REAL ESTATE DEVELOPMENT IN CENTRAL VIETNAM News December/CBRE Updat… · 12 CBRE | REAL ESTATE DEVELOPMENT IN CENTRAL VIETNAM | Q4 2016 Booming condo-tel market with good absorption

1 CBRE | REAL ESTATE DEVELOPMENT IN CENTRAL VIETNAM | Q4 2016

REAL ESTATE DEVELOPMENT

IN CENTRAL VIETNAM

Thursday, 24th November 2016

Presented by: Ms. Dung Duong

Director, CBRE (Vietnam)

DA NANG


CONTENT

1. Da Nang Economic Overview

2. Vacation Property Market

3. Hotel Market

4. Investment

5. Market Outlook


If a site is good, a bird will come

DA NANG ECONOMY


Da Nang leads PCI 2015 while Khanh Hoa’s PCI ranked 27th

PROVINCIAL COMPETITIVENESS INDEX

Source: VCCI


Da Nang has withdrawn some projects due to slow progress and

rejected those which threaten the environment

FOREIGN DIRECT INVESTMENT

Note: FDI data up to 8M 2016

-20

0

20

40

60

80

100

-100

0

100

200

300

400

500

600

2011 2012 2013 2014 2015 Q1 2016 Q2 2016 Q3 2016

No

. o

f P

roje

cts

FD

I (U

SD

Mill

ion

)

Newly-regislered and increased FDI capital No of new and increased FDI projects

Source: Da Nang’s Department of Statistics

Foreign Direct Investment in Da Nang


INFRASTRUCTURE

2015

Da Nang Railway

Station to be

demolished and

replaced by a new

one by 2019

Da Nang International Airport: accelerated construction and will be ready for APEC 2017

2016 2020

Da Nang-

Quang Ngai

Highway planned

opening to traffic

in 2016

Da Nang Port (P2)

to be launched

in 2018

Da Nang - Hoi An

Monorail

Bus Rapid Transit

route connecting

Da Nang - Hoi An


Expanding Airport for more flights

INFRASTRUCTURE


TOURISM FACILITATION Full of Summer events in coastal cities


Big Improvement

TOURIST ARRIVALS TO DANANG


VACATION PROPERTY MARKET


BUSY CONSTRUCTION ACTIVITIES IN DA NANG


Booming condo-tel market with good absorption

DA NANG CONDO-TEL MARKET

Da Nang Nha Trang

Source: CBRE Vietnam. Source: CBRE Vietnam.

0

2,000

4,000

6,000

8,000

2013 2014 2015 9M2016

Supply Sold units

0

2,000

4,000

6,000

8,000

2013 2014 2015 9M2016

Supply Sold units

~ 5,000 units launched

in 9M2016

~ 2,800 units sold

in 9M2016

~ 2,900 units launched

in 9M2016

~ 3,200 units sold

in 9M2016

Condo-tel, Accumulated Supply and Sold Unit Condo-tel, Accumulated Supply and Sold Unit




Lower prices due to pressure from new launches



Expected Completion



Limited New Supply

DA NANG SECOND HOME VILLA MARKET

0

200

400

600

800

2014 Q1 Q2 Q3 Q4 Q1 Q2 Q3

2015 2016

Luxury High-end Mid-end

Da Nang Second Home Villa, Accumulated Supply (Number of villas)


Villa sale shows moderate improvement

SECOND HOME VILLA MARKET

103 units

2014

481 units

2015

Nha Trang

9M 2016

396 units

2014 Source: CBRE Vietnam.

Phu Quoc

2014 2015 9M 2016

0 units

850 units

140 units

Source: CBRE Vietnam.

7 units

180 units

2015 9M 2016

Da Nang

52 units



Da Nang Price discovery

SECOND HOME VILLA MARKET

*Asking prices are quoted in USD, exclusive of VAT and maintenance fee.

Source: CBRE Vietnam, Q3 2016.

Premier Village Average price:$2,800/m2 Unit size (GFA): 335-510 m2

Total unit: 118

Nam An Residence

Average price: $1,338/m2 Unit size (GFA):245 - 335m2

Total unit: 18 (1st launch)

Ocean Estate Average price: $1,673/m2 Unit size (GBA): 570-740 m2

Total unit: 33

Hyatt Regency Average price: $4,931/m2 Unit size (GFA): 307 m2

Total unit: 27

Vinpearl Premium Average price: $4,851/m2 Unit size (GFA): 348 – 526 m2

Total unit: 39

Furama Pool Villas Average price: $1,867/m2 Unit size (GFA): 322 – 386 m2

Total unit: 134

Vinpearl Da Nang 2 Average price: $2,860/m2 Unit size (GFA): 180 - 330 m2

Total unit: 122 units

Ocean Villas Average price: $1,453/m2 Unit size (GFA): 271 – 373 m2

Total unit: 110

Mercure Son Tra Average price: $2,146 m2 Unit size (GFA): 374 - 543 m2

Total unit: 22

Olalani Condotel & Resort Average price: $5,600/m2 Unit size (GFA): 340– 470 m2

Total unit: 3 The Song Average price: N/A Unit size (GFA): N/A Total unit: 48


90% of Condo-tel projects; Premier Village Danang Resort;

Vinpearl Resort & Villas

3-10 years Guaranteed yield at

8% - 12% per year (VND)

PHU QUOC – Rental Pool Villas

Guaranteed Yield Program remains a main S&M strategy

VACATION PROPERTY

Phu Quoc Emerald Bay, Phu Quoc Premier Village,

Vinpearl Paradise Villas

Guaranteed yield 9% - 10% per year

Or 85% of revenue after tax in 10 years

DA NANG – Condo-tel/ Villas

NHA TRANG – Condo-tel/ Villas

90% of projects applied guaranteed yield with

8% - 10% per year in 3 - 10 years

Source: Retrieved from the internet, September 2016.


Buyers’ Profile

VACATION PROPERTY


HOTEL MARKET


Da Nang: 3-5 Star Hotels Double in the Next 3 years

HOTEL MARKET


Da Nang: A variety of choices for travellers

HOTEL MARKET


Expansion of International brands

HOTEL MARKET


HOTEL MARKET Occupancy rate


0%

20%

40%

60%

80%

Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3

2014 2015 20165 star - Beachfront 5 star - City Hotel

4 star - Beachfront 4 star - City Hotel

20%

40%

60%

80%

Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3

2014 2015 2016

5 star - Beachfront 5 star - City Hotel 4 star - Beachfront 4 star - City Hotel

Da Nang, 3-5 Star Hotels, Occupancy Rate


HOTEL MARKET Average Daily Rate (ADR)

$0

$50

$100

$150

$200

Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3

2014 2015 2016

5 star - Beachfront 5 star - City Hotel 4 star - Beachfront 4 star - City Hotel

Da Nang, 3-5 Star Hotels, ADR (US$/room/night)


Chinalization – A New Trend

HOTEL MARKET

Lead the top guest arrivals to

Da Nang & Nha Trang

Prefer Coastal cities, specifically

Nha Trang & Da Nang

Low spending $70/day/guest

Direct flight from 12 cities in China


INVESTMENT


Latest development site transaction

INVESTMENT

DA PHUOC INTERNATIONAL NEWTOWN project changes to THE SUNRISE BAY

● Investor: Novaland Group

● Seller: Daewon Cantavil Co., Ltd

● Value: N/A

● Scale: 180 ha


MAJOR INVESTMENT DEALS IN DA NANG

● Investor: Success Dragon

● Seller: My Ngoc Nguyen

● Value: US$31.4 mil.

● Scale: 206 hotel rooms

● Date: Q1 2016

One Opera Danang

● Investor: TBS

● Seller: Indochina Land


● Scale: 18 holes golf

course + 66 villas

● Date: Q2 2014

Montgomerie Links

Source: CBRE, DealStreetAsia, RCA Q1 2016

Hyatt Regency

● Investor: Gaw Capital

Partners


● Value: N/A

● Scale: 193 hotel rooms + 180

condo. units + 27 villas

● Date: Q2 2015

● Investor: BRG

● Seller: VinaCapital

● Value: N/A

● Scale: 18 holes golf.

● Date: Q2 2016

Danang Golf Club The Nam Hai

● Investor: N/A

● Seller: Crescent Point

● Value: US$60 - 65 mil.

● Scale: 100 hotel rooms + rental

pool business

● Date: Q1 2016

HAGL Complex

● Investor: Quoc Cuong Gia Lai

● Seller: HAGL


● Scale: 2.6 ha.

● Date: Q2 2016

Jan 2015 Mar 2016

Golden Square Marina

● Investor: Quoc Cuong Gia Lai

● Seller: VinaCapital

● Value: N/A

● Scale: 17.6 ha

● Investor: Anphanam

● Seller: Dong A Land

● Value: N/A

● Scale: 1.1 ha

● Date: Q1 2016

Indochina Riverside

● Investor: Kajima


● Value: US$15 - 20 mil.

● Scale: 0.4 ha


Hotels saw a surge in interest

CBRE INVESTOR INTENTION SURVEY 2016

Source: CBRE Asia Pacific Investor Intentions Survey 2014, 2015 and 2016

Preferred sector for investment


Asset Pricing and Market Transparency remain challenges

CBRE INVESTOR INTENTION SURVEY 2016

Source: CBRE Asia Pacific Investor Intentions Survey 2016.


MARKET OUTLOOK


NEW FACE OF DA NANG IN THE NEXT FIVE YEARS


DEMAND ABSOPRTION RATE PRICE/RENT SUPPLY

Beach-

front In City

Beach-

front In City

Beach-

front In City

Beach-

front In City

CONDO-TEL

SECOND-HOME

VILLAS

HOTEL/RESORT

2017 OUTLOOK


© 2016 CBRE Co., Ltd. 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.

For more information regarding this presentation please contact: CBRE Vietnam Co., Ltd. – Research & Consulting T +84 8 3824 6125

F +84 8 3823 8418

Email: [email protected]

THANK YOU

REAL ESTATE DEVELOPMENT IN CENTRAL VIETNAM News December/CBRE Updat… · 12 CBRE | REAL ESTATE DEVELOPMENT IN CENTRAL VIETNAM | Q4 2016 Booming condo-tel market with good absorption

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REAL ESTATE DEVELOPMENT IN CENTRAL VIETNAM News December/CBRE Updat… · 12 CBRE | REAL ESTATE DEVELOPMENT IN CENTRAL VIETNAM | Q4 2016 Booming condo-tel market with good absorption