESTATE TIME TO RECALIBRATE JULY 2015 OFFICE Upcoming Supply in 2H 2015 HA NOI Grade A TNR TOWER Dong Da Dist. GFA: 56,000 sqm Grade B DIAMOND FLOWER Cau Giay Dist. GFA: 20,000 sqm Grade B HUD TOWER Cau Giay Dist. GFA: 56,000 sqm Grade B HANDICO TOWER South Tu Liem Dist. GFA: 29,040 sqm Grade B Grade C Grade C HCMC PEARL PLAZA GFA: 37,434 sm HAI NAM OFFICE BUILDING GFA: ~8,000 sm PT BUILDING GFA: 1,000 sm 42 CBRE VIETNAM REAL ESTATE TIME TO RECALIBRATE JULY 2015

22 OFFICE Grade A buildings are expected to Open in HCMC in next 3 years Grade A Grade A THE ONE GFA: 15,000 sm Open: 2018 DEUTSCHES HAUS GFA: 40,000 sm Open: 2017 Grade A SAIGON CENTRE (PHASE 2) GFA: 40,000 sm Open: CBRE VIETNAM REAL ESTATE TIME TO RECALIBRATE JULY 2015 RETAIL HCMC Newly opened/closed in Q2/2015 HANOI Newly opened in Q SC VivoCity Nguyen Van Linh Street, District 7 GFA: 72,000 sm Opened: May 2015 Times Square 36 Nguyen Hue, District 1 GFA: 4,000 sm GFA: 23,800 sqm Location: Ho Guom Plaza, Ha Dong Occupancy: 84% The 5 th hypermarket in Hanoi The 31 st in Vietnam Opened: June 2015 Saigon Centre Le Loi, District 1 GFA: 6,250 sm Closed for renovation: June 2015 (for 1 year) Saigon Square 2 To Duc Thang, District 1 GFA: 7,750 sm Closed for renovation: April 2015 Union Square Dong Khoi Nguyen Hue, District 1 GFA: 39,454 sm Closed to re-merchandise and relayout: October 2015 (for 1 year) 44 CBRE VIETNAM REAL ESTATE TIME TO RECALIBRATE JULY 2015

23 RETAIL 1 store expected to open in Can Tho, July 74 stores within a year VinDS 300 stores within 3 years NEW ENTRY IN HCMC IN CBRE VIETNAM REAL ESTATE TIME TO RECALIBRATE JULY 2015 RETAIL A Breakthrough Retail Format in HCMC 46 CBRE VIETNAM REAL ESTATE TIME TO RECALIBRATE JULY 2015

24 RETAIL Upcoming supply in HCMC in 2H2015 Retail Supply by year, HCMC Existing Future 800, , , , , , , , Retail Supply by year, Regional Vincom Quang Trung Quang Trung Str. 27,000 sm GFA Vincom Megamall Hanoi Highway 120,000 sm GFA 6,000,000 5,000,000 4,000,000 3,000,000 2,000,000 Pearl Plaza Dien Bien Phu Str. 20,579 sm GFA 1,000,000 - Bangkok Singapore Jakarta Hanoi HCMC Thasa Plaza Nguyen Hue Str. ~6,000 sm 47 CBRE VIETNAM REAL ESTATE TIME TO RECALIBRATE JULY 2015 RETAIL Upcoming supply in Hanoi in 2H2015 Retail Supply by year (sqm) 900,000 Existing Future 800, ,000 Vincom Nguyen Chi Thanh Location: Dong Da Dist. 44,500 sqm GFA 600, , , , , ,000 Vincom Exchange City Location: Tu Liem Dist. 23,140 sqm GFA AEON MALL Location: Long Bien Dist. 108,000 sqm GFA 48 CBRE VIETNAM REAL ESTATE TIME TO RECALIBRATE JULY 2015

25 CONSUMER SURVEY PART 2 Consumers shop online to avoid going to a shop Vietnam: 73% consumers shop online to avoid going to a shop Vietnam: average online monthly spending USD26-50 /person Source: CBRE Asia Pacific Consumer Survey, June CBRE VIETNAM REAL ESTATE TIME TO RECALIBRATE JULY 2015 HOSPITALITY Ascott to expand more aggressively in the coming years 2017/2018 Somerset TD Hai Phong 132 units Somerset West Central 2015 Somerset Da Nang Bay 121 units 2016 Ascott Waterfront Saigon 222 units Citadines Regency Saigon 200 units 2016 NEW BRAND! 2018 NEW BRAND! Source: CBRE Vietnam & The Ascott Ltd., Q CBRE VIETNAM REAL ESTATE TIME TO RECALIBRATE JULY 2015

26 HOSPITALITY Vietnam will set up a US$100 million fund to promote tourism 1H2015 Int l arrivals growth y-o-y 8.8% 3% HANOI HCMC Malaysia Thailand Singapore Indonesia Vietnam Philippines Cambodia Lao PDR Myanmar Brunei Int l Arrivals (2014) Millions Visa exempt/free * Source: Tourism Working Group. *Most current data including five European countries. 51 CBRE VIETNAM REAL ESTATE TIME TO RECALIBRATE JULY 2015 HOSPITALITY Coastal Cities The second tower of The Grand under construction at Ho Tram Q Q China China Da Nang Da Nang 40%-50% 65%-70% Of total international flights per week 52 CBRE VIETNAM REAL ESTATE TIME TO RECALIBRATE JULY 2015

27 HOSPITALITY New hotel brands to Da Nang Hosting APEC 2017 is good news for Da Nang City as this is a chance to promote the city's image to the world, promising greater number of visitors from various countries and positive impacts on the city's hospitality market. Hilton and JW Mariott to push up project construction to meet the APEC Market is expected to have totally 13,404 keys till Future supply is dominated by beach-front developments. 53 CBRE VIETNAM REAL ESTATE TIME TO RECALIBRATE JULY Investment - In Search of Right Partner

28 INVESTMENT TRANSACTIONS *All the above articles were retrieved in June CBRE VIETNAM REAL ESTATE TIME TO RECALIBRATE JULY 2015 MARKET CONSOLIDATION 56 CBRE VIETNAM REAL ESTATE TIME TO RECALIBRATE JULY 2015

29 VIETNAM INVESTMENT MARKET Significant projects opene Sailing Tower Market Peak Saigon Luxury Apartment 20 golden sites introduced Kumho Asiana Centec Tower Vincom Dong Khoi Development sites (Land cost) Ready-built project (Land cost + construction cost) Bitexco Financial Tower Union Square Times Square Le Meridien Vietcombank Tower YTD Significant transactions of development sites in District ,010 2,203 13,000-58,000 10,000-22,000 4,500 Historical transactions Value (US$ million) CBRE VIETNAM REAL ESTATE TIME TO RECALIBRATE JULY 2015 No. of transactions Source: Real Capital Analytics, retrieved in June LAND VALUES HANOI HCMC 40,000 Hoan Kiem Ba Dinh Cau Giay 40,000 District 1 D3 D4 35,000 35,000 Price psm of land area 30,000 25,000 20,000 15,000 10,000 5, Price psm of land area 30,000 25,000 20,000 15,000 10,000 5,000 0 Plot ratio: Price quoted is current asking price. Source: CBRE Vietnam, Q Usage Mixed-use Commercial Residential Land area >5,000 sm 1,000-5,000 sm <1,000 sm 58 CBRE VIETNAM REAL ESTATE TIME TO RECALIBRATE JULY 2015

30 2015 OUTLOOK SECTOR OFFICE RETAIL CONDOMINIUM SEGMENT New buildings Mature buildings CBD Non-CBD High-end Mid-end Affordable HCMC HANOI RENT/PRICE ABSORPTION RENT/PRICE ABSORPTION HOTEL Inner-city hotels Beach hotels/resorts SERVICED APT. Grade A INDUSTRIAL Land Factory/ warehouse 59 CBRE VIETNAM REAL ESTATE TIME TO RECALIBRATE JULY OUTLOOK SECTOR OUTLOOK CONDOMINIUM OFFICE RETAIL HOSPITALITY Sales continue to be strong. High-end and luxury projects continue to grab the headlines Should we be worried about an over-hyped market? Rent remains stable thanks to limited supply. Grade B+ office buildings are getting more competitive to Grade A thanks to their more favourable rental rates. Take-up rates of these buildings are also expected to expand much bigger than these of Grade A. Tenants no longer switch offices just because of cheaper rent, which has been the main trend in the years from They will only move office when they need a larger space or looking for places with higher utilities. The market will welcome many new customers as investors when the revised Law on Real Estate Business takes effect from July 1. Increasing supplies in the next two quarter, especially from non-cbd locations. Rental rate is expected to further improve thanks to good performance of new supplies. Securing anchor tenant is key of differentiation. The market continues to be dominated by mid-scale segment. Second home market is expected to revive not only in established areas like Da Nang, Nha Trang but also in emerging destinations like Phu Quoc and Ha Long. Second home market in the North starts to emerge and develop but it might take some time for the market to be as active as in Da Nang or Nha Trang. 60 CBRE VIETNAM REAL ESTATE TIME TO RECALIBRATE JULY 2015

31 AT CBRE, WE LIVE AND BREATHE THE BUSINESS OF REAL ESTATE Every quarter QUARTERLY REPORT Ad-hoc VIEWPOINT & SPECIAL REPORT Every week NEWS UPDATE Every month DASHBOARD Every quarter MARKETVIEW 61 CBRE VIETNAM REAL ESTATE TIME TO RECALIBRATE JULY 2015 For more information regarding this presentation please contact: CBRE Vietnam Co., Ltd. Research & Consulting T F research.vietnam@cbre.com All materials presented in this report, unless specifically indicated otherwise, is under copyright and proprietary to CBRE. Information contained herein, including projections, has been obtained from materials and sources believed to be reliable at the date of publication. While we do not doubt its accuracy, we have not verified it and make no guarantee, warranty or representation about it. Readers are responsible for independently assessing the relevance, accuracy, completeness and currency of the information of this publication. This report is presented for information purposes only, exclusively for CBRE clients and professionals, and is not to be used or considered as an offer or the solicitation of an offer to sell or buy or subscribe for securities or other financial instruments. All rights to the material are reserved and none of the material, nor its content, nor any copy of it, may be altered in any way, transmitted to, copied or distributed to any other party without prior express written permission of CBRE. Any unauthorised publication or redistribution of CBRE research reports is prohibited. CBRE will not be liable for any loss, damage, cost or expense incurred or arising by reason of any person using or relying on information in this publication.