DECEMBER 2015 HCMC CENTRAL BUSINESS DISTRICT CBD MONTHLY MARKET REPORT

Transcription

1 DECEMBER 2015 HCMC CENTRAL BUSINESS DISTRICT CBD MONTHLY MARKET REPORT Accelerating success

2 Table of Contents HCMC MARKET OVERVIEW Page Office Retail Hotel Serviced Apartment LIST OF FIGURES Figure 1 Figure 2 Figure 3 Figure 4 Figure 5 Figure 6 Figure 7 Figure 8 Figure 9 Figure 10 Figure 11 Office, Average asking rent and net absorption rate... Office, Average occupacy rate by grade... Retail, Performance in December Retail, Average rental rate by grade... Retail, Supply by type... Hotel, Average room rate... Hotel, Occupancy rate... Hotel, Supply by district... Serviced apartment, Performance by type... Serviced apartment, Supply by type... Ho Chi Minh City FDI by year LIST OF TABLES Table 1 Table 2 Table 3 Table 4 Table 5 Office, CBD future supply... Significant office projects... Significant retail projects... Significant hotel projects... Significant serviced apartment projects COVER PAGE: SAIGON RIVER, HO CHI MINH CITY

3 DECEMBER 2015 OFFICE PERFORMANCE There has been a high level of tenant activity within the CBD with average occupancy rates reaching 93% across grade A, B & C properties. However, approximately 3,500sqm NFA of office space in Diamond Plaza will be available in January 2016, which will have an adverse effect on the Grade A occupancy rate. Average net asking rents continue to move upwards with Grade B & C properties showing climbing rents. Well-located, affordable Grade B office stock is performing strongly with an average net asking rent of USD23.9/sqm/month. The premium Grade A market is also recording an increase from USD35.1/sqm/month to USD36.1/sqm/month. This resulted in 2.8 ppts growth m-o-m in premium grade A net asking rents. Figure 1: Office, Average asking rent and net absorption rate USD/sqm/month Net absorption Asking rent Jan-15 Feb-15 Mar-15 Apr-15 May-15 Jun-15 Jul-15 Aug-15 Sep-15 Oct-15 Nov-15 Dec-15 Jan-16F Feb-16F Mar-16F sqm SUPPLY No new supply was added to the CBD stock in December Figure 2: Office, Average occupancy rate by grade Approximately 8,822sqm NLA from The Waterfront Saigon will come online in mid 2016, increasing Grade B total stock to 414,673sqm NLA. Grade A stock remains stable until 2017 when Saigon Centre (phase 2) and Deutsches Haus are due for completion providing an additional 65,859 sqm NLA. From 2019, there will be another two Grade A office buildings which are Nexus developed by Viet Capital and Refico Group and the One by Bitexco Group. % Grade A Grade B DEMAND The growth in demand for office space is expected to remain strong in 2016 on the back of improved macro-economic conditions. Ho Chi Minh City has seen robust growth in FDI with USD4.6 billion in 2015, up 47% y-o-y. The figure brings the total FDI inflow to the city to over US$40.5 billion with 5,765 valid projects. Finance, banking and insurance services continue to be the CBD office s growth engine. 60 Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec Jan. F Feb. F Mar. F Table 1: Office, CBD future supply OUTLOOK With the limited availability of premium office stock, landlords are gaining confidence in market fundamentals and have shown a desire to adjust rents and push back incentives. Rents across all grade are forecasted to grow approximately 4% in 2016 and 9% in Decentralised districts with well-established infrastructure and traffic system such as District 7 and Thu Thiem new urban area will become alternative options for tenants looking for large contiguous floor plates. Building name Grade Expected NLA Hai Quan Tower B 30, The Waterfront Saigon B 8, Saigion Center Phase 2 A 35, Deutsches Haus A 30, Expected completion Page 3

4 DECEMBER 2015 OFFICE Table 2: Significant Office Projects No Name Address Completion Year NLA (sqm) Service Charges (*) Occupancy rate Average asking rent (**) 1 Saigon Centre 65 Le Loi , % Saigon Tower 29 Le Duan , % Sunwah Tower 115 Nguyen Hue , % The Metropolitan 235 Dong Khoi , % Diamond Plaza 34 Le Duan , % Kumho Asiana Plaza 39 Le Duan , % Bitexco Financial Tower 45 Ngo Duc Ke , % President Place 93 Nguyen Du , % Times Square Nguyen Hue , % Le Meridien 3C Ton Duc Thang , % Vietcombank Tower 5 Me Linh Square , % 35.0 Grade A 212, % VTP-OSIC 8 Nguyen Hue , % Yo Co Building 41 Nguyen Thi Minh Khai , % Somerset Chancellor Court NguyenThi Minh Khai , % Central Plaza 17 Le Duan , % Harbour View Tower 35 Nguyen Hue , % Saigon Riverside Office 2A-4A Ton Duc Thang , % Saigon Trade Center 37 Ton Duc Thang , % MeLinh Point Tower 2 Ngo Duc Ke , % Zen Plaza Nguyen Trai , % Bitexco Building Nguyen Hue , % The Landmark 5B Ton Duc Thang , % Opera View Dong Khoi , % City Light 45 Vo Thi Sau , % Petro Tower 1-5 Le Duan , % The Lancaster Bis Le Thanh Ton , % CJ Building 5 Le Thanh Ton , % Continential Tower Ham Nghi , % Havana Tower 132 Ham Nghi , % Royal Center 235 Nguyen Van Cu , % Sailing Tower 51 Nguyen Thi Minh Khai , % TMS 172 Hai Ba Trung , % A&B Tower 76 Le Lai , % Bao Viet Tower 233 Dong Khoi , % Green Power Tower 35 Ton Duc Thang , % Maritime Bank Tower 192 Nguyen Cong Tru , % Saigon Royal 91 Pasteur , % Vincom Center Le Thanh Ton , % Empress Tower 138 Hai Ba Trung , % Lim Tower 9-11 Ton Duc Thang , % MB Sunny Tower 259 Tran Hung Dao, Co Giang , % Lim Tower 2 Vo Van Tan , % 24.0 Grade B 405, % 23.9 (*) US$/sqm/month (NLA) Page 4

5 SAIGON SKYLINE REVIEW CBD HCMC GRADE A OFFICE BUILDINGS KUMHO ASIANA PLAZA 39 Le Duan, District 1 26,000/1,402 $ $ 8.00 DIAMOND PLAZA SAIGON 34 Le Duan, District 1 15,936/2,200 $ $ 8.00 LE MERIDIEN 3C Ton Duc Thang, District 1 9,125/NA $ $ 6.00 SAIGON TOWER 29 Le Duan, District 1 13,950/NA $ $ 6.00 DEUTSCHES HAUS 3-5 Le Van Huu, District 1 THE METROPOLITAN 235 Dong Khoi, District 1 15,200/1,000 $ $ 6.00 PRESIDENT PLACE 93 Nguyen Du, District 1 8,330/1,000 $ $ 6.00 BITEXCO FINANCIAL TOWER 45 Ngo Duc Ke, District 1 37,710/900-1,300 $ $ 8.00 VIETCOMBANK TOWER 5 Me Linh Square, District 1 41,250/NA $ $ 7.00 TIMES SQUARE SAIGON Nguyen Hue, District 1 12,704/1,450 $ $ 7.00 SAIGON CENTRE 65 Le Loi, District 1 11,650/ 1,073 $ $ 6.50 SUNWAH TOWER 115 Nguyen Hue, District 1 20,800/ 1,166 $ $ 8.00 Page 5

6 DECEMBER 2015 RETAIL PERFORMANCE As of December 2015, average net asking rent across all segments remains stable at USD89/sqm/month. Amongst the three retail formats, department stores have the highest average net asking rents at USD129/sqm/month, this followed by shopping centers of USD90/sqm/month and retail podiums of USD74/sqm/month. Most of retail developments in the city centre have been fully occupied thanks to their sought-after location. The average occupancy across all grades reaches approximately 95%. Despite having the most expensive asking rents, department stores still achieve the highest occupancy rate of 99.4%. Figure 3: Retail, Performance in December 2015 % Occupancy rate Average asking rent Retail Podium Shopping Centre Department Store USD/sqm/month SUPPLY The CBD stock remains unchanged with 21 existing retail centres, providing a combined lettable area of 163,357sqm. Figure 4: Retail, Average rental rate by grade When Saigon Center Phase 2 is due for completion, approximately 50,000sqm GFA of prime retail area will be added to the supply pipeline. The mall is expected to open in the second half of 2016, with anchor tenant Takashimaya taking up about 15,000 sm of retail space Retail Podium Shopping Centre Department Store DEMAND The year 2015 is regarded as a busy year for retailers as Vietnam is a key market within the ASEAN Economic Community (AEC) and has participated in the Trans-Pacific Partnership (TPP). Total retail sales are estimated nearly USD110 billion, representing a 10.6% increase y-o-y. As international and local retailers are planning to gain bigger share in the retail market share, demand for retail space will keep growing. USD/sq m/month Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec. Jan. F Feb. FMar. F OUTLOOK Due to limited land availability in the city center, new large shopping malls will be built in suburban area. Supply is anticipated to grow stronger in the long term. By 2020, retail space in HCMC will be double from what exists today. Figure 5: Retail, Supply by type Shopping Center Retail Podium Department Store 7% The potential benefits of free trade agreements will bring more international retailers to Vietnam. With the influx of international players, the scarcity of new quality supply in the city center will remain in the medium to long term. As a result, the rental price is expected to increase around 15% in the next 4 years. 24% 69% Source: Colliers International Vietnam Page 6

7 DECEMBER 2015 RETAIL Table 3: Significant Retail Projects No Name of Project / Building Address Location Completion Year NLA (sq m) ARR (*) Occupancy Rate 1 Saigon Center Le Loi District Renovation Renovation Renovation 2 Times Square Nguyen Hue District , % 3 Caravelle Hotel 19 Lam Son Square District % 4 Continental Saigon Dong Khoi District % 5 New World Hotel 76 Le Lai Street District , % 6 Zen Plaza Nguyen Trai District , % 7 Sheraton Saigon 88 Dong Khoi District % 8 Opera View Lam Son Square District , % 9 Kumho Asiana 35 Le Duan District , % 10 Rex Arcade 141 Nguyen Hue District , % 11 ICON Ngo Duc Ke District , % 12 President Place 93 Nguyen Du District % Retail Podium 36, % 1 City Plaza 230 Nguyen Trai District , % 2 Parkson Saigontourist 35 Le Thanh Ton Street District , % 3 Nowzone Nguyen Van Cu Street District , % 4 Vincom Center B 72 Le Thanh Ton District , % 5 Union Square 171 Dong Khoi District , % 6 Diamond Plaza 34 Le Duan District , % Shopping Centre 123, % 1 Saigon Square Nam Ky Khoi Nghia District , % 2 Taka Plaza 102 Nam Ky Khoi Nghia District , % 3 Lucky Plaza 38 Nguyen Hue District , % Department Store 3, % (*) ARR (Average Rental Rate): All rents are stated in net rents per sqm, inclusive service charge but exculding VAT Page 7

8 DECEMBER 2015 HOTEL PERFORMANCE The high tourist season lifted the average room rate to USD177/ room/night, up 2.3ppts m-o-m. Five-star hotels recorded a growth rate of 2.6ppts m-o-m to USD232/room/night while the four-star segment moderately increased 1.6ppts to USD122/room/night. Average occupancy rate continued the upward trend, improving to 91%. Both five-star and four-star hotels experienced 1% m-o-m increase in occupied rooms, reaching 93% and 89% respectively. SUPPLY The year 2015 witnessed the openings of Reverie Times Square, Le Meridien and Des Arts Saigon, resulting in a growth of 20% in the five-star market share. The CBD is perceived as the most favourable location for upscale and luxury hotels. The existing stock remained stable in the review month with 14 five star-hotels and 13 four-star hotels, providing a total of approximately 6,300 rooms. Figure 6: Hotel, Average room rate star 5 star Mar.F Feb.F Jan.F Dec Nov Oct Sep Aug Jul Jun May Apr Mar Feb Jan Figure 7: Hotel, Average occupancy rate 5 star 4 star 100 USD/room/night DEMAND Ho Chi Minh City is considered as the leading tourism center in Vietnam. International arrivals to Ho Chi Minh City in 2015 are estimated 4.7 million, up 7% y-o-y and reaching 100% the year target. Revenue from the tourism industry is approximately USD 4,1 million, up 10% compared to Popular tourists come from China, South Korea, Japan and USA. % Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec Jan. F Feb. F Mar. F OUTLOOK The hotel market is forecasted to experience soft performance next month after the festive season. However, the market will peak up in February when Vietnamese overseas will come back to their home country for Lunar New Year. The supply pipeline will be ample in the next four years when Union Square, Ritz-Carlton Saigon, Lavenue Crown and Satra Tax Center projects join the market, providing more than 1,000 hotel rooms. Figure 8: Hotel, Supply by district Phu Nhuan Dist., 8% Dist. 5, 9% Dist. 3 5% 5% 2% Tan Di Binh st. Dist. 7 Dist. 1, 71% District 1 District 5 Phu Nhuan District District 3 Tan Binh District District 7 Page 8

9 DECEMBER 2015 HOTEL Table 4: Significant Hotel Projects No Name of Project Address Location Launched Year Room Occupancy Rate ARR (*) 1 Caravelle 19 Lam Son Square District % New World Saigon 76 Le Lai District % Rex 141 Nguyen Hue District % Sofitel Plaza Saigon 17 Le Duan District % Lotte Legend Hotel Saigon 2A - 4A Ton Duc Thang District % Renaissance Riverside 8-15 Ton Duc Thang District % Sheraton 88 Dong Khoi District % Park Hyatt Saigon 02 Lam Son Square District % Majestic Saigon 1 Dong Khoi District % InterContinental Asiana 39 Le Duan District % Nikko Saigon 235 Nguyen Van Cu District % Le Meridien 3C Ton Duc Thang District % Pullman Saigon Centre 146 Tran Hung Dao District % The Reverie Times Square Nguyen Hue District % Hotel Des Arts Saigon Nguyen Thi Minh Khai District % star Hotels 4,736 93% Continental Dong Khoi District % Norfolk Hotel Le Thanh Ton District % Duxton 63 Nguyen Hue District % Oscar 68A Nguyen Hue District % 59 5 Palace Saigon Nguyen Hue District % Royal City 133 Nguyen Hue District % 86 7 Paragon Saigon Hotel Thi Sach District % Liberty Central 179 Le Thanh Ton District % Golden Central Saigon 140 Ly Tu Trong District % Grand Silverland Hotel & Spa Ly Tu Trong District % Liberty Central Saigon Riverside 17 Ton Duc Thang District % Liberty Saigon City Point Hotel Pasteur District % Eden Saigon Hotel 38 Bui Thi Xuan District % star Hotels 1,751 89% 122 *Price excludes VAT Page 9

10 DECEMBER 2015 SERVICED APARTMENT PERFORMANCE Serviced apartments in the CBD continued to have the best performance with average occupancy at 89%. Grade A and Grade B occupancy was unchanged at 93% and 85% respectively. The average gross asking rents were stable at US$29/ sqm/ mth. The average rental rate was US$3,052/ unit/mth for a typical 2-bedroom unit in a popular area with sizes ranging from 80 sqm to 140 sqm. SUPPLY With highest density of international companies, embassies, commercial and entertainment centres as well as a wide range of public facilities, the CBD takes the greatest market share at 43%. Its total stock comprises of 1,586 units from 7 Grade A and 11 Grade B projects. During 2015, Grade A stock increased 10% with the completion of Reverie Residence with 89 units. The market share of Grade A and Grade B is 49% and 51% respectively. Figure 9: Serviced apartment, Performance by type US$/sqm/month Occupancy Average rental rate Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec Jan. F Feb. F Mar. F 2015 Figure 10: Serviced apartment, Supply by type 15% % Grade A DEMAND According to the Statistical Office of Ho Chi Minh City, in 2015, there were 555 newly registered FDI projects, reaching USD2,810.3 million. The FDI inflows trigger higher demand for accommodation from expatriates. Despite having the highest rents compared to other parts of the city, the CBD is still preferred by expatriates due to prime locations, well-established infrastructure and best services from well-known international operators. 63% Grade C Grade B 22% Grade A Grade B Grade C OUTLOOK In the next three years, the market will have 12 projects providing 2,200 units. The second half of 2016 will welcome 222 serviced apartments from Ascot Waterfront Saigon developed by Canh Hung Hai Thanh Corporation, an affiliate company under the management of M.I.K Corporation. Due to limited new supply in the city core in the short term, rents and occupancy rates of existing projects will experience positive correction.. Figure 11: Ho Chi Minh City FDI by year million USD/no.of projects Capital No. of projects Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q Source: HCMC GSO I Colliers International Research Page 10

11 DECEMBER 2015 SERVICED APARTMENT Table 5: Significant Serviced Apartment Projects No. Project Name Address Location Completion Year Total Room Average Occupancy ARR(*) (**) 1 The Landmark 5B Ton Duc Thang District % 26 2 Sedona Suites 65 Le Loi District % 30 3 Somerset Chancellor Court Nguyen Thi Minh Khai District % 34 4 Nguyen Du Park Villas 111 Nguyen Du District % 30 5 The Lancaster Bis Le Thanh Ton District % 37 6 Intercontinental Asian Saigon 39 Le Duan District % 36 Grade A % Norfork Mansion Ly Tu Trong District % 26 2 Saigon Sky Garden 20 Le Thanh Ton District % 26 3 Somerset HCM 8A Nguyen Binh Khiem District % 26 4 Diamond Plaza 34 Le Duan District % 29 5 Garden View Court 101 Nguyen Du District % 31 6 Ben Thanh Luxury Ky Con District % 18 7 Lafayette De SaiGon 8 Phung Khac Khoan District % 28 8 Vincom Center 45A Ly Tu Trong District % 26 9 Nikko Saigon 235 Nguyen Van Cu District % Saigon City Residence 8A/3D2 Thai Van Lung District % Spring Court 1Bis Phung Khac Khoan District % 23 Grade B % 25.9 (*) US/sqm/month (**) ARR (Average Rental Rate): All rents are stated in gross rents per sqm, not including VAT and serviced charge Page 11

12 About Colliers International Colliers International is a leader in global real estate services, defined by our spirit of enterprise. Through a culture of service excellence and a shared sense of initiative, we integrate the resources of real estate specialists worldwide to accelerate the success of our partners. We connect through a shared set of values that shape a collaborative environment throughout our organization that is unsurpassed in the industry. 502 offices in 67 countries on 6 continents With more than 100 professionals in 2 offices in Vietnam, the team is market driven and has proven and successful track record with both international and local experience. From Hanoi to Ho Chi Minh City, we provide a full range of real estate services The foundation of our services is the strength and depth of our experience. $2.30 billion in annual revenue 1.7 billion square feet under management 16,300 professionals and staff COLLIERS INTERNATIONAL VIETNAM HO CHI MINH CITY Bitexco Office Building, 7th Floor Nguyen Hue Street District 1, HCM City, Vietnam Tel: HANOI Press Club Building, 4th Floor 59A Ly Thai To Street, Hoan Kiem District, Hanoi, Vietnam Tel: Publication Coverage Frequency Content Availability Knowledge Report/ Market Insights Vietnam Cities Quarterly All market sectors Publicly available Investment report Vietnam Quarterly Economic updates and Investment highlights Publicly available CBD Report HCMC CBD Monthly Office, Retail, Hotel and Publicly available Serviced Apartment Residential launch update HCMC Monthly Residential Publicly available Asia Pacific Office Report Vietnam Property Market Report Asia Pacific Quarterly Office market Publicly available including Vietnam Vietnam cities Quarterly All market sectors On subscription For further information, please contact us: DAVID JACKSON General Director david.jackson@colliers.com HA VO Senior Research Analyst ha.vo@colliers.com Development Vietnam cities At request All market sectors On subscription Recommendation This document has been prepared by Colliers International for advertising and general information only. Colliers International makes no guarantees, representations or warranties of any kind, expressed or implied, regarding the information including, but not limited to, warranties of content, accuracy and reliability. Any interested party should undertake their own inquiries as to the accuracy of the information. Colliers International excludes unequivocally all inferred or implied terms, conditions and warranties arising out of this document and excludes all liability for loss and damages arising there from. This publication is the copyrighted property of Colliers International and/or its licensor(s) All rights reserved.