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OPPORTUNITIES IN THE NEW NORMAL
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Asia Pacific
A S I A P A C I F I C
R E A L E S T A T E M A R K E T O U T L O O K
2 0 1 7 A S I A P A C I F I C
R E A L E S T A T E M A R K E T O U T L O O K
MACROECONOMICS
2 0 1 7 A S I A P A C I F I C
R E A L E S T A T E M A R K E T O U T L O O K
9
-6
-4
-2
0
2
4
6
8
2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020
%
Asia United States Western Europe
Source: Oxford Economics, January 2017.
G R O W T H H A S N E V E R B E E N S O S T A T I C R E A L G D P G R O W T H R A T E
Forecast
2 0 1 7 A S I A P A C I F I C
R E A L E S T A T E M A R K E T O U T L O O K
10
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0
1
2
3
4
5
6
7
Ja
n-9
7
Ja
n-9
8
Ja
n-9
9
Ja
n-0
0
Ja
n-0
1
Ja
n-0
2
Ja
n-0
3
Jan-0
4
Jan-0
5
Ja
n-0
6
Ja
n-0
7
Ja
n-0
8
Ja
n-0
9
Ja
n-1
0
Ja
n-1
1
Ja
n-1
2
Ja
n-1
3
Ja
n-1
4
Ja
n-1
5
Ja
n-1
6
Ja
n-1
7
Ja
n-1
8
% Fed Funds Target Rate - December estimation
September estimation
Long-term target (year-end)
I N T E R E ST R A T E H I K E E XP E C T A T I O N S R E V I S E D U P W A R D M E D I A N F E D R A T E E X P E C T A T I O N A M O N G F O M C P A R T I C I P A N T S
Source: Federal Reserve FOMC meeting , CBRE Research, December 2016.
2 0 1 7 A S I A P A C I F I C
R E A L E S T A T E M A R K E T O U T L O O K
11
B U T I N T E R E ST R A T E S I N A S I A P A C I F I C R E M A I N L O W P O L I C Y R AT E S I N K E Y M A R K E T S
6.5 6.5 6.3
4.4 3.0
1.8 1.5 1.5 1.4 1.3
-0.1
1.3 1.1
-2
0
2
4
6
8
10
12
14
16
Vie
tnam
Indo
ne
sia
India
Ch
ina
Ma
laysia
Ne
w Z
ea
land
Au
str
alia
Tha
iland
Taiw
an
So
uth
Ko
rea
Ja
pa
n
Sin
ga
po
re
Ho
ng
Ko
ng
%
Source: Various Central Banks, Monetary Authorities,
CBRE Research, December 2016.
Note on policy rates: Australia – Cash rate; China – 1-yr lending
rate; Taiwan – Discount rate; India – Repo rate; Indonesia – BI
rate; South Korea – Base rate; Thailand – 1-day repo rate; New
Zealand – Official cash rate; Japan – Overnight call rate; Hong
Kong – 3M HIBOR; Singapore – 3M SIBOR; Vietnam –
Refinancing rate; Malaysia – Overnight rate
Ten Year High
2017F
Ten Year Low
Possible rate
hike
2 0 1 7 A S I A P A C I F I C
R E A L E S T A T E M A R K E T O U T L O O K
OFFICE
2 0 1 7 A S I A P A C I F I C
R E A L E S T A T E M A R K E T O U T L O O K
13
UP FLAT DOWN
2017 LEASING MARKETS MOMENTUM
0
10
20
30
40
50
602001
2002
2003
2004
2005
2006
2007
2008
2009
2010
2011
2012
2013
2014
2015
2016F
2017F
Ne
t a
bso
rptio
n -
mill
ion s
q. ft
. (N
FA
)
Q1 Q2 Q3 Q4 Annual New Supply
-5% to -
10%
Source: CBRE Research, January 2017.
O F F I C E L E A S I N G V O L U M E W I L L M O D E R A T E I N 2 0 1 7 I N D I A R E M A I N S H E A L T H Y B U T C H I N A S E T T O W E A K E N
Cynthia to
update
2017 NET ABSORPTION
OUTLOOK
2017 NET ABSORPTION
OUTLOOK
DOWN
FLAT
2 0 1 7 A S I A P A C I F I C
R E A L E S T A T E M A R K E T O U T L O O K
14
S U P P L Y R E M A I N S A M A J O R C H A L L E N G E
0
5
10
15
20
25
30S
han
gh
ai
Ne
w D
elh
i
Sh
en
zhe
n
Gu
an
gzh
ou
Tokyo
Mu
mb
ai
Ja
kart
a
Be
ijin
g
Ho
ng
Ko
ng
Se
ou
l
Ma
nila
Ma
ka
ti
Sin
ga
po
re
Hanoi
Taip
ei
Ho
Cho
Min
h C
ity
Au
ckla
nd
Ba
ng
alo
re
Ba
ng
kok
Me
lbou
rne
Syd
ne
y
Pe
rth
Brisbane
mill
ion s
q. ft
. (N
FA
)
Net absorption (2017-2019 forecast) New supply (2017-2019 forecast)
Remarks: Net absorption and new supply figures covered the grade
A markets with the exception of the Australian markets which
covered the all-grades markets; net supply is used for the Pacific
markets; gross absorption is used for the Indian markets.
Source: CBRE Research, January 2017.
Demand > New Supply New Supply > Demand
2 0 1 7 A S I A P A C I F I C
R E A L E S T A T E M A R K E T O U T L O O K
15
Source: CBRE Research, January 2017.
Tenant - Driven Landlord – Driven
Shanghai
Shenzhen
Brisbane
Guangzhou
Ho Chi Minh City
Mumbai
Beijing
Hong Kong
New Delhi
Auckland
Bangkok
Taipei
Tokyo
Melbourne
Sydney
Bangalore
Hanoi
Perth
Seoul
Singapore
M O S T M A R K E T S W I L L F A V O U R T E N A N T S I N 2 0 1 7 O F F I C E R E N T A L C Y C L E – Q 4 2 0 1 6
2 0 1 7 A S I A P A C I F I C
R E A L E S T A T E M A R K E T O U T L O O K
16
-15
-10
-5
0
5
10
15
20
25
30S
yd
ne
y
Ba
ng
alo
re
Me
lbou
rne
Ba
ng
kok
Gu
an
gzh
ou
Gu
rga
on
Au
ckla
nd
Tokyo
Brisb
an
e
Mu
mb
ai
Ha
no
i
Ho
Chi M
inh C
ity
Taip
ei
De
lhi
Se
ou
l
Ho
ng
Ko
ng
Sh
an
gh
ai
Sh
en
zhe
n
Pe
rth
Be
ijin
g
Ja
kart
a
Sin
ga
po
re
Gra
de A
Eff
ecti
ve
Re
nta
l G
row
th (
%) 2016F 2017F
W E A K E R R E N T A L G R O W T H I S E XP E C T E D
Source: CBRE Research, January 2017.
Bottoming
Out
Peaking
2 0 1 7 A S I A P A C I F I C
R E A L E S T A T E M A R K E T O U T L O O K
RETAIL
2 0 1 7 A S I A P A C I F I C
R E A L E S T A T E M A R K E T O U T L O O K
18
Source: CBRE Research, January 2017.
S T R O N G F O C U S O N P O R T F O L I O O P T I M I S AT I O N
TRADITIONAL REFINED STRATEGY
FLAGSHIP STORE + SATELLITE STORES
Flagship store to focus on
in-store experience
and brand promotion
Satellite stores to
focus on efficiency
2 0 1 7 A S I A P A C I F I C
R E A L E S T A T E M A R K E T O U T L O O K
19
Source: CBRE Research, December 2016.
N E W S U P P L Y P I P E L I N E T O F A L L F R O M 2 0 1 6 ’ S P E A K P R E - L E A S I N G A C T I V I T Y R E M A I N S S L O W
Pre-leasing now starts at least
19 MONTHS ahead of project completion
50% of new
malls delayed their completion date by more than six
months due to pre-leasing issues
0
10
20
30
40
50
60
70
2014 2015 2016F 2017F
Re
tail
De
ve
lop
me
nt
Pip
eli
ne
(mil
lio
n s
q. ft
.)
China Tier 1 Cities Rest of Asia Pacific
2 0 1 7 A S I A P A C I F I C
R E A L E S T A T E M A R K E T O U T L O O K
20
Note: *Prime rent is used in Tokyo, rents of Shopping centres are used in China and Singapore
Source: CBRE Research, January 2017.
-15
-10
-5
0
5
10
15
20
Au
ckla
nd
Syd
ne
y
Me
lbou
rne
Gu
an
gzh
ou
Be
ijin
g
Taip
ei
Sh
an
gh
ai
Brisb
an
e
Ho
Chi M
inh C
ity
Ha
no
i
Sh
en
zhe
n
Tokyo
Ho
ng
Ko
ng
Sin
ga
po
re
Re
tail
re
nta
l g
row
th (
%)
2016F 2017F
T H E P A C E O F R E N T A L G R O W T H W I L L B E M U T E D
Vietnam’s forecast is on the
absolute rental level so the city’s
average rent will be dragged
down by the new completions in
non-CBD areas.
If we stripped them out, the
rental movement is around +2%
on a “like-to-like” basis.
Close to
bottom Peaking
2 0 1 7 A S I A P A C I F I C
R E A L E S T A T E M A R K E T O U T L O O K
LOGISTICS
2 0 1 7 A S I A P A C I F I C
R E A L E S T A T E M A R K E T O U T L O O K
22
F O C U S O N P O R T F O L I O O P T I M I Z AT I O N
INDUSTRIAL ROBOTS PER 10,000 PERSONS EMPLOYED IN
MANUFACTURING
Update to 2016 year-end figures (2015 is the
latest data available
Add China, India, any countries in SE Asia? China
added
Line for global average? DONE (for 2015)
Historical time series? DONE (in aggregate)
What is the definition of industrial robots
Industrial Robot Definition:
Industrial robot as defined by ISO 8373: An automatically controlled, reprogrammable, multipurpose manipulator programmable in three or more axes, which may be either fixed in place or mobile for use in industrial automation applications.
0
50
100
150
200
250
300
2003
2004
2005
2006
2007
2008
2009
2010
2011
2012
2013
2014
2015
ESTIMATED ANNUAL SUPPLY OF INDUSTRIAL ROBOTS
(THOUSANDS)
Source: World Robotics, 2016.
Note: Industrial robot as defined by ISO 8373
A U T O M AT I O N S E T T O C H A N G E T H E L O G I S T I C S L A N D S C A P E P O R T F O L I O O P T I M I S A T I O N K E Y A S P R O D U C T I O N C Y C L E S T I G H T E N
Source: International Federation of Robots, September 2016.
High
Low
Le
ve
l o
f a
uto
matio
n
0
100
200
300
400
500
600S
outh
Ko
rea
Sin
ga
po
re
Ja
pa
n
Ge
rma
ny
Sw
ede
n
Taiw
an
De
nm
ark
Un
ite
d S
tate
s
Be
lgiu
m
Ita
ly
Ch
ina
2 0 1 7 A S I A P A C I F I C
R E A L E S T A T E M A R K E T O U T L O O K
23
0
5
10
15
20
25
30
35
Gre
ate
r S
eou
l
Gre
ate
r T
okyo
Gre
ate
r O
sa
ka
Sh
an
gh
ai
Syd
ne
y
Sin
gapore
Me
lbou
rne
Brisb
an
e
Au
ckla
nd
Be
ijin
g
Pe
rth
Sh
en
zhe
n
Gu
an
gzh
ou
Hong K
ong
Lo
gis
tic
s D
eve
lop
me
nt
Pip
eli
ne (
Mil
lio
n
sq
. ft
.)
2017F 2018FSource: CBRE Research, December 2016.
Definition of new supply for Korea? Grade A
Logistics
Remove annual historical average? Removed
Geographical coverage? Citywide
S U P P L Y L E V E L S T O B E C O M E M O R E B A L A N C E D
Oversupply Risk Undersupply Risk
2 0 1 7 A S I A P A C I F I C
R E A L E S T A T E M A R K E T O U T L O O K
24
-9%
-6%
-3%
0%
3%
6%
9%
12%
Sh
en
zhe
n
Sh
an
gh
ai
Gu
an
gzh
ou
Auckla
nd
Syd
ne
y
Brisb
an
e
Be
ijin
g
Me
lbou
rne
To
kyo
Ba
y A
rea
Sin
ga
po
re
Pe
rth
Gre
ate
r O
sa
ka
Ho
ng
Ko
ng
Lo
gis
tic
s r
en
tal g
row
th
2016F 2017F
C H I N A S T I L L L E A D S I N R E N T A L G R O W T H P R O S P E C T S A U S T R A L I A I S R E C O V E R I N G
Source: CBRE Research, December 2016.
Contraction Peaked
2 0 1 7 A S I A P A C I F I C
R E A L E S T A T E M A R K E T O U T L O O K
CAPITAL MARKETS
2 0 1 7 A S I A P A C I F I C
R E A L E S T A T E M A R K E T O U T L O O K
26
-4%
-2%
0%
2%
4%
6%
8%P
ert
h
Ha
no
i
Brisb
an
e
Tokyo
Au
ckla
nd
Ho
Chi M
inh C
ity
Ba
ng
kok
Me
lbou
rne
Se
ou
l
Syd
ne
y
Mu
mb
ai
Ku
ala
Lum
pur
Ta
ipe
i
Be
ijin
g
Sh
an
gh
ai
New
Delh
i
Gu
an
gzh
ou
Ba
ng
alo
re
Sin
ga
po
re
Sh
en
zhe
n
Ho
ng
Ko
ng
Off
ice Y
ield
Sp
read
Ten Year High
2017F
Ten Year Low
Yield spread narrowed to
100 bps or below
Source: CBRE Research, December 2016.
Y I E L D S P R E A D C O N T I N U E S A T L O W L E V E L S O F F I C E Y I E L D V S 1 0 - Y E A R G O V E R N M E N T B O N D Y I E L D
2 0 1 7 A S I A P A C I F I C
R E A L E S T A T E M A R K E T O U T L O O K
27
0
500
1,000
1,500
2,000
0
20
40
60
80
100
1202005
2006
2007
2008
2009
2010
2011
2012
2013
2014
2015
2016F
2017F
Nu
mb
er
of
tra
nsa
cti
on
s
US
$ b
illi
on
Q1 Q2 Q3 Q4 Forecast Number of transactions
UP FLAT DOWN
2017 INVESTMENT VOLUME
I N V E S T ME NT T U R N O V E R T O M O D E R A T E I N 2 0 1 7 T O TA L I N V E S T M E N T V O L U M E I N A S I A PA C I F I C
Remarks: Transactions include deals above US$10 million in the
Office, Retail, Mixed, Industrial, Hotel and other commercial sectors.
Residential and development site are excluded.
Source: CBRE Research, RCA, December 2016.
-5%
OCCUPIERS • Plan ahead
• Be flexible
• Focus on efficiency
INVESTORS • Focus on NOI growth
• Unlock hidden value
• Target niche sectors
INVESTMENT DESTINATION
CYCLICAL
• Australia office, still
• China logistics, if available
• Japan regional cities, if you can borrow
• Vietnam office, build-to-core
COUNTER-CYCLICAL
• Singapore office, if not too late
• Hong Kong retail, if you are patient enough
2 0 1 7 A S I A P A C I F I C
R E A L E S T A T E M A R K E T O U T L O O K
31
H A V E Y O U R S A Y I N O U R G L O B A L S U R V E Y
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Occupier
Survey
Investor
In tent ions
Survey
2 0 1 7 A S I A P A C I F I C
R E A L E S T A T E M A R K E T O U T L O O K
32
This presentation has been prepared in good faith based on CBRE’s current views of the commercial real-estate market.
Although CBRE believes its views reflect market conditions on the date of this presentation, they are subject to significant
uncertainties and contingencies, many of which are beyond CBRE’s control. In addition, many of CBRE’s views are
opinion and/or projections based on CBRE’s subjective analyses of current market circumstances. Other firms may have
different opinions, projections and analyses, and actual market conditions in the future may cause CBRE’s current views
to later be incorrect. CBRE has no obligation to update its views herein if its opinions, projections, analyses or market
circumstances later change.
Nothing in this presentation should be construed as an indicator of the future performance of CBRE’s securities or of the
performance of any other company’s securities. You should not purchase or sell securities – of CBRE or any other
company – based on the views herein. CBRE disclaims all liability for securities purchased or sold based on information
herein, and by viewing this presentation, you waive all claims against CBRE and the presenter as well as against CBRE’s
affiliates, officers, directors, employees, agents, advisers and representatives arising out of the accuracy, completeness,
adequacy or your use of the information herein.
D I S C L A I M E R S A N D W A I V E R S
Thank You
2 0 1 7 A S I A P A C I F I C
R E A L E S T A T E M A R K E T O U T L O O K
OPPORTUNITIES IN THE NEW NORMAL
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VIETNAM
A S I A P A C I F I C
R E A L E S T A T E M A R K E T O U T L O O K
2 0 1 7 A S I A P A C I F I C
R E A L E S T A T E M A R K E T O U T L O O K
35
2 0 1 7 A S I A P A C I F I C
R E A L E S T A T E M A R K E T O U T L O O K
2 0 1 7 A S I A P A C I F I C
R E A L E S T A T E M A R K E T O U T L O O K
36
2 0 1 7 A S I A P A C I F I C
R E A L E S T A T E M A R K E T O U T L O O K
1. VIETNAM ECONOMY
2 0 1 7 A S I A P A C I F I C
R E A L E S T A T E M A R K E T O U T L O O K
37
0
1
2
3
4
5
6
7
8
9
20
03
20
04
20
05
20
06
20
07
20
08
20
09
20
10
20
11
20
12
20
13
20
14
20
15
20
16
20
17
20
18
20
19
20
20
20
21
20
22
20
23
20
24
20
25
Re
al
GD
P G
row
th R
ate
(%
)
Source: GSO, Oxford Economics 2016.
2 0 1 6 G D P G R O W T H L O W E R T H A N E X P E C T E D
6.21%
Forecast
S T I L L AM O N G R E G I O N ’ S S T R O N G E S T
2 0 1 7 A S I A P A C I F I C
R E A L E S T A T E M A R K E T O U T L O O K
38
0
5
10
15
20
25
2007 2008 2009 2010 2011 2012 2013 2014 2015 2016
Inte
rest
ra
te (
%)
Average CPI (y-o-y) Lending rate Deposit rate
Average CPI: 2.7% y-o-y Basic Inflation: 1.83% y-o-y
Source: Macrobond, CBRE Research Q2 2016
INFLATION PICKS UP WHILE INTEREST RATES STAYED LOW
Source: GSO, CBRE Vietnam.
2 0 1 7 A S I A P A C I F I C
R E A L E S T A T E M A R K E T O U T L O O K
39
Source: HNC, Gold.org, SJC, SBV.
0
20
40
60
80
100
120
140
160
Jan
Feb
Mar
Ap
r
May
Jun
Jul
Au
g
Sep
Oct
No
v
Dec
Jan
Feb
Mar
Ap
r
May
Jun
Jul
Au
g
Sep
Oct
No
v
Dec
Jan
Feb
Mar
Ap
r
May
Jun
e
July
Au
g
Sep
Oct
No
v
Dec
2014 2015 2016
Ind
ex
Government Bond VN-Index Local Gold USD/VND Crude Oil
M A J O R A S S E T C L A S S E S
2 0 1 7 A S I A P A C I F I C
R E A L E S T A T E M A R K E T O U T L O O K
40
7,036
2,590
2,419
1,875
1,860
South Korea
Japan
Singapore
China
Taiwan
F D I R E A C H E D 8 - Y E A R H I G H Vietnam Registered FDI in 2016: US$24.4 billion
24
-
20
40
60
802
00
7
20
08
20
09
20
10
20
11
20
12
20
13
20
14
20
15
20
16
Reg
iste
red
FD
I (U
S$
Bil
lio
ns)
Real estate accounts for 7% of registered FDI, ranks 2nd among sectors
Top FDI Investors, US$ million, 2016
1 2 3
Major Real Estate Deals, 2016
US$315m Industrial Park - Quang Ninh
US$309m Township - Dong Nai
US$300m 21-storey building - Hanoi
Source: Vietnam Ministry of Planning and Investment.
2 0 1 7 A S I A P A C I F I C
R E A L E S T A T E M A R K E T O U T L O O K
41
Under construction
Under planning 2 3
1
4 5 6
INFRASTRUCTURE & PUBLIC TRANSPORTATION
D E M A N D F O R T R A N S I T O R I E N T E D D E V E L O P M E N T S
Retail
Office
Amenities
P Parking
A GROWING CONCERN AS THE FIRST METRO LINE IS CLOSE TO COMPLETION
2 0 1 7 A S I A P A C I F I C
R E A L E S T A T E M A R K E T O U T L O O K
42
INFRASTRUCTURE & PUBLIC TRANSPORTATION
Under Construction Metro Line
Under Planning Metro Line
D E M A N D F O R T R A N S I T O R I E N T E D D E V E L O P M E N T S
Retail
Office
Amenities
P Parking
2
3
A GROWING CONCERN AS THE FIRST METRO LINE IS CLOSE TO COMPLETION
THE EIGHT METRO LINES
OF HANOI
2 0 1 7 A S I A P A C I F I C
R E A L E S T A T E M A R K E T O U T L O O K
43
2 0 1 7 A S I A P A C I F I C
R E A L E S T A T E M A R K E T O U T L O O K
2. CONDOMINIUM
2 0 1 7 A S I A P A C I F I C
R E A L E S T A T E M A R K E T O U T L O O K
44
Source: CBRE Vietnam , Q4 2016
HANOI - NEW LAUNCH BY YEAR HCMC - NEW LAUNCH BY YEAR
N E W L A U N C H D E C R E A S E Y - O - Y B U T H I G H E R O N 1 0 - Y R A V E R A G E
37,419 units 10% y-o-y
HCMC - 2016 30,028 units 13% y-o-y
HANOI - 2016
0
10,000
20,000
30,000
40,000
50,000
2009 2010 2011 2012 2013 2014 2015 2016
No
. of
un
it
Luxury High-end Mid-end Affordable
0
10,000
20,000
30,000
40,000
50,000
2009 2010 2011 2012 2013 2014 2015 2016
No
. of
un
it
Luxury High-end Mid-end Affordable
2 0 1 7 A S I A P A C I F I C
R E A L E S T A T E M A R K E T O U T L O O K
45
36% 40%
Source: CBRE Vietnam , Q4 2016. Luxury: >US$3,500 per sm
High-end: US$1,500 to US$3,500 per sm Mid-end: US$800 to $1,500 per sm
Affordable: US$800 per sm
51%
42% 56%
0%
20%
40%
60%
80%
100%
2014 2015 2016
Luxury High-end Mid-end Affordable
0%
20%
40%
60%
80%
100%
2014 2015 2016
Luxury High-end Mid-end Affordable
36% 40% 47%
HANOI - NEW LAUNCH BREAKDOWN HCMC - NEW LAUNCH BREAKDOWN
M I D - E N D S E G M E N T E X P A N D I N G E AS I N G H I G H - E N D O V E R S U P P LY F E AR
2 0 1 7 A S I A P A C I F I C
R E A L E S T A T E M A R K E T O U T L O O K
46
H C M C : E A S T A N D S O U T H
North 7%
East 41%
West 11% Central
8%
South 34%
H A N O I : W E S T A N D S O U T H W E S T
West 37%
South West 24%
South 12%
East 10%
North 4%
Midtown 7%
CBD 1%
CBD fringe 6%
NEW LAUNCH REMAINS STRONG IN DECENTRALIZED DISTRICTS
Source: CBRE Vietnam , Q4 2016.
2 0 1 7 A S I A P A C I F I C
R E A L E S T A T E M A R K E T O U T L O O K
47
Source: CBRE Vietnam , Q4 2016
HANOI - NEW LAUNCH FORECAST HCMC - NEW LAUNCH FORECAST
0
10,000
20,000
30,000
40,000
50,000
20
09
20
10
20
11
20
12
20
13
20
14
20
15
20
16
20
17
F
20
18
F
20
19
F
New
lau
nch
su
pp
ly (
un
its)
Luxury High-end Mid-end Affordable
L O W E R S E G M E N T S I N T H E L I M E L I G H T F O R T H E N E XT 3 Y E A R S
-
10,000
20,000
30,000
40,000
50,000
20
09
20
10
20
11
20
12
20
13
20
14
20
15
20
16
20
17
F
20
18
F
20
19
F
New
lau
nch
su
pp
ly (
un
its)
Luxury High-end Mid-end Affordable
Forecast Forecast
2 0 1 7 A S I A P A C I F I C
R E A L E S T A T E M A R K E T O U T L O O K
48
NEW SALES 2016
21,188 units
2% y-o-y
HANOI
35,008 units
4% y-o-y
HCMC
S A L E S D E C R E A S E Y - O - Y B U T I S C AT C H I N G U P FAS T W I T H N E W L AU N C H
2016: 69% TOTAL SOLD UNITS (*) NEW LAUNCH
HANOI
2015: 64%
2016: 94% HCMC
2015: 88% (%)
(*) Total sold units include both units sold at newly-launched projects in the period and at previously-launched projects
Source: CBRE Vietnam , Q4 2016
2 0 1 7 A S I A P A C I F I C
R E A L E S T A T E M A R K E T O U T L O O K
49
Source: CBRE Vietnam , Q4 2016
HANOI – SOLD UNITS BY YEAR HCMC - SOLD UNITS BY YEAR
S A L E S M O M E N T U M R E M A I N S U P B E A T
0
5,000
10,000
15,000
20,000
25,000
30,000
35,000
40,000
45,000
2011 2012 2013 2014 2015 2016 2017F2018F2019F
No
. o
f so
ld u
nit
s
Luxury High-end Mid-end Affordable
Forecast
0
5,000
10,000
15,000
20,000
25,000
30,000
35,000
40,000
45,000
2011 2012 2013 2014 2015 2016 2017F 2018F 2019F
No
. o
f so
ld u
nit
s
Luxury High-end Mid-end Affordable
Forecast
2 0 1 7 A S I A P A C I F I C
R E A L E S T A T E M A R K E T O U T L O O K
50
~68.6% of new launches sold in 2016
No. of Project
Sales rate (%)
1
44%
9
50%
7
53%
14
62%
6
48%
3
72%
4
48%
4
69%
3
32%
9
57%
3
42%
5
53%
11
70%
3
65%
2
42%
9
73%
1
88%
H C M C : H I G H S A L E S R A T E S I N D I S T R I C T 2 , 9 A N D N H A B E Implication for districts only, not exact project location
2 0 1 7 A S I A P A C I F I C
R E A L E S T A T E M A R K E T O U T L O O K
51
Implication for districts only, not exact project location
No. of Projects Sales rate (%)
5 62%
2 82%
5 69%
2 62%
5 86%
3 76%
13 75%
13 65%
8 48%
7 53%
~64% of new launch in 2016 sold
H I G H S A L E S R A T E S I N B A D I N H , H A I B A T R U N G D I S T R I CT S
2 0 1 7 A S I A P A C I F I C
R E A L E S T A T E M A R K E T O U T L O O K
52
0%
50%
100%
150%
200%
2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017F 2018F 2019F
Per
cen
tag
e ch
ang
e (%
)
Luxury High-end Mid-end Affordable
0%
50%
100%
150%
200%
2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017F 2018F 2019FPer
cen
tag
e ch
ang
e (%
)
HANOI - PRIMARY PRICE FORECAST
HCMC - PRIMARY PRICE FORECAST
P R I M A R Y P R I C I N G U P A C R O S S S E G M E N T S
Source: CBRE Vietnam , Q4 2016. Note: (1) Base year is 2005 (2) No luxury projects in Hanoi until 2011.
Forecast
2 0 1 7 A S I A P A C I F I C
R E A L E S T A T E M A R K E T O U T L O O K
53
2 0 1 7 A S I A P A C I F I C
R E A L E S T A T E M A R K E T O U T L O O K
3. OFFICE
2 0 1 7 A S I A P A C I F I C
R E A L E S T A T E M A R K E T O U T L O O K
54
Hanoi
Rents
2.9% y-o-y 0.6%
y-o-y
3.3 ppts y-o-y
5.6 ppts y-o-y
Vacancy rate (%)
Grade A Grade B
HCMC
Rents
Vacancy rate (%)
Grade A Grade B
1.9% y-o-y
6.2% y-o-y
1.6 ppts y-o-y
V A C A N C Y T R E N D S D I F F E R
Rent: US$/sm/month, excludes VAT and Service charge Source: CBRE Vietnam, Q4 2016.
3.3 ppts y-o-y
US$36 US$21 US$28 US$18
8.0% 2.8% 15.8% 16.5%
2 0 1 7 A S I A P A C I F I C
R E A L E S T A T E M A R K E T O U T L O O K
55
+14% y-o-y
415,355 sm
+5% y-o-y
774,792 sm
Grade A: Grade B:
0
300,000
600,000
900,000
1,200,000
2009 2010 2011 2012 2013 2014 2015 2016
To
tal
Su
pp
ly (
NL
A, s
m)
Grade A Grade B
HANOI - TOTAL SUPPLY HCMC - TOTAL SUPPLY
+7.7% y-o-y
758,280 sm
+1.5% y-o-y
321,557 sm
Grade A: Grade B:
S U P P L Y G R O W T H F A S T E R I N H A N O I
Source: CBRE Vietnam , Q4 2016.
0
300,000
600,000
900,000
1,200,000
2009 2010 2011 2012 2013 2014 2015 2016
To
tal
Su
pp
ly (
NL
A, s
m)
Grade A Grade B
2 0 1 7 A S I A P A C I F I C
R E A L E S T A T E M A R K E T O U T L O O K
56
0
50,000
100,000
150,000
200,000
250,0002
00
9
20
10
20
11
20
12
20
13
20
14
20
15
20
16
20
17
F
20
18
F
20
19
F
New
Su
pp
ly (
NL
A, s
m)
Grade A Grade B
0
50,000
100,000
150,000
200,000
250,000
20
09
20
10
20
11
20
12
20
13
20
14
20
15
20
16
20
17
F
20
18
F
20
19
F
New
Su
pp
ly (
sm, N
LA
)
Grade A Grade B
HANOI – NEW SUPPLY FORECAST HCMC - NEW SUPPLY FORECAST
… B U T H C M C S T A R T E D T O C A T C H U P
No
New
Su
pp
ly
Source: CBRE Vietnam, Q4 2016.
Forecast Forecast
2 0 1 7 A S I A P A C I F I C
R E A L E S T A T E M A R K E T O U T L O O K
57
0
50,000
100,000
150,000
2009 2010 2011 2012 2013 2014 2015 2016Net
ab
sorp
tio
n
(NL
A, s
m)
Net Absorption - Grade A Net Absorption - Grade B
N E T A B S O R P T I O N L A G S B E H I N D 2 0 1 5
Source: CBRE Vietnam , Q4 2016.
HANOI – Net Absorption
HCMC – Net Absorption
0
50,000
100,000
150,000
2009 2010 2011 2012 2013 2014 2015 2016
Net
Ab
sorp
tio
n
(NL
A, s
m)
2 0 1 7 A S I A P A C I F I C
R E A L E S T A T E M A R K E T O U T L O O K
58
-2.9% y-o-y
US$ 28.5
+0.6% y-o-y
US$ 17.8
Grade A: Grade B:
HANOI - ASKING RENTS HCMC - ASKING RENTS
US$21.0
+6.2% y-o-y
US$36.6
Grade A: Grade B:
0
10
20
30
40
50
2009 2010 2011 2012 2013 2014 2015 2016
Ask
ing
ren
ts (
US
$ p
sm p
m)
Grade A Grade B
+1.9% y-o-y
M O D E R A T E R E N T A L G R O W T H I N H C M C W H I L E R AT E S AR E S TAB I L I Z I N G I N H AN O I
Source: CBRE Vietnam , Q4 2016.
0
10
20
30
40
50
2009 2010 2011 2012 2013 2014 2015 2016Ask
ing
ren
ts (
US
$ p
sm p
m)
Grade A Grade B
2 0 1 7 A S I A P A C I F I C
R E A L E S T A T E M A R K E T O U T L O O K
59
0%
10%
20%
30%
40%
50%
0
10
20
30
40
50
20
09
20
10
20
11
20
12
20
13
20
14
20
15
20
16
20
17
F
20
18
F
20
19
F
Va
can
cy R
ate
(%
)
Re
nte
(U
S$
psm
pm
)
0%
10%
20%
30%
40%
50%
0
10
20
30
40
50
20
09
20
10
20
11
20
12
20
13
20
14
20
15
20
16
20
17
F
20
18
F
20
19
F
Va
can
cy r
ate
s (%
)
Re
nts
(U
S$
psm
pm
)
HANOI – PERFORMANCE FORECAST HCMC – PERFORMANCE FORECAST
S T I L L L A R G E L Y A T A L E O F T W O C I T I E S L I M I T E D R E N TAL G R O W T H P R O S P E C T S
Source: CBRE Vietnam , Q4 2016.
Forecast Forecast
Grade A – Rents Grade B – Rents
Grade A – Vacancy Grade B – Vacancy The presented rents are rents of Q4 of each respected year.
2 0 1 7 A S I A P A C I F I C
R E A L E S T A T E M A R K E T O U T L O O K
60
Decentralization
Limited space in CBD: • Rental growth for
CBD buildings • Certain winners in
Midtown and West
Flight to Quality
• Big occupiers to relocate and expand to higher quality buildings
Diversified Demand
• High demand from traditional sectors
• Start-ups boom: Growth of Co-working space
Supply Growth
• New supply coming from CBD and Non-CBD area to meet strong market demand
Hanoi HCMC Hanoi & HCMC
O P P O R T U N I T I E S A B O U N D F O R T H E M A R K E T
2 0 1 7 A S I A P A C I F I C
R E A L E S T A T E M A R K E T O U T L O O K
61
2 0 1 7 A S I A P A C I F I C
R E A L E S T A T E M A R K E T O U T L O O K
4. RETAIL
2 0 1 7 A S I A P A C I F I C
R E A L E S T A T E M A R K E T O U T L O O K
62
HCMC
HANOI
0
100,000
200,000
300,000
2009 2010 2011 2012 2013 2014 2015 2016 2017F 2018F 2019F
Su
pp
ly
(NL
A, s
m)
RETAIL SUPPLY GROWTH ACCELERATING IN BOTH C IT IES
0
100,000
200,000
300,000
2009 2010 2011 2012 2013 2014 2015 2016 2017F 2018F 2019F
Su
pp
ly
(NL
A, s
m)
Forecast
Source: CBRE Vietnam , Q4 2016.
2 0 1 7 A S I A P A C I F I C
R E A L E S T A T E M A R K E T O U T L O O K
63
26,000 sm NLA Expected 2018
35,000 sm GFA Expected 2020
59,000 sm NLA Expected 2017
40,000 sm GFA Expected 2017
48,000 sm GFA Expected 2018
53,000 sm GFA Opened Q1 2016
32,000 sm GFA Opened Q2 2016
R O B U S T N E W S U P P L Y I N AN D O U T O F H C M C C B D
2017-2020 Completion (E)
2016 Opening
28,000 sm GFA Opened Q1 2016
50,000 sm GFA Opened Q3 2016
114,000 sm GFA Opened Q3 2016
2 0 1 7 A S I A P A C I F I C
R E A L E S T A T E M A R K E T O U T L O O K
64
BA DINH
TAY HO
HOAN KIEM
DONG DA
HAI BA TRUNG
LONG BIEN
HOANG MAI
CAU GIAY TU LIEM
DONG ANH
HOAI DUC
HA DONG THANH TRI
GIA LAM
THANH XUAN
WEST LAKE
91,000 sm GFA Expected 2019
15,365 sm GFA Expected 2017
41,450 sm GFA Expected 2017
180,000 sm GFA Expected 2018
24,000 sm GFA Opened Q3 2016
26,850 sm GFA Opened Q4 2016
27,000 sm GFA Opened Q4 2016
R E T AI L S U P P L Y I S F U R T H E R D E C E N T R AL I Z E D I N H AN O I
2017-2019 Completion (E)
2016 Opening 18,900 sm GFA Expected 2017
53,864 sm GFA Expected 2018
2 0 1 7 A S I A P A C I F I C
R E A L E S T A T E M A R K E T O U T L O O K
65
P L AC E M AK I N G M AD E I T S W AY T O V I E T N AM
R E TA I L E R S D E M A N D
Source: CBRE Vietnam, Q4 2016.
PLACEMAKING IS ABOUT CREATING AN
ENVIRONMENT THAT PEOPLE WANT
TO VISIT AND RETURN TO
T R AD I T I O N A L VAL U E S W I T H A C R E AT I V E T O U C H
ASIA PACIFIC
VIETNAM
Luxury
F&B Fast Fashion Sport Entertainment
2 0 1 7 A S I A P A C I F I C
R E A L E S T A T E M A R K E T O U T L O O K
66
9%
36% 37%
19%
8%
22%
12%
5%
19% 19%
29%
0%
5%
10%
15%
20%
25%
30%
35%
40%
0
2
4
6
8
10
12
HongKong
India Indonesia Malaysia NewZealand
Philippines Singapore Taiwan Thailand Vietnam Other Asia-Pacific
CA
GR
20
15
-20
20
E-c
om
mer
ce R
even
ue
(US
D b
illi
on
)
2015 E-commerce Revenue CAGR 2015-2020
C H AN G I N G D I G I T AL L AN D S C AP E I N V I E T N AM E - C O M M E R C E : F U T U R E T R E N D ?
Source: CBRE Asia Pacific, 2016
2 0 1 7 A S I A P A C I F I C
R E A L E S T A T E M A R K E T O U T L O O K
67
(US$ per NLA sm on ground and first floor, excl. tax and service charge)
0
30
60
90
120
150
2009 2010 2011 2012 2013 2014 2015 2016
Ask
ing
Ren
t (U
S$
/sm
/mo
nth
)
CBD Non-CBD
CBD
2% y-o-y
-5.9% y-o-y
Non-CBD
R E N T AL G R O W T H L I M I T E D T O C B D M AL L S
0
30
60
90
120
150
2009 2010 2011 2012 2013 2014 2015 2016
Ask
ing
Ren
t (U
S$
/sm
/mo
nth
)
CBD Non-CBD
CBD
15.1% y-o-y
-4.4% y-o-y
Non-CBD
Source: CBRE Vietnam, Q4 2016.
HCMC HANOI
2 0 1 7 A S I A P A C I F I C
R E A L E S T A T E M A R K E T O U T L O O K
68
0%
10%
20%
30%
0
20
40
60
80
2009 2010 2011 2012 2013 2014 2015 2016 2017F 2018F 2019F
Va
can
cy R
ate
(%
)
Ren
t (U
S$
/sm
/mo
nth
)
HANOI
R E N T AL R AT E S T O S T AB I L I Z E AM I D S T F U R T H E R S U P P L Y
0%
10%
20%
30%
0
20
40
60
80
2009 2010 2011 2012 2013 2014 2015 2016 2017F 2018F 2019F
Va
can
cy R
ate
(%
)
Ren
t (U
S$
/sm
/mo
nth
)
Rent Vacancy
HCMC
Source: CBRE Vietnam , Q4 2016.
Forecast
2 0 1 7 A S I A P A C I F I C
R E A L E S T A T E M A R K E T O U T L O O K
69
2 0 1 7 A S I A P A C I F I C
R E A L E S T A T E M A R K E T O U T L O O K
5. LOGISTICS
2 0 1 7 A S I A P A C I F I C
R E A L E S T A T E M A R K E T O U T L O O K
70
Electronics Automobile & Motorcycle
E-commerce
Local Foreigner
RISING DEMAND FROM E-COMMERCE AND HI-TECH SECTORS
M O R E Q U AL I T Y S U P P LY
Source: CBRE Vietnam , Q4 2016.
2 0 1 7 A S I A P A C I F I C
R E A L E S T A T E M A R K E T O U T L O O K
71
0%
6%
12%
18%
24%
30%
0
40
80
120
160
200
2015 2016 2017F 2018F 2019F
Va
can
cy R
ate
NF
A (
'00
0 s
qm
)
New Supply - South New Supply - NorthVacancy Rate - South Vacancy Rate - North
0%
6%
12%
18%
24%
30%
0
40
80
120
160
200
2015 2016 2017F 2018F 2019F
Va
can
cy R
ate
NF
A (
'00
0 s
qm
)
New Supply - South New Supply - NorthVacancy Rate - South Vacancy Rate - North
Warehouse - New supply and vacancy rate Ready-built-factory - New supply and vacancy rate
Source: CBRE Vietnam , Q4 2016. Southern area: HCMC, Long An, Binh Duong, Dong Nai Northern area: Bac Ninh, Bac Giang, Ha Noi, Hai Phong, Hung Yen
M O R E Q U AL I T Y S U P P LY
M O V I N G U P T H E V AL U E C H AI N
FTAs alternative for TPP.
Supply: more quality
supply from both
foreigner and local
developers.
Demand: more demand
from electronics, e-
commerce and FMCG
sectors.
Rents: large number of
supply in 2017 lead to
slower growth in rents
Forecast Forecast
2 0 1 7 A S I A P A C I F I C
R E A L E S T A T E M A R K E T O U T L O O K
72
0%
3%
6%
9%
12%
15%
0
1
2
3
4
5
2015 2016 2017F 2018F 2019F
% G
row
th Y
-o-Y
Ren
tal
rate
(U
S$
/sm
/mo
nth
)
Rents - South Rents - North
Rental Growth - South Rental Growth - North
Warehouse - rental rate Ready-built-factory - rental rate
M O D E S T R E N T AL G R O W T H P R O S P E C T S
0%
3%
6%
9%
12%
15%
0
1
2
3
4
5
2015 2016 2017F 2018F 2019F
% G
row
th Y
-o-Y
Ren
tal
rate
(U
S$
/sm
/mo
nth
)
Rents -South Rents - North
Rental Growth - South Rental Growth - North
Source: CBRE Vietnam , Q4 2016. Southern area: HCMC, Long An, Binh Duong, Dong Nai Northern area: Bac Ninh, Bac Giang, Ha Noi, Hai Phong, Hung Yen
Forecast Forecast
2 0 1 7 A S I A P A C I F I C
R E A L E S T A T E M A R K E T O U T L O O K
73
2 0 1 7 A S I A P A C I F I C
R E A L E S T A T E M A R K E T O U T L O O K
2 0 1 7 A S I A P A C I F I C
R E A L E S T A T E M A R K E T O U T L O O K
74
City Venue Date
Hanoi, Vietnam Lotte Hotel Hanoi January 10
Ho Chi Minh City, Vietnam Park Hyatt Saigon January 12
Shenzhen, China Langham January 13
Beijing, China China World Hotel January 17
Shanghai, China Four Seasons January 18
Kuala Lumpur, Malaysia TPC Kuala Lumpur January 20
Singapore Arts House January 24
Seoul, South Korea Four Seasons February 14
Sydney, Australia Sydney Conservatorium of Music February 22
Brisbane, Australia To be announced March 7
Melbourne, Australia Park Hyatt Melbourne March 9
Auckland, New Zealand To be announced March 14
Hong Kong To be announced April 5
New Delhi, India To be announced April 19
Adelaide, Australia To be announced May 9
Perth, Australia To be announced May 11
Tokyo To be announced June 2
2 0 1 7 R O A D S H O W S AV E T H E D AT E
ASIA PACIFIC
REGIONAL REPORT
JANUARY 24
VIETNAM NATIONAL
REPORT
MID-FEBRUARY
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R E A L E S T A T E M A R K E T O U T L O O K
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This presentation has been prepared in good faith based on CBRE’s current views of the commercial real-estate market.
Although CBRE believes its views reflect market conditions on the date of this presentation, they are subject to significant
uncertainties and contingencies, many of which are beyond CBRE’s control. In addition, many of CBRE’s views are
opinion and/or projections based on CBRE’s subjective analyses of current market circumstances. Other firms may have
different opinions, projections and analyses, and actual market conditions in the future may cause CBRE’s current views
to later be incorrect. CBRE has no obligation to update its views herein if its opinions, projections, analyses or market
circumstances later change.
Nothing in this presentation should be construed as an indicator of the future performance of CBRE’s securities or of the
performance of any other company’s securities. You should not purchase or sell securities – of CBRE or any other
company – based on the views herein. CBRE disclaims all liability for securities purchased or sold based on information
herein, and by viewing this presentation, you waive all claims against CBRE and the presenter as well as against CBRE’s
affiliates, officers, directors, employees, agents, advisers and representatives arising out of the accuracy, completeness,
adequacy or your use of the information herein.
D I S C L A I M E R S A N D W A I V E R S
Thank You
2 0 1 7 A S I A P A C I F I C
R E A L E S T A T E M A R K E T O U T L O O K