NOVEMBER 2014 HCMC CENTRAL BUSINESS DISTRICT HO CHI MINH CITY. CBD MARKET Report.

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1 NOVEMBER 2014 HCMC CENTRAL BUSINESS DISTRICT HO CHI MINH CITY CBD MARKET Report

2 TABLE OF CONTENTS HCMC CBD MARKET REPORT NOVEMBER 2014 Market Highlights Page OFFICE MARKET Market Overview Market Performance Outlook Table RETAIL MARKET Market Overview Market Performance Outlook Table HOTEL MARKET Market Overview Market Performance Outlook Table SERVICED APARTMENT Market Performance Outlook Table CONTACTS

3 As you focus on your customer, we focus on you. You re an expert in knowing what your customers want often before they do. We bring the same approach to your business. Colliers International is built on an enterprising culture of collaboration and innovation. We provide creative, strategic solutions to all our clients. Whether you need sales and leasing brokerage, property marketing, research and demographics, or asset and property management, we have retail professionals across Vietnam who can meet the real estate needs of retail tenants, landlords and developers. Today s real estate challenges require more than geographic reach and local knowledge: they require integrated expertise in market segmentation, valuation, disposition, assembly, debt and equity strategies and much more. Our integrated platform and our experienced bring you closer to your customers.

4 NOVEMBER 2014 COMMERCIAL OFFICE MARKET Market Performance The 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 NORTHERN CBD average asking rent. Moreover, the market recorded a closer approach from effective rent to asking rent thanks CITY CENTRAL 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. Grade AAR Occupancy rate Supply A B B B SOUTHERN CBD FINANCIAL HUB B Outlook 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 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. HCMC FDI GROWTH, OCTOBER 2014 CBD OFFICE PERFORMANCE BY ZONE, OCTOBER 2014 P.2 Colliers International

5 OCTOBER 2014 COMMERCIAL OFFICE MARKET Office Market Overview No Name Address Completion Year NLA (sq m) Service Charges (*) Occupancy rate NFA 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 , % 50.0 Grade A 158, % OSIC 8 Nguyen Hue , % Yoco Building 41 Nguyen Thi Minh Khai , % Somerset Chancellor Court Nguyen Thi Minh Khai , % Central Plaza 17 Le Duan , % Saigon Riverside Office 2A-4A Ton Duc Thang , % Saigon Trade Center 37 Ton Duc Thang , % Harbour View Tower 35 Nguyen Hue , % MeLinh Point Tower 02 Ngo Duc Ke , % Zen Plaza Nguyen Trai , % Bitexco Office Building Nguyen Hue , % The Landmark 5B Ton Duc Thang , % Opera View Dong Khoi , % Petro Tower 1-5 Le Duan , % City Light 45 Vo Thi Sau , % The Landcaster 22Bis Le Thanh Ton , % Gemadept Tower 5 Le Thanh Ton , % Fideco Tower Ham Nghi , % Havana Tower 132 Ham Nghi , % Sailing Tower 51 Nguyen Thi Minh Khai , % Royal Center 235 Nguyen Van Cu , % TMS 172 Hai Ba Trung , % Bao Viet Tower 233 Dong Khoi , % Green Power Tower 35 Ton Duc Thang , % Vincom Center Le Thanh Ton , % Saigon Royal 91 Pasteur , % A&B Tower 76 Le Lai , % Maritime Bank Tower 192 Nguyen Cong Tru % Empress Tower 138 Hai Ba Trung , % Lim Tower 9-11 Ton Duc Thang , % Sunny MB Tower 259 Tran Hung Dao , % 25.0 Grade B 399, % 23.7 * US$/ sq m/ month (on net area) P.3 Colliers International

6 NOVEMBER 2014 CBD OFFICE MAP * US$/ sq m/ month (on net area) P.4 Colliers International

7 NOVEMBER 2014 RETAIL MARKET Market Performance According to the municipal Statistics Office, HCMC s Consumer Price Index (CPI) in October dropped 0.36% from October, CPI AND RETAIL-SERVICE REVENUE GROWTH, NOVEMBER 14 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 Source: GSO, Colliers International Outlook 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 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. Source: GSO, Colliers International RETAIL PODIUM MARKET PERFORMANCE, NOV 2014 SHOPPING CENTER MARKET PERFORMANCE, OCT 2014 P.5 Colliers International

8 NOVEMBER 2014 CBD RETAIL MAP * US$/ sq m/ month (on net area) P.6 Colliers International

9 KUMHO NOVEMBER MONTHLY 2014 MARKET RETAIL REPORT MARKET HCMC CBD MARKET REPORT No Name of Project / Building Address Location Completion Year NLA (sq m) Average Rental (US$/sq m/month) Occupancy Rate 1 Hotel Continental Saigon Dong Khoi District % 2 Caravelle Hotel 19 Lam Son Square District % 3 New World Hotel 79 Le Lai District , % 4 Sheraton Saigon 88 Dong Khoi District % 5 Opera View Lam Son Square District , % 6 Kumho Asiana Plaza 35 Le Duan District , % 7 Rex Arcade 141 Nguyen Hue District , % 8 ICON Ngo Duc Ke District , % 9 President Place 93 Nguyen Du District % 10 Times Square Nguyen Hue District , % Retail Podium 29, % 1 Diamond Plaza 34 Le Duan District , % 2 Zen Plaza Nguyen Trai District , % 3 Parkson Saigon Tourist 35 Le Thanh Ton District , % Department Store 30, % 1 Saigon Center 65 Le Loi District , % 2 City Plaza 230 Nguyen Trai District , % 3 Tax Center 135 Nguyen Hue District , % 4 Saigon Square Nam Ky Khoi Nghia District , % 5 Nowzone Nguyen Van Cu District , % 6 Saigon Square Ton Duc Thang District , % 7 Vincom Center B 72 Le Thanh Ton District , % 8 Taka Plaza 102 Nam Ky Khoi Nghia District , % 9 Union Square Dong Khoi District , % Shopping Centre 113, % NOVEMBER 2014 HOTEL MARKET HCMC CBD MARKET REPORT No Name of Hotel Address Location Completion Year Total Room Occupancy ARR(*) 1 Caravelle 19 Lam Son Square District % New World Saigon 76 Le Lai District % Sofitel Plaza Saigon 17 Le Duan District % Rex 141 Nguyen Hue District % Renaissance Riverside 8-15 Ton Duc Thang District % Lotte Legend Hotel 2A-4A 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 % Pullman Hotel 146 Tran Hung Dao District % Star 3,633 62% Continental Saigon Dong Khoi District % Norfolk Hotel Le Thanh Ton District % 92 3 Duxton 63 Nguyen Hue District % 75 4 Royal City 133 Nguyen Hue District % 59 5 Palace Saigon Nguyen Hue District % 55 6 Oscar 68A Nguyen Hue District % 40 7 Liberty Central 179 Le Thanh Ton District % 90 8 Grand 08 Dong Khoi District % 77 9 Liberty Central Riverside 17 Ton Duc Thang District % 88 4 Star 1,161 67% 74.7 P.7 Colliers International

10 NOVEMBER 2014 CBD HOTEL MAP * US$/ sq m/ month (on net area) P.8 Colliers International

11 NOVEMBER 2014 HOTEL MARKET Hotel Market Overview According to the Viet Nam National Administration of Tourism (VNAT), Vietnam welcomed more than 7.2 million foreign NUMBER OF INTERNATIONAL VISITORS TO HCMC, NOV 2014 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 Following to the HCMC government s figures, in the January- October period, the city saw 3.9 million international tourists, Source: Statistical Office in HCMC, Colliers International 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 PERFORMANCE OF TOP-GRADED HOTELS IN HCMC, NOV 2014 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 Source: Statistical Office in HCMC, Colliers International Outlook To maintain growth momentum, the city s tourism sector will organize many programs including a food festival towards the yearend, 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. P.9 Colliers International

12 NOVEMBER 2014 HOTEL MARKET PERFORMANCE OF 5-STARS HOTEL, NOVEMBER 2014 PERFORMANCE OF 4-STARS HOTEL, NOVEMBER 2014 NOVEMBER 2014 SERVICED APARTMENT MARKET Market Performance 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. Outlook 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 Therefore, the serviced market in CBD is forecasted to be in upward trend in next year. P.10 Colliers International

13 NOVEMBER 2014 SERVICED APARTMENT MARKET Serviced Apartment Overview GRADE A CBD SERVICED APARTMENTS PERFORMANCE GRADE B CBD SERVICED APARTMENTS PERFORMANCE NOVEMBER 2014 SERVICED APARTMENT HCMC CBD MARKET REPORT No Project Name Address Location Completion Year Total Room Average Occupancy ARR(*) 1 The Landmark 5B Ton Duc Thang District % 30 2 Somerset Chancellor Court Nguyen Thi Minh Khai District % 34 3 Sedona Suites 65 Le Loi District % 30 4 Nguyen Du Park Villas 111 Nguyen Du District % 30 5 The Landcaster 22 Bis Le Thanh Ton District % 37 6 InterContinental Asiana Saigon 39 Le Duan District % 36 Grade A % Somerset HCM 8A Nguyen Binh Khiem District % 26 2 Saigon Sky Garden 20 Le Thanh Ton District % 26 3 Norfolk Mansion Ly Tu Trong District % 33 4 Diamond Plaza 34 Le Duan District % 29 5 Garden View Court 101 Nguyen Du District % 31 6 Ben Thanh Luxury Ky Con District % Vincom Center 72 Le Thanh Ton District % 26 8 Lafayette De Saigon 08 Phung Khac Khoan District % 29 9 Spring Court 1Bis Phung Khac Khoan District % Nikko Saigon 235 Nguyen Van Cu District % Saigon City Residence 8A/3D2 Thai Van Lung District % 34 * US$/sq m/month ** Not including VAT Grade B % 27.1 *** Buildings are sorted by Year of Completion P.11 Colliers International

14 NOVEMBER 2014 CBD SERVICED APARTMENT MAP P.12 Colliers International

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