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3 MARKET INSIGHTS FROM CBRE’S HANOI QUARTERLY REPORT | Q2 2013
Q2 2013 ECONOMIC OVERVIEW
VIETNAM ECONOMY
Source: Vietnamese General Statistics office
Q2/2012
Y-o-Y
Q1/2013
Q-o-Q Q2/2013
GDP (% y-o-y) 4.8% 4.8% 5.0%
CPI (% y-o-y, e-o-p) 6.9% 6.6% 6.7%
Exchange rate (e-o-p) 20,828 20,828 21,036
Export (US$ Bn) 28.6 29.7 32.4
Import (US$ Bn) 29.0 29.2 34.3
FDI Implemented (US$ Bn) 2.9 2.7 3.0
International Tourist Arrivals (million arrivals) 1.5 1.8 1.7
Retail and Services Turnover (tril. dong) 567.7 636.1 639.3
20700,0
20800,0
20900,0
21000,0
21100,0
Feb-12 Apr-12 Jun-12 Aug-12 Oct-12 Dec-12 Feb-13 Apr-13 Jun-13
Inte
rba
nk
exch
an
ge
rate
1% adjustment Stable exchange rate
4 MARKET INSIGHTS FROM CBRE’S HANOI QUARTERLY REPORT | Q2 2013
GOVERNMENT POLICIES
Expansion Monetary Policies Fiscal Policies - Tax Cut
Devaluation of the dong 1% versus the dollar
( to VND21,036)
The interest-rate ceilings on short-term
dong-denominated bank deposits: lowered to
7.0% from 7.5%
The ceiling on dollar deposits:
• For institutional depositors: fall to 0.25%
from 1.0%
• For individual depositors: fall to 1.25%
from 2.0%.
Corporate Income Tax:
• Cut from 25% to 22%; Effective 1/1/2014.
• In 2016: cut further to 20%.
For SMEs that have less than VND20bn revenue per year:
• The tax rate will be 20%
For social housing:
• Corporate tax rate: 10%; VAT: cut from 10% to 5%.
Personal income tax:
• The level of deduction: increased to VND9 million/per month
from VND4 million/ month;
• The level of deduction for each dependent: increased to
VND3.6/ month from VND1.6 million per month for one.
dependent.
• Boost domestic consumption and production
• Improve trade balance
• Reduce banks' funding costs => Lend
at lower rates
• Encourage to exchange USD for VND
• Bolster its foreign-exchange reserves
5 MARKET INSIGHTS FROM CBRE’S HANOI QUARTERLY REPORT | Q2 2013
Q2 2013 ECONOMIC OVERVIEW Gold Price And Bank Deposits Become Less Attractive
Global gold price: decrease 24%
YTD.
Local gold price: reached its
trough in June (22%) and
currently downed 19% YTD
Policy rates: 800bps reduction
over the last 18 months.
-1
0
1
2
3
4
0
5
10
15
20
25
Dec-10 Mar-11 Jun-11 Sep-11 Dec-11 Mar-12 Jun-12 Sep-12 Dec-12 Mar-13 Jun-13
CPI (%
m-o
-m)
CPI (%
y-o
-y)
/ In
tere
st ra
tes
(%)
CPI (y-o-y, Vietnam) Rediscounting Rate Refinancing Rate CPI (m-o-m, Vietnam)
Monetary contraction
Inflation surged
Monetary expansion
Inflation controlled
1,000
1,200
1,400
1,600
1,800
2,000
30
34
38
42
46
50
09/2011 12/2011 03/2012 06/2012 09/2012 12/2012 03/2013 06/2013
Glo
bal gold
price
(U
S$)
Loca
l gold
sell p
rice
(VN
D m
illion)
LOCAL GOLD GLOBAL GOLD
Source: SJC
Source: State Bank of Vietnam
6 MARKET INSIGHTS FROM CBRE’S HANOI QUARTERLY REPORT | Q2 2013
,0
500,0
1000,0
1500,0
2000,0
2500,0
3000,0
300
350
400
450
500
550
Jun 11 Sep 11 Dec 11 Mar 12 Jun 12 Sep 12 Dec 12 Mar 13 Jun 13
Tra
din
g V
alu
e (
Bill
ions V
ND
)
VN
Index
Trading value VNIndex
Q2 2013 ECONOMIC OVERVIEW
Regional stock markets, 1
year return as of July 05,
2013:
Thailand (SET) up 21.1%;
Singapore (SGX) up 15.2%;
Indonesia (JCI) up 15.8%;
Vietnam (VNINDEX) peaked
at 528 points in June, up
26%, currently up 21.1%.
Stock Market Recovers, Real Estate Will Come Back To Focus
REAL ESTATE INDEX 2Y 1Y 6M 3M 1M Current
Real Estate Holding &
Development Listed
Companies
55.5 44.8 39.5 41.9 42.2 45.4
Real Estate Services Listed
Companies 84.4 25 23.8 25.3 22.3 26.1
Source: Stockbiz
Source: FPTS, gold.org
Source: Bloomberg
7 MARKET INSIGHTS FROM CBRE’S HANOI QUARTERLY REPORT | Q2 2013
Vietnam Hanoi
GDP (% y-o-y) 5.00 (↑) 7.84 (↑)
CPI (% y-o-y, average) 6.55 (↓) 5.4(↓)
Exchange rate (e-o-p) 20,828 20,828
Export (US$ Bil.) 33.1 (↑) 2.63 (↑)
Import (US$ Bil.) 34.8 (↑) 6.55 (↑)
FDI Registered (US$ Bil.) 4.44 (↓) 0.3 (↑)
FDI Implemented (US$ Bil.) 3.00 (↑) -
FDI Real Estate (US$ Bil.) 0.17 (↓) -
International arrivals (mil.) 1.74 (↓) 0.5 (↑)
Hanoi Economy At A Glance
HANOI ECONOMIC OVERVIEW
Credit growth ↑ to 3.31% from 0.1% in Q1
GDP ↑ to 5% from 4.76% in Q1
FDI inflow ↑ 15.9% y-o-y
NPL ↓ to 4.65% from 6% in Q1
IIP ↑ to 6% from 4.5% in Q1
Domestic conditions start to improve while policies
continue to focus on unresolved problems and growth
Credit Growth (%)
-5%
5%
15%
25%
35%
45%
2009 2010 2011 2012 Q1/2013 Q2/2013
Vietnam Hanoi
8 MARKET INSIGHTS FROM CBRE’S HANOI QUARTERLY REPORT | Q2 2013
HANOI ECONOMIC OVERVIEW
Number of enterprises (y-o-y)
• Went bankrupt ↑ 35.4%
• Stopped operating ↑ 5.4%
• Newly registered ↓ 12.5%
Decree 02: VND 30tril packages for home buyers - A Push For Real
Estate or A Slat in the Lake?
• Doesn’t solve the core problem of the real estate market as the package
concentrates on helping low-end segment. By the end of Q1/2013, the value of real
estate firms’ unsold stocks is estimated to reach VND 112tril, focused primarily on
mid to high-end segments… contradiction in markets.
• Unclear mechanism between eligible buyers, banks, and eligible developers,
complicated and vague borrowing procedures limited the effect of the policy upon the
market.
Challenges ahead
9 MARKET INSIGHTS FROM CBRE’S HANOI QUARTERLY REPORT | Q2 2013
Q2 Highlights
HANOI INFRASTRUCTURE
Cat Linh – Ha Dong
Urban railway: By
Q2/2013, total
construction progress
reached 39%, side
clearance of 9.2/13.5km
main route
Nhat Tan – Noi Bai
Bridge: Total
construction progress
reached 67%,
expected completion in
Q3/2014
Dai Co Viet – Tran Khat
Chan Flyover: expected
completion in Q3/2013
Kim Ma – Nguyen Chi
Thanh Flyover: The
intersection between Kim
Ma-Nguyen Chi Thanh
has been closed down
for 2 months from May to
July for construction,
expected completion in
Q3/2013
O Cho Dua Flyover:
Side clearance
completed ; issues
remain around Xa Tac
Historical Monuments
11 MARKET INSIGHTS FROM CBRE’S HANOI QUARTERLY REPORT | Q2 2013
CONDOMINIUM FOR SALE Supply: Launched vs. Completed
New Launch Supply (Units)
0
5,000
10,000
15,000
20,000
25,000
2007 2008 2009 2010 2011 2012 2013
Q1 Q2 Q3 Q4 Whole year
0
2,000
4,000
6,000
8,000
10,000
2007 2008 2009 2010 2011 2012 2013
YTD
Q1 Q2 Q3 Q4 Whole year
New Completion Supply (Units)
YTD
Number of units launched in Q2 up slightly compared to Q1 (+7%) but number of
launches up 88% lower units per launch
Number of units launched in H1 2013 ~ 36% of 2012 and ~14% of 2011, but
Number of units completed in H1 2013 ~90% of 2012 and ~167% of 2011
12 MARKET INSIGHTS FROM CBRE’S HANOI QUARTERLY REPORT | Q2 2013
CONDOMINIUM FOR SALE New launches continued to focus on low- to mid-end segments
0%
20%
40%
60%
80%
100%
2008 2009 2010 2011 2012 2013YTD
Luxury High-end Mid-end Low-end
Units Launched by Grade
25%
12%
6%31%
7%
8%
11%
Hai Ba Trung
Thanh Xuan
Cau Giay
Tu Liem
Ha Dong
Long Bien
Others
2007 – 2011: luxury + high-end accounted for 25% of new launches on average
2012 – now: luxury + high-end account for less than 10% of new launches
Launches trending to reflect real demand - end user
Units Launched by District
13 MARKET INSIGHTS FROM CBRE’S HANOI QUARTERLY REPORT | Q2 2013
CONDOMINIUM FOR SALE Prices: Where is the bottom?
0%
20%
40%
60%
80%
100%
2008 2009 2010 Q1
2011
Q2 Q3 Q4 Q1
2012
Q2 Q3 Q4 Q1
2013
Q2
Below $1,000 psm $1,000-$1,250 psm
$1,250-$1,500 psm Above $1,500 psm
-6%
-2%
2%
6%
10%
14%
2009 2010 2011 2012 2013YTD
Distribution of Primary Prices Secondary Price Changes
14 MARKET INSIGHTS FROM CBRE’S HANOI QUARTERLY REPORT | Q2 2013
CONDOMINIUM FOR SALE Prices: Where is the bottom?
Prices offered in 2013 launches are
significantly lower than average of last
5 years due to the shift to low to and
mid-end segments.
Issue of unsold stock has pushed
developers to lower prices in re-
launches.
• But even at lower prices, developers
have to differentiate to secure sales
• In some projects a 30%-50% price
reduction has increased sales
Secondary prices have been falling
for 8 consecutive quarters since 2011
~70% units are traded at discounts
compared to original purchase prices.
Zero liquidity in slow construction
projects even at heavy discounts.
HOWEVER
32% projects saw stable prices in Q2,
compared to only 18% in Q1.
This suggests that prices might have
reached bottom in certain projects.
Primary Market Secondary Market
15 MARKET INSIGHTS FROM CBRE’S HANOI QUARTERLY REPORT | Q2 2013
CONDOMINIUM FOR SALE Demand and Trend
Buyer profile: limited short-term investors,
caution oriented. Owner occupiers prevail.
Investment purposes:
• Primarily long-term / rental purpose.
• Stock, gold, and savings disappoint.
Psychological factors: fear of the boom
and bust, although confidence slowly on its
way back.
Home buyers and Long-term investors.
Price is No. 1 concern - wait and see
attitude is still dominant.
But other factors are important:
• Flexible payment terms and financing support.
• Management services, transparent.
• Facilities quality.
• Community oriented.
Demand Trend: Who buys What?
Q4 2012 Q1 2013
Job prospects 34% positive 39% positive
Saving plan 60% 71%
Intention to
invest in stock 5% 11%
Of people interviewed
Source: Nielsen
16 MARKET INSIGHTS FROM CBRE’S HANOI QUARTERLY REPORT | Q2 2013
Investors are looking at quality products at
reasonable prices.
Price range of VND15-20 mil per sqm appear as
best sell/ target market.
Even at the right price, buyers will need to be
convinced that they will be provided quality
management and facilities.
Real commitment is the key to gaining buyers’
confidence.
Market prices are expected to fall toward the end
of 2013, but fewer projects will experience
decreases as they hit the point where cost exceeds
saleable price
The VND30 trillion package
• Limited impact due to limited eligible buyers
• Unclear mechanism between eligible buyers,
banks, and eligible developers
Outlook
CONDOMINIUM FOR SALE
Hoang Thanh Tower – Hai Ba Trung Dist
• 187 units
• Current asking price: From VND85 mil psm
• Official launch date: July 18
Upcoming Launch
17 MARKET INSIGHTS FROM CBRE’S HANOI QUARTERLY REPORT | Q2 2013
LANDED PROPERTY Supply
New supply
70 units from Dang Xa NUA (Long Bien
Dist) launched in 20/05, to be handed
over in Q4/2013.
Sudico launched 173 landed properties in
June at prices from VND17.8 mil, down
8.3% compared with initial offering price.
Unresolved issues in new supply
Lack of facilities in newly completed
projects.
Values will continue to decline if
supporting and essential facilities are not
added in a timely manner.
Dang Xa NUA Sudico South An Khanh NUA
18 MARKET INSIGHTS FROM CBRE’S HANOI QUARTERLY REPORT | Q2 2013
Downward trend persists
Selling prices in Me Linh dropped (largest) with average decrease of 30%. Tu Liem price declined
about 20% depending on the projects design and facilities, infrastructure being critical.
Long Bien and Hoai Duc, price reduction is 5% -7%. Hoai Duc off a previous high decline.
Projects in Cau Giay, Thanh Tri and Tay Ho slight fall, only 2-3% due to established infrastructure
and Tay Ho is a prestige property after location.
Certain projects in Ha Dong, prices slightly higher than the previous quarter near 10%, near the city.
Secondary asking price
LANDED PROPERTY
Secondary price of landed property (VND mil per sqm)
-20%
-15%
-10%
-5%
0%
5%
10%
-
20,000,000
40,000,000
60,000,000
80,000,000
100,000,000
120,000,000
140,000,000
Q1/11 Q2/11 Q3/11 Q4/11 Q1/12 Q2/12 Q3/12 Q4/12 Q1/13 Q2/13
Average market price Average market change
19 MARKET INSIGHTS FROM CBRE’S HANOI QUARTERLY REPORT | Q2 2013
Low transactions volume although landed
properties are still in demand;
• More projects are completed at attractive price
points; some are even cheaper than some
condominiums.
• “Wait and see” attitude
• Still the preferred property purchase in Hanoi.
• Developers refocused on customer demand at
projects with affordable prices.
Potential: foreign investors
• Investors are reviewing real estate with bad debt
issues, lower price projects or projects facing
finance raising problems.
• Foreign investors can make investment by
investing through capital funds.
• 2013 will be a good year for investors who have
cash in hand to invest in projects.
Vincom Village Project completed
LANDED PROPERTY
Demand
ParkCity now 100% owned by Pernada Parkcity
20 MARKET INSIGHTS FROM CBRE’S HANOI QUARTERLY REPORT | Q2 2013
LANDED PROPERTY
Macroeconomic factors in the market;
• Interest rates down, market did not react.
• Cheap house finance also no impact.
• Gold price declines sharply plus stock market fluctuates, should drive free cash into real estate.
• Time lapse to swap into other investments.
Me Linh, price decrease 50%
Outlook
Outlook
• Asking price is nearer to cost price after
adjustment.
• Buyers expected to regain some confidence
off the back of strong price declines.
• Developers are adjusting prices to match real
market demand.
• In the near future projects will be under
pressure to reduce price where transactions
are slow and prices don’t reflect the current
price trends.
22 MARKET INSIGHTS FROM CBRE’S HANOI QUARTERLY REPORT | Q2 2013
New supply: Q2 2013
OFFICE
Hong Ha Center, lettable area about 11,000 sm
Seven buildings completed this quarter,
supplying more than103,000 sm. Includes:
VCCI Tower
Ngoc Khanh Plaza
Star Tower
Capital Building
Hapulico Complex
Star City Le Van Luong
Song Hong Parkview
Hong Ha Center
VCCI Tower
CBD Supply
Non-CBD Supply
23 MARKET INSIGHTS FROM CBRE’S HANOI QUARTERLY REPORT | Q2 2013
OFFICE
Asking rent
• Average asking rent for Grade A, small
movement of only -1%. New supply and
some price reductions. City owners still
reluctant to price adjust against the West.
• Grade B asking rent continues a downward
trend from Q1, decrease 10% q-o-q. New
supply and landlords waiting to attract or
keep tenants. Discounting will continue.
Vacancy
• Grade A: Average vacancy, slight change,
-2.32% decrease mainly due to Hong Ha
Center entering the market.
• Grade B: Average vacancy 19%, no
movement compared with last quarter. New
supply and tenant movements within the
same category.
Office Asking Rents
Office Vacancy
$0
$10
$20
$30
$40
$50
$60
Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2
2009 2010 2011 2012 2013
Grade A Grade B
0%
5%
10%
15%
20%
25%
30%
35%
40%
45%
Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2
2009 2010 2011 2012 2013
Grade A Grade B
Market Performance
24 MARKET INSIGHTS FROM CBRE’S HANOI QUARTERLY REPORT | Q2 2013
OFFICE
Projects in the West under pressure to reduce rents as supply is large, new competitors for Grade B
category. Still a tenants market.
• Tenants have bargaining power and control.
• CFO are driving the decision process, then landlord promotions and supporting services are other
key drivers.
• Safety and condition in buildings are a growing and important factor. OH and S a key point with
foreign firms as well as local occupiers.
• Tenants will consider good options and terms to relocate.
Landlords
• Currently, price is a strategy to compete. Landlords alternatively are focused on discounting, rent
frees and extended fit out periods to improve their market position.
• Landlords have also matched the market and some buildings that previously were offering a
higher grade rent have had to adjust down.
• Landlords to meet the tenants expectations have had to upgrade facilities and amenities to
compete with better buildings entering the market.
Outlook
25 MARKET INSIGHTS FROM CBRE’S HANOI QUARTERLY REPORT | Q2 2013
Future supply Q3 and Q4 2013
OFFICE
Grade B
Seven buildings, supply of more than 153,000
sm. Including:
PVI Tower
Diamond Flower Tower
Capital Garden
Diamond PVCI Building
Royal City
MD Complex Tower
Hei Tower
PVI Tower
Royal City office building
26 MARKET INSIGHTS FROM CBRE’S HANOI QUARTERLY REPORT | Q2 2013
RETAIL The future, from traditional markets modern shopping centers
Hang Da Galleria - closed
Cua Nam Market – soft performance
Cho Mo Shopping Center – opening date
postponed serveral times
Will it be successful?
27 MARKET INSIGHTS FROM CBRE’S HANOI QUARTERLY REPORT | Q2 2013
RETAIL Q2/2013 Review
Market performance
• Average rents declined q-o-q across shopping
centers and retail lobbies.
– Rents in CBD and non-CBD declined by 3.7 –
3.8% q-o-q.
– Rents in non-CBD declined sharply y-o-y (13.1%)
– CBD rents declined slightly (0.8%) y-o-y. Trang
Tien Plaza entered the market at high asking
rents.
• Occupancy declined 2.7% q-o-q. 1.8% y-o-y.
– Retail lobbies remained stable.
– Department stores highest decrease in
occupancy (-11% q-o-q), Parkson
Keangnam had a decline in sub let tenants.
Demand
• 62 stores opened while 60 stores closed in
shopping centers (compared to 121 stores
opened and 172 stores closed in Q1/2013)
Retail Ground Floor Rents
Retail Vacancy
-10%
0%
10%
20%
30%
2008 2009 2010 2011 2012 2013 Q2
CBD non-CBD
$0
$20
$40
$60
$80
$100
$120
2007 2008 2009 2010 2011 2012 2013 Q2
CBD non-CBD
28 MARKET INSIGHTS FROM CBRE’S HANOI QUARTERLY REPORT | Q2 2013
RETAIL Market Outlook
Future supply anticipated
• 670,000 sqm from 10 near complete
projects.
Investment channel
• Amended ENT: Foreign invested enterprises
may be exempted from the economic needs
test (ENT) process when opening additional
retail outlets:
• Ocean Group continues expanding
investment in retail with Star City Centre
(180,000 sqm, under planning).
• Ministry of Industry & Trade’s planning up to
2020 requires Vietnam to develop 1,200 –
1,300 supermarkets (increased by 600
compared to 2011), 180 trade centers
increased by 82 compared to 2011) and 157
shopping centers.
0
200,000
400,000
600,000
800,000
1,000,000
2013f 2014f
Fitting-Out Under Construction Under Planning
Future supply
Star City – under planning
29 MARKET INSIGHTS FROM CBRE’S HANOI QUARTERLY REPORT | Q2 2013
RETAIL Future projects
Parkson Landmark Shopping center (Tu Liem)
• Level 2,3,4 in Keangnam
• Total area: 5,500 sqm
Ocean Mall, Thang Long International Village
(Cau Giay)
• Total area: ~10,000 sqm
• Ocean mart occupies level1
Ho Guom Plaza Shopping center (Thanh Xuan)
• Total area: 10,300 sqm
• Tran Anh anchor tenant
• 60% commited, Tran Anh electronics and
supermarket
Ocean Mall, Trung Hoa Nhan Chinh (Cau Giay)
• Total area: ~18,000 sqm
• Expected opening: Q4/2013
30 MARKET INSIGHTS FROM CBRE’S HANOI QUARTERLY REPORT | Q2 2013
RETAIL Future projects
Vincom Mega Mall, Royal City (Thanh Xuan)
• Total area: 250,000 sqm
• Expected opening time: Q3/2013
• 85% pre-committed
Vincom Mega Mall, Times City (Phase 1)
(Hai Ba Trung)
• Total area: 130,000 sqm
• Expected opening time: Q4/2013
• Retail space for lease
Warburg Pincus Consortium invested US$200
Million in Vincom Retail
Royal City Mega Mall
Times City Mega Mall
32 MARKET INSIGHTS FROM CBRE’S HANOI QUARTERLY REPORT | Q2 2013
HOTEL Market Snapshot
Two new 4-star
hotels: Candeo
Hotel (72 rooms),
Hilton Garden Inn
Hanoi (86 rooms)
Hilton Garden Inn Hanoi
33 MARKET INSIGHTS FROM CBRE’S HANOI QUARTERLY REPORT | Q2 2013
0
100
200
300
400
500
600
2009 2010 2011 2012 Q2/2013
HOTEL
Supply
• Current: 8,831 rooms, Hoan Kiem & Ba Dinh in
the main
• Supply up 2.8% y-o-y
• New projects: Hoan Kiem (Hilton) Ba Dinh
(Candeo)
Market Performance
• 4-star hotel ADR increased 0.17% q-o-q and 0.4%
y-o-y
• 5-star segment declined (Occupancy ↓0.19%,
ADR ↓4.4%, RevPar ↓0.8%, q-o-q)
Demand
• International overnight visitor, 1st 6 months 2013,
Hanoi: 929 000, up 21.5% compared with first 6
months 2012. Domestic visitors, up 12%.
Q2 Review
-8%
-6%
-4%
-2%
0%
2%
4%
5-star 4-star 3-star
Occupancy ADR RevPAR
Y-o-Y Changes by Grade (Q1/2013)
Visitor Arrivals to Hanoi (thousand)
34 MARKET INSIGHTS FROM CBRE’S HANOI QUARTERLY REPORT | Q2 2013
HOTEL
Future Supply
• Q3/2013
– InterContinental Hanoi Landmark (359 rooms),
JW Marriot (450 rooms),
• End 2013 (existing and future supply)
– 9,840 rooms, up 13.5% y-o-y.
– 5 star hotels, market share 47%.
Outlook
0
2,000
4,000
6,000
8,000
10,000
12,000
1995 2000 2005 2010 2011 2012 2013 Q1 2013f
5-star 4-star 3-star
Historical Supply by Grade
Demand
• Tour costs are high compared to some cities in the region (US$200 for 4-day trip in
Cambodia, US$ 300 for a Hanoi – HCM two-way flight).
• Visa registration fee US$ 25/ person to US$ 45/ person (Cambodia US$ 20).
Investment Channel
• Over supply especially 5-star segment.
• Disinvesting: many hotels are offered for sale.
35 MARKET INSIGHTS FROM CBRE’S HANOI QUARTERLY REPORT | Q2 2013
SERVICED APARTMENT Market Snapshot
New projects: Candeo Hotel (70 rooms), My Way Hotel & Residence
(62 rooms), Dolphin Plaza (70 rooms)
Candeo Hotel Hanoi Dolphin Plaza My Way Hotel
36 MARKET INSIGHTS FROM CBRE’S HANOI QUARTERLY REPORT | Q2 2013
SERVICED APARTMENT
Occupancy
• International operator groups: 88%, down from 90%
• Self-managed group: 81%, up from 79%
Asking rents
• Decrease of 2.2% q-o-q (International operators)
• Decrease of 1.5% q-o-q (Self-managed projects)
Q2/2013
$0
$20
$40
$60
2007 2008 2009 2010 2011 2012 2013
International Operator Self-managed
Average
Average asking rents (US$/sqm/month)
Historical Vacancy & Supply
0
500
1,000
1,500
2,000
2,500
3,000
3,500
0%
5%
10%
15%
20%
25%
30%
2007 2008 2009 2010 2011 2012 2013
Supply Vacancy Rate (%)
10%
22%
25%
31%
4%
7%Hoan Kiem
Ba Dinh
Tay Ho
Cau Giay
Hai Ba Trung
Tu Liem
Me Linh
Supply by district, Q2/2013
37 MARKET INSIGHTS FROM CBRE’S HANOI QUARTERLY REPORT | Q2 2013
SERVICED APARTMENT
Demand
• Volume of enquiries declined slightly, budgets
lower by ~9% q-o-q (US$1,500 - 2,000)
• Further company budget cuts expected.
• Enquiries: Japanese: CBD, Westlake, movement
to the west (lower grade). Relocations to the West
by many large companies.
Market outlook
• Upcoming serviced apartments:
– Elegant Tay Ho, 140 units (Q4/2013)
– Lotte Center Hanoi, 260 units (2014)
• Market trend: Buy to Let… Royal City, Hoang
Thành, Times City etc.
• Hotels consider converting part into serviced
apartments.
Demand & Outlook
Lotte Center Hanoi, 2014
T +844 2220 0220
F +844 2220 2010
CBRE QUARTERLY REPORT
Available by better-priced sector now
Longer historical data, In-depth analysis [email protected]
CBRE Vietnam – Research & Consulting – Hanoi Office