Evolution of Vietnamese Retail
Transcript of Evolution of Vietnamese Retail
7/29/2019 Evolution of Vietnamese Retail
http://slidepdf.com/reader/full/evolution-of-vietnamese-retail 1/20
7/29/2019 Evolution of Vietnamese Retail
http://slidepdf.com/reader/full/evolution-of-vietnamese-retail 2/20
Vietnam has a small sharebut large potential
China
Hong Kong
India
IndonesiaKoreaMalaysiaPhillippines
Singapore
Taiwan
Thailand
Vietnam
Japan
Australia
Percentage Share of GDP in Asia Pacific, 2010
Regional GDP share
7/29/2019 Evolution of Vietnamese Retail
http://slidepdf.com/reader/full/evolution-of-vietnamese-retail 3/20
GDP in Asia is set for strong growth, Vietnam 3rd strongest CAGR 5 Years CAGR of Nominal GDP in Asia Pacific, 2010 – 2015F
Source: Focus Economics, Savills Research & Consultancy
0%
2%
4%
6%
8%
10%
12%
14%
16%
18%
India China Vietnam Phillippines Indonesia Thailand Malaysia Korea Singapore Taiwan Hong Kong UnitedStates
Australia Euro Area Japan
GDP CAGR
CountryPrivate
Consumption
as % of GDP
U.S. 71.0
Korea 68.0
Vietnam 66.0
Hong Kong 61.5
Taiwan 60.8
Japan 58.1
Singapore 40.9
China 35.6
7/29/2019 Evolution of Vietnamese Retail
http://slidepdf.com/reader/full/evolution-of-vietnamese-retail 4/20
4
• The Gini Index measures the extent to which the distribution of income among individuals or households within aneconomy deviates from a perfectly equal distribution.
• Hong Kong and Singapore show a wide gap between the wealthy and the poor. Japan, Taiwan and Korea show the mosteven distribution of income.
Real Economy – Gini Coefficient
Gini Index, 2007-2011
Rank* Gini Coefficiant (%) 2007 2008 2009 2010 2011
108 Philippines 46.10 44.50 44.50 44.00 44.00
104 Hong Kong 43.40 43.40 43.40 43.40 43.40
97 Thailand 43.20 42.00 42.00 42.50 42.50
96 Singapore 42.50 42.50 42.50 42.50 42.50
91 China 44.70 46.90 46.90 41.50 41.50
86 United States 40.80 40.80 40.80 40.80 40.80
71 Malaysia 49.20 49.20 49.20 37.90 37.90
70 Vietnam 37.00 34.40 34.40 37.80 37.80
67 Indonesia 34.30 34.30 34.30 39.40 37.60
58 United Kingdom 36.00 36.00 36.00 36.00 36.00
51 Australia 35.20 35.20 35.20 35.20 35.20
37 Taiwan 32.60 32.60 32.60 32.60 32.60
30 Korea 31.60 31.60 31.60 31.60 31.60
3 Japan 24.90 24.90 24.90 24.90 24.90*Rank out of 151 nations according to the United Nations development Index
Source: Human Development Index, UNDP
7/29/2019 Evolution of Vietnamese Retail
http://slidepdf.com/reader/full/evolution-of-vietnamese-retail 5/20
5
• With the exception of China and Indonesia, private consumption growth declined among Asian countries during therecession of 2008/09.
• Following the difficulties of 2009, almost all Asian economies rebounded significantly in 2010.
Real Economy – Private Consumption
Private consumption growth, 2005-2012F
-2%
0%
2%
4%
6%
8%
10%
12%
14%
2005 20 06 2007 2008 2009 2010 2011F 2012F
China Malaysia Indonesia Vietnam Philippines Thailand
-2%
0%
2%
4%
6%
8%
10%
12%
14%
2005 2006 2007 2008 2009 2010 2011F 2012F
Hong Kong Singapore Japan Korea Taiwan Australia
7/29/2019 Evolution of Vietnamese Retail
http://slidepdf.com/reader/full/evolution-of-vietnamese-retail 6/20
6
• With larger percentages of the Asia-Pac population using the internet awareness of international trends, brands andaccess to online stores will increase.
• Compared to the US & UK large numbers of Asia-Pac economies save more of their earnings. This offers opportunities topromote spending and domestic consumption within those markets.
Telecommunications & Savings
Internet & Mobile Phone Penetration 2009
20
40
60
80
100
120
140
160
180
200
0
10
20
30
40
50
60
70
80
90
Per 100 Pop% of Pop
Internet Penetration (LHS) Facebook Penetration (LHS) Mobile Phone Subscribers (RHS)
0
10
20
30
40
50
60
70
80
90
100
0
150
300
450
600
750
900
1050
1200
1350
% of GDPMillions
Population (LHS) Gross Savings 2009 (RHS)
Population & Savings 2009
Note: No Taiwan Data
Source: World Bank national accounts data, and OECD National Accounts data files.Source: Internet World Stats & International Telecommunications Union
7/29/2019 Evolution of Vietnamese Retail
http://slidepdf.com/reader/full/evolution-of-vietnamese-retail 7/20
Urbanisation is increasingin Southeast Asia
Urbanisation Ratio, 2010 – 2020E
0%
10%
20%
30%
40%
50%
60%
70%
80%
90%
100%
C hi na Ho ng
Kong
Taiwan Japan Korea Singapore Malaysia Phi l ippinesIndonesia Thai land Vietnam India Austral ia United
Kingdom
United
States
2010 2015 F 2020 F
Source: United Nations
Urbanization
7/29/2019 Evolution of Vietnamese Retail
http://slidepdf.com/reader/full/evolution-of-vietnamese-retail 8/20
1960 1965 1970 1975 1980 1985 1990 1995 2000 2005 2010 2015 2020 2025 2030 2035 2040 2045 2050
China
Hong Kong
Japan
Korea
Singapore
Malaysia
Philippines
Indonesia
Thailand
Vietnam
India
Australia
NewZealand
Source: United Nations
Demographic Window in Asia Pacific, 1960 - 2050
Demographic Trends Are Not Always Favorable
7/29/2019 Evolution of Vietnamese Retail
http://slidepdf.com/reader/full/evolution-of-vietnamese-retail 9/209
• Fast Fashion - Zara is committed very heavily to the markets within which it has a presence. Meanwhile H&M has focusedheavily on China, Hong Kong and Japan.
• Lacoste has a very large presence across the surveyed cities although this mainly due to smaller retail areas withindepartment stores (concessions). Lacoste goods are available in Taiwan through a franchise.
• Luxury Retail – With regard to Gucci and Louis Vuitton, Hong Kong, Tokyo and Seoul have a larger number of storescompared with other cities in the region.
Retail Sales Value
Fast fashion, mid-range and luxury brands –
number of stores by city, 2011
7/29/2019 Evolution of Vietnamese Retail
http://slidepdf.com/reader/full/evolution-of-vietnamese-retail 10/20
Population
of 6.9
Million
Population
of 6 Million
Bangkok, ThailandKlang Valley
Kuala Lumpur, Malaysia
From 2011 onwards: nearly 824,000 sqm of new supply
planned to enter the market
Retail density
Population
of 7.4
Million
Ho Chi Minh City, Vietnam
Location Sq m/person
HCMC 0.09
Bangkok 0.78
Jakarta 0.38
Kuala Lumpur 0.64
7/29/2019 Evolution of Vietnamese Retail
http://slidepdf.com/reader/full/evolution-of-vietnamese-retail 11/2011
• Rents for prime retail space in Hong Kong outstrip all other surveyed locations. They are now the most expensive in theworld second only to New York’s 5th Avenue.
• Shanghai commands the highest rents amongst the emerging economies.
Prime Retail Benchmark
Savills benchmark data based on top 5 prime retail malls in each city, 2008- 1H 2011
0
100
200
300
400
500
600
700
800
900
1000
1H 2H 1H 2H 1H 2H 1H 2H
2008 2009 2010 2011
US$ sq m gross
Hong Kong Singapore Taipei Tokyo Seoul Sydney
0
100
200
300
400
500
600
700
800
900
1000
1H 2H 1H 2H 1H 2H 1H 2H
2008 2009 2010 2011
US$ sq m gross
Beijing Shanghai Kuala Lumpur Jakarta Hanoi Ho Chi Minh
Note: figures inclusive of management fees and government
taxes
Source: Savills Research & ConsultancySource: Savills Research & Consultancy
7/29/2019 Evolution of Vietnamese Retail
http://slidepdf.com/reader/full/evolution-of-vietnamese-retail 12/2012
Cap Rates Around Asia Pacific
CitiesOffice Retail
1Q/2010 1Q/2011 1Q/2010 1Q/2011
Beijing 5.96% 5.66% NA NA
Shanghai 6.60% 5.50% 7.00% 6.50%
Hong Kong 3.10% 3.36% 3.76% 3.54%
Taipei 3.30% 2.80% 3.90% 3.10%
Tokyo 4.70% 4.80% 5.30% 5.20%
Seoul 5.90% 5.70% 7.00% 6.50%
Singapore 5.25% 3.88% 5.25% 4.75%
Kuala Lumpur 10.05% 10.11% 10.89% 11.61%
Hanoi 12.00% 12.00% 10.00% 10.00%
Ho Chi MinhCity
12.00% 12.00% 10.00% 10.00%
Sydney 7.25% 7.00% 6.50% 6.50%
7/29/2019 Evolution of Vietnamese Retail
http://slidepdf.com/reader/full/evolution-of-vietnamese-retail 13/2013
HCMC Snapshot
7/29/2019 Evolution of Vietnamese Retail
http://slidepdf.com/reader/full/evolution-of-vietnamese-retail 14/20
Retail supply
Retail podium
2%
Department store
17%
Shopping centre
40%
et
Wholesale centre
8%
CBD
23%
Secondary area
41%
Suburban area
36%
- 1 new retail centre with 5,000 sq m- Total supply: 630,000 sq m (stable q-o-q)
- 8 retail podiums, 7 department stores, 18 shopping centres, 57 supermarkets, 3
wholesale markets
7/29/2019 Evolution of Vietnamese Retail
http://slidepdf.com/reader/full/evolution-of-vietnamese-retail 15/2015
Future supply
•- 73,000 sq m to come in 2H/2011
•- 720,000 sq m to come in 2012- 2015
2012E 2013E 2014E 2015E Potential
Retail space 145,267 357,846 124,428 89,500 453,684
No.of projects 10 13 2 3 19
-
50,000
100,000
150,000
200,000
250,000
300,000
350,000
400,000
450,000
500,000
-
2
4
6
8
10
12
14
16
18
20No.of projectssq m
Retai l space No.of projects
District 7,38%
District 2,22%
District 1,12%
Others,28%
7/29/2019 Evolution of Vietnamese Retail
http://slidepdf.com/reader/full/evolution-of-vietnamese-retail 16/2016
Retail performance
•
Department stores had the best performance. •Avg. occupancy: 85% (-5% q-o-q)
•Avg. rent rate: US$65/sq m (-5% q-o-q)
•Only secondary areas had an increase in rent.
-8
-6
-4
-2
0
2
4
Retail podium Department
store
Shopping
centre
Occupancy Rent rate
% q-o-q change
-15
-10
-5
0
5
10
CBD Secondary
area
Suburban
area
Occupancy Rent rate
% q-o-q change
7/29/2019 Evolution of Vietnamese Retail
http://slidepdf.com/reader/full/evolution-of-vietnamese-retail 17/20
17
District7
District 5
TanBinh
Rental / volume guide
HCMCPeople’s
Committee
US$18 to US$45
US$20 toUS$180
US$18 toUS$50
US$20 to
US$200
7/29/2019 Evolution of Vietnamese Retail
http://slidepdf.com/reader/full/evolution-of-vietnamese-retail 18/20
The Crescent retail 90% leased
The Mall retail 70 % leased
GF & Upper levels mostly leased
2nd level some challenges
Phu My Hung Corp.
Location: Phu My Hung New City
Centre, Ho Chi Minh City
Retail Area: 45,000 sq. m net
7/29/2019 Evolution of Vietnamese Retail
http://slidepdf.com/reader/full/evolution-of-vietnamese-retail 19/20
7/29/2019 Evolution of Vietnamese Retail
http://slidepdf.com/reader/full/evolution-of-vietnamese-retail 20/20
Savills won Asia Pacific Property Awards 2011