Vietnam Quarterly Knowledge Report | Q1 2016

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VIETNAM QUARTERLY KNOWLEDGE REPORT Q1 2016

TABLE OF CONTENTS

ECONOMIC OVERVIEW...............................................................................................................

VIETNAM ....................................................................................................................................

HO CHI MINH CITY ......................................................................................................................

HA NOI ........................................................................................................................................

HO CHI MINH CITY MARKET OVERVIEW ........................................................................ OFFICE ........................................................................................................................................

RETAIL ........................................................................................................................................

CONDOMINIUM ............................................................................................................................

VILLA & TOWNHOUSE .................................................................................................................

SERVICED APARTMENT ..............................................................................................................

INDUSTRIAL ................................................................................................................................

HA NOI MARKET OVERVIEW ................................................................................................ OFFICE ........................................................................................................................................

RETAIL ........................................................................................................................................

CONDOMINIUM ............................................................................................................................

VILLA & TOWNHOUSE .................................................................................................................

SERVICED APARTMENT ..............................................................................................................

INDUSTRIAL ................................................................................................................................

Cover Page: Saigon Skyline

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LIST OF FIGURES Figure 1: Vietnam GDP .....................................................................................................................

Figure 2: Interest Rate and Exchange Rate of Vietnam ......................................................................

Figure 3: FDI Capital of HCMC and Hanoi ..........................................................................................

Figure 4: GDP Growth Rate of HCMC and Hanoi ................................................................................

HO CHI MINH CITY MARKET OVERVIEW Figure 5: Office, Net Absorption .........................................................................................................

Figure 6: Office, Occupancy Rate .......................................................................................................

Figure 7: Retail, Market Performance...................................................................................................

Figure 8: Retail, Average Asking Rent ................................................................................................

Figure 9: Retail, Supply by District ...................................................................................................

Figure 10: Condominium, Sold Units...................................................................................................

Figure 11: Condominium, Average Asking Rent by Segment ................................................................

Figure 12: Condominium, Q-o-Q and Y-o-Y Changes in Asking Price ..................................................

Figure 13: Villa and Townhouse, Supply by Year .................................................................................

Figure 14: Villa and Townhouse, Current Supply by District ................................................................

Figure 15 Villa and Townhouse, Changes in Asking Price.....................................................................

Figure 16: Serviced Apartment, Current Grade A&B Supply ................................................................

Figure 17: Serviced Apartment, Average Asking Rent by Grade ...........................................................

Figure 18: Industrial, Net Absorption ..................................................................................................

Figure 19: Industrial, Supply by District ..............................................................................................

LIST OF TABLES Table 1: Macroeconomic Indicators of HCMC and Hanoi ......................................................................

Table 2: Office, Future Supply ............................................................................................................

Table 3: Significant Office Projects ....................................................................................................

Table 4: Significant Retail Projects ....................................................................................................

Table 5: Condominium, Significant new Projects launched in Q1 2016 ................................................

Table 6: Villa and Townhouse, Significant new Projects launched in Q1 2016 ......................................

Table 7: Serviced Apartment, Significant Future Projects under construction ......................................

Table 8: Significant Serviced Apartment Projects ...............................................................................

Table 9: Industrial, Future Supply .......................................................................................................

Table 10: Industrial, Market Overview ................................................................................................

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LIST OF FIGURES

Figure 20: Office, Average Asking Rent...................................................................................................

Figure 21: Office, Occupancy Rate .........................................................................................................

Figure 22: Retail, Total Supply ...............................................................................................................

Figure 23: Retail, Occupancy Rate .........................................................................................................

Figure 24: Retail, Market Performance ...................................................................................................

Figure 25: Condominium, Launch Supply by Year ...................................................................................

Figure 26: Condominium, Sales by Quarter and Segment ........................................................................

Figure 27: Condominium, Changes in Secondary price by Quarter ..........................................................

Figure 28: Villa and Townhouse, Supply by Quarter ................................................................................

Figure 29: Villa and Townhouse, Secondary Price by District ..................................................................

Figure 30: Villa and Townhouse, Q-o-Q changes in Secondary Price .......................................................

Figure 31: Serviced Apartment, Total supply ...........................................................................................

Figure 32: Serviced Apartment, Occupanvy Rate by Grade ......................................................................

Figure 33: Serviced Apartment, Average Asking Rent by Grade ...............................................................

Figure 34: Industrial, Net Absorption ......................................................................................................

Figure 35: Industrial, Supply by District ..............................................................................................

LIST OF TABLES Table 11: Office, New Supply in Q1 2016 .................................................................................................

Table 12: Significant Office Projects ........................................................................................................

Table 13: Significant Retail Projects ........................................................................................................

Table 14: Condominium, New Projects Launched in Q1 2016 ....................................................................

Table 15: Villa and Townhouse, New Projects Launched in Q1 2016 .........................................................

Table 16: Significant Serviced Apartment Projects ..................................................................................

Table 17: Industrial, Future Supply ..........................................................................................................

Table 18: Hanoi Industrial Market Overview .............................................................................................

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HA NOI MARKET OVERVIEW

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GDPVietnam’s GDP has grown 5.46% in Q1 2016. This was a noticeable reduction from a rate of 6.12% in Q1 2015 but still higher than GDP growth rate of the same periods in 2012, 2013 and 2014. The three main compositions of the GDP which are agriculture–forestry-fishery, industry-construction and services had growth rates of -1.23%, 6.72% and 6.13% y-o-y respectively. Financial, banking and insurance sectors increased slightly over the same period, reaching 5.99%. Real estate trading rose 3.43% y-o-y which achieved the highest growth rate from 2012 to date.

CPIIn Q1 2016, the Consumer Price Index (CPI) increased 1.25% y-o-y while the core CPI grew 1.76% y-o-y. Factors that contributed to the increase in CPI in Q1 2016 were an upward in energy prices on the world market and the El Nino’s impact in Vietnam which cut down the supply and inflated up the price of livestock and agricultural products such as rice or sugarcanes.An increase in health care fees scheduled in July 2016 and school fees scheduled in September 2016 would expectedly push the CPI to increase even higher in the coming quarters.

FDIAs of 20th March, there have been about 473 new foreign investment projects in Vietnam with total registered investment worth USD2.74 billion, an increase of 125.2% y-o-y. In addition, 203 other projects registered to increase its investment by USD1.285 billion, an increase of 107% compared to the same period last year. In total, foreign investment in the first quarter of 2016 reached USD4.02 billion, up 119.1% compared to Q1-2015. Disbursement from FDI projects also grew 14.8% over last year’s period with USD3.5 billion were paid out.

RETAIL SALES Vietnam’s retail sales of goods and services in Q1 2016 achieved USD38.2 billion, a 0.99% increase compared to Q4-2015 and 9.1% y-o-y growth (or 7.9% y-o-y growth if price increase is excluded). The proportions of four main compositions are as follows: retail sales 76.4%, accommodation and catering services 11.3%, travel 0.8% and other services 11.5%. The four sectors all witnessed significant growths compared to last year’s periods, which were 9.2%, 8.5%, 8.8% and 8.9% y-o-y respectively.

INTERNATIONAL ARRIVALS The number of international visitors to Vietnam in Q1 2016 reached 2.459 million, 19.9% increase y-o-y. China and Korea were the two countries which accounted for highest number of visitors to Vietnam in the review period with 580,000 and 408,100 visitors respectively.

EXCHANGE RATEIn contrast to the intense volatility in 2015, the exchange rate USD/VND in the first quarter of 2016 was relatively calm. The exchange rate did not increase as many predicted in 2015, but decreased slightly from VND22,500 to around VND22,382 VND per USD1. The stability of the exchange rate in recent months has been partly contributed by favorable condition on the international financial market.According to forecasts of the International Monetary Fund (IMF), world economic growth trends have been slowed and this would further contribute to the slowing of the Fed’s rate hikes in the coming months. In the next quarters, if the dollar does not rise sharply and the Yuan is not significantly devalued, pressure on the exchange rate USD/USD in 2016 should not be too big.

Q1 2016 | ECONOMIC OVERVIEW

©2016 Colliers International Research

VIETNAM QUARTERLY KNOWLEDGE REPORT

Q2 2016 forecast

Figure 1: Vietnam GDP

Source: World Bank | Colliers International Research

Figure 2: Interest rate and Exchage rate of Vietnam

Source: Asian Development Bank (ADB) | Colliers International Research

VIETNAM

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Figure 4: GDP Growth Rate of HCMC and Hanoi

Source: General Statistics Office | Colliers International Research


Table 1: Marcoeconomic Indicators of HCMC and Hanoi

HCMC Hanoi

Q1 2016 Q2 2016F Q1 2016 Q2 2016F

GDP (billion) 9.86 5.33

FDI (million) 275.3 269.6

Retail sales (billion) 7.78 5.29

Export (billion) 6.69 2.56

Import (billion) 7.87 5.72

HO CHI MINH CITYThe Gross Regional Domestic Product (GRDP) of Q1 2016 achieved USD9.9 billion, an increase of 7.1% y-o-y. In more detail, the services sector had the highest growth rate of 7.8%, reaching USD5.7 billion. The industrial and construction sector came second with a growth rate of 6.25%, equivalent to USD2.7 billion. The agriculture-forestry-fishery sector achieved USD79 million, up 5.8% y-o-y.Total newly registered and supplementary FDI reached USD275.3 million. There are 147 new projects worth of USD190.3 million and 36 supplementary projects worth of USD 85 million. The amount of FDI of Q1 2016 significantly decreased, equivalent to 18.5% q-o-q and 49.5% y-o-y. This is a downside for HCMC as in the same period Vietnam witnessed an increase of 125.2% y-o-y in FDI. Three nations with the highest new capital investments are Japan, Singapore and Korea, accounting for 34.4%, 22.3% and 7% of the FDI respectively. Total retail sales of consumer goods and services reached USD7.8 billion, up 11.6% y-o-y. The four compositions, namely retail sales, accommodation & catering, travelling services and other services, accounted for 79.2%, 12.1%, 2.4% and 6.4% of the total sales of goods consequentially. Compared to the same period last year, travelling services had the highest growth rate of 14.4% while accommodation and catering had a slowest growth rate of 6.8%.Consumer Price Index (CPI) had a growth rate of -0.03%, 0.05% and 0.09% from January to March subsequently which pushed the CPI of Q1 2016 to 0.11%. Export values were USD 6.688 billion, equivalent to an increase of 0.1% q-o-q. Import values were USD7.873 billion equivalent to a growth of 8.2% y-o-y. In the previous quarter, the values of export and import were USD363 million and USD417.8 million respectively.

HANOIThe GRDP in Q1-2016 achieved USD5.3 billion which was equivalent to a rise of 6.95% y-o-y. Industrial & construction sector had the highest growth rate of 7.54% which was followed by growth rate of 7.05% y-o-y of services sector. In contrast, Agricultural-forestry-fishery industry suffered a negative growth rate of -0.69% y-o-y.The CPI in January and February climbed to 0.12% and 0.47% m-o-m. The Statistical Office of Hanoi did not publish CPI for March but it was reported to be slightly increased from February level. Compared with the previous quarter, the CPI of the Q1 2016 would be much higher due to increases in prices of energy and agricultural products.The city attracted USD269.6 million of new and supplementary FDI capital in the first quarter of 2016. Total retail sales of consumer goods and services extended 9% y-o-y to achieve USD5.3 billion. Compared with the previous quarter, this was a drop of 11.5%.Export values went up 2.3% y-o-y to achieve USD2.558 billion. Import values were USD5.715 billion which experienced a moderate reduction of -2% y-o-y. This brought about a trade deficit of USD3.157 billion in the review quarter. In Q1 2016, the capital city welcomed 761,000 tourists. This was a remarkable uptrend of 28.7% y-o-y.

Figure 3: FDI Capital of HCMC and Hanoi


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Figure 6: Office, Occupancy Rate

PERFORMANCERental growth across all grades was recorded in the review quarter. Grade A’s average net asking rents increased 1.92% q-o-q, staying at USD40.5/sqm/month while those of Grade B surged 5.1% q-o-q, reaching USD22.07/sqm/month.

Average occupancy rate witnessed downward trend over the quarter but maintained at a high rate of 93.4%. Grade A and Grade B’s occupied rate were 92.3% and 94.8%, down 3.1% and 1.86% q-o-q respectively.

SUPPLYNo new office building entered the market in the first quarter of 2016. The supply pipeline remained stable with 11 Grade A and 57 Grade B office buildings, providing approximately 1,331,347 sqm GFA.Grade B will domininate new supply in the next quarters with nearly 77,000sqm NLA from 4 projects. Despite having no additional buildings this year, Grade A stock will grow substantially in the next two years. By the end of 2018, the market is expected to welcome 4 more Grade A office buildings which are Deutsches Haus, Saigon Centre (Phase 2), Saigon One Tower and The One, providing nearly 172,859sqm NLA.

DEMANDAs a result of stronger FDI inflow to the city, the growing number of foreign enterprises will continue to drive office demand. This type of tenants would have distinctive enquiries such as green buildings with good access to natural light and energy efficiency, contiguous floor plates of larger than 1,000 sqm, prime locations with accessibility to public transport and staff amenity or close proximity to clients and brand profile. Landlords should be strategic to statisfy sophisticated leasing requirements from clients.

OUTLOOKAs there is a current drought of premium office stock, landlords are gaining confidence in offering higher rents and pushing back incentives. High quality assets are expected to achieve a rent growth up to 10%.

With prime locations and in close proximity of traffic hubs, CBD office buildings continue to be highly sought-after. Decentralised districts with well-established infrastructure and traffic system such as District 7 and Thu Thiem new urban area will become alternative options for tenants looking for large contiguous floor plates.

Q1 2016 | HO CHI MINH CITY | OFFICE



Table 2: Office, Future Supply

Source: Colliers International Research



Figure 5: Office, Net Absorption

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Hai Quan Tower A 30,000 2016

SGGP Building B 16,940 2016

HQC Royal Tower B 22,500 2016

Deutsches Haus A 24,900 2017

Saigon Center Phase 2 A 40,000 2017

Mapletree Business Center B 30,000 2017

E-Town Central B 34,000 2017

Q1 2016 | HO CHI MINH CITY | OFFICE



(*) US$/sqm/month (NLA)

Table 3: Significant Office Projects

No Name Address Completion Year

NLA (sqm)

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Occupancy rate

Average asking rent

(**)1 Saigon Centre 65 Le Loi 1996 11,650 9.0 99% 45.0

2 Saigon Tower 29 Le Duan 1997 13,950 8.0 99% 46.03 Sunwah Tower 115 Nguyen Hue 1997 20,800 8.0 98% 48.04 The Metropolitan 235 Dong Khoi 1997 15,200 8.0 90% 47.05 Diamond Plaza 34 Le Duan 1999 15,936 8.0 77% 45.06 Kumho Asiana Plaza 39 Le Duan 2009 26,000 8.0 89% 43.0

7 Bitexco Financial Tower 45 Ngo Duc Ke 2010 37,710 8.0 96% 34.08 President Place 93 Nguyen Du 2012 8,330 7.0 98% 42.0

9 Times Square 22-36 Nguyen Hue 2012 12,704 7.0 72% 40.010 Le Meridien 3C Ton Duc Thang 2013 9,125 6.0 94% 29.011 Vietcombank Tower 5 Me Linh Square 2015 41,250 7.0 95% 37.0

Grade A 212,655 7.7 92.3% 40.5

1 VTP-OSIC 8 Nguyen Hue 1993 6,500 6.5 98% 25.02 Yo Co Building 41 Nguyen Thi Minh Khai 1995 5,000 3.0 100% 23.03 Somerset Chancellor Court 21-23 NguyenThi Minh Khai 1996 3,200 5.0 100% 22.0

4 Central Plaza 17 Le Duan 1997 6,094 6.5 93% 24.0

5 Harbour View Tower 35 Nguyen Hue 1997 8,000 5.0 77% 20.06 Saigon Riverside Office 2A-4A Ton Duc Thang 1997 10,000 5.0 100% 28.07 Saigon Trade Center 37 Ton Duc Thang 1997 31,416 6.5 71% 24.0

8 MeLinh Point Tower 2 Ngo Duc Ke 1999 17,600 6.0 99% 27.09 Zen Plaza 54-56 Nguyen Trai 2001 11,037 7.0 86% 29.010 Bitexco Building 19-25 Nguyen Hue 2003 6,000 6.0 92% 27.011 The Landmark 5B Ton Duc Thang 2005 8,000 8.0 100% 27.012 Opera View 161-167 Dong Khoi 2006 3,100 7.0 100% 27.013 City Light 45 Vo Thi Sau 2007 10,000 5.0 100% 19.014 Petro Tower 1-5 Le Duan 2007 13,304 9.0 94% 35.015 The Lancaster 22 – 22 Bis Le Thanh Ton 2007 7,000 5.0 90% 25.016 CJ Building 5 Le Thanh Ton 2008 14,000 8.0 97% 29.017 Continential Tower 81-85 Ham Nghi 2008 15,000 6.0 98% 22.018 Havana Tower 132 Ham Nghi 2008 7,326 8.0 81% 31.0

19 Royal Center 235 Nguyen Van Cu 2008 14,320 6.0 100% 23.020 Sailing Tower 51 Nguyen Thi Minh Khai 2008 16,910 6.0 100% 26.0

21 TMS 172 Hai Ba Trung 2009 4,000 4.0 100% 24.022 A&B Tower 76 Le Lai 2010 17,120 6.0 95% 29.023 Bao Viet Tower 233 Dong Khoi 2010 10,650 5.0 100% 22.024 Green Power Tower 35 Ton Duc Thang 2010 15,600 6.0 99% 25.025 Maritime Bank Tower 192 Nguyen Cong Tru 2010 19,596 5.0 84% 22.026 Saigon Royal 91 Pasteur 2010 5,340 6.0 100% 23.027 Vincom Center 68 -70 -72 Le Thanh Ton 2010 56,600 7.0 94% 32.028 Empress Tower 138 Hai Ba Trung 2012 19,538 6.0 100% 30.029 Lim Tower 9-11 Ton Duc Thang 2013 22,000 6.0 99% 28.030 MB Sunny Tower 259 Tran Hung Dao, Co Giang 2013 13,200 6.0 99% 23.031 Lim Tower 2 Vo Van Tan 2015 8,400 5.5 100% 24.0

Grade B 405,851 6.2 93.8% 26.6

Q1 2016 | HO CHI MINH CITY | OFFICE Q1 2016 | HO CHI MINH CITY | OFFICE



SAIGON SKYLINE REVIEW- CBD HCMC GRADE A OFFICE BUILDINGS

KUMHO ASIANA PLAZA39 Le Duan, District 1

26,000/1,402$ 43.00$ 8.00

DIAMOND PLAZA SAIGON34 Le Duan, District 1

15,936/2,200$ 45.00$ 8.00

LE MERIDIEN 3C Ton Duc Thang, District 1

9,125/NA$ 29.00$6.00

SAIGON TOWER29 Le Duan, District 1

13,950/NA$ 46.00$ 8.00

DEUTSCHES HAUS3-5 Le Van Huu, District 1

THE METROPOLITAN235 Dong Khoi, District 1

15,200/1,000$ 47.00$ 8.00

PRESIDENT PLACE93 Nguyen Du, District 1

8,330/1,000$ 42.00$ 7.00

BITEXCO FINANCIAL TOWER45 Ngo Duc Ke, District 1

37,710/900-1,300$ 34.00$ 8.00

VIETCOMBANK TOWER5 Me Linh Square, District 1

41,250/NA$ 37.00$ 7.00

TIMES SQUARE SAIGON22-36 Nguyen Hue, District 1

12,704/1,450$ 40.00$ 7.00

SAIGON CENTRE65 Le Loi, District 1

11,650/ 1,073$ 45.00$ 9.00

SUNWAH TOWER115 Nguyen Hue, District 1

20,800/ 1,166$ 48.00$ 8.00

Q1 2016 | HO CHI MINH CITY | RETAIL



Figure 9: Retail, Total supply

PERFORMANCELower rental rate in suburban areas resulted in a drop of 2% q-o-q and 10% y-o-y in the average net asking rent across all segments. Department stores and retail podiums maintained their rents while shopping centers was down 3% q-o-q in rents, averaging at USD44/sqm/month.

Average occupancy rate decreased 1.5% q-o-q, staying at 91.6% as some newly-opened retail projects have not fill up their vacant space.

SUPPLYThree new shopping centers in suburban area have come online The retail stock increased 65,400sqm NLA with the opening of two new shopping centers in suburban districts.

Vingroup has made all efforts to expand their retail network in every district in Ho Chi Minh City. While Vincom Le Van Viet marks Vingroup’s first presence in District 9, Vincom Plaza Go Vap is their second retail project in the highly-populated Go Vap District. To date, they have owned 6 retail properties across the city, providing more than 200,000sqm NLA.

DEMANDFood and beverage (F&B) tenants is expected to be the main driver that will support the performance of HCMC’s retail market in the short to medium term.

McDonald, Starbucks, Subway, KFC and Burger King are a few international names that are growing their empires in the local market. These retailers tend to sercure prime locations in a retail center to easily catch the eyes of customers and lower the chance of their competitors.

OUTLOOKThe supply pipeline of shopping malls will grow bigger when Saigon Center Phase II and Aeon Mall Binh Tan will come online in the next quarters of 2016. The two new shopping centers will bring more foreign brands to the local market, creating intense competition between Vietnam and international retailers. Given abundant new supply, low quality retail properties need to be repositioning to avoid downtrend in rents and occupancy rates.

Figure 8: Retail, Average Asking rent



Figure 7: Retail, Market performance


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Table 4: Significant Retail Projects

No Name of Project/Building Address Location Completion Year

NLA (sq m) ARR (*) Occupancy

Rate1 Hotel Continental Sai Gon 132-134 Dong Khoi District 1 2000 200 90 100.0%2 Caravelle Hotel 19 Lam Son Square District 1 2000 150 220 100.0%3 New World Hotel 76 Le Lai District 1 2000 1,000 60 100.0%4 Sheraton Saigon 88 Dong Khoi District 1 2002 750 200 100.0%5 Opera View Lam Son Square District 1 2006 1,260 200 100.0%6 The Manor 1 91 Nguyen Huu Canh Binh Thanh 2006 2,000 14 83.0%7 Saigon Pearl 92 Nguyen Huu Canh Binh Thanh 2009 5,000 25 100.0%8 Rex Arcade 141 Nguyen Hue District 1 2010 2,000 120 100.0%

9 The Manor 2 91 Nguyen Huu Canh Binh Thanh 2010 2,500 13 92.0%

10 Bitexco Financial Tower 45 Ngo Duc Ke District 1 2011 8,000 55 95.0%11 The Vista Walk Hanoi Highway District 2 2012 10,000 13 80.0%

12 President Place 93 Nguyen Du District 1 2012 800 60 100.0%

13 Times Square 22-36 Nguyen Hue District 1 2012 9,000 300 97.0%14 Saigon Airport Plaza 1 Bach Dang Tan Binh 2013 7,623 15 100.0%

Retail Podium 50,283 87 94.0%

1 Zen Plaza 54-56 Nguyen Trai District 1 2001 6,817 58 100.0%2 Parkson Hung Vuong Plaza 126 Hung Vuong District 5 2007 24,000 60 99.0%3 Kumho Asiana Plaza 35 Le Duan District 1 2009 6,830 60 100.0%4 Parkson Flemington 184 Le Dai Hanh District 11 2009 26,000 25 90.0%5 Parkson Paragon 3 Nguyen Luong Bang District 7 2011 7,500 40 90.0%6 Parkson C.T Plaza 60A Truong Son Tan Binh 2012 12,235 21 95.0%7 Parkson Cantavil Premier Hanoi Highway District 2 2013 17,815 38 97%8 Taka Plaza 102 Nam Ky Khoi Nghia District 1 2011 1,000 70 70.0%

Department Store 102,197 41.0 95.0%

1 Diamond Plaza 34 Le Duan District 1 1999 9,000 90 100.0%2 Parkson Saigontourist Plaza 35 Le Thanh Ton District 1 2002 17,000 90 99.0%3 Saigon Center 35 Nam Ky Khoi Nghia District 1 1996 Renovation Renovation Renovation4 City Plaza 102 Nam Ky Khoi Nghia District 1 2000 Renovation Renovation Renovation5 Superbowl Vietnam TSN 38 Nguyen Hue Tan Binh 2002 5,500 20 98.0%7 An Dong Plaza 18 An Duong Vuong District 5 2004 18,000 40 99.0%8 Saigon Square 1 77-89 Nam Ky Khoi Nghia District 1 2006 1,300 167 100.0%9 Nowzone 235 Nguyen Van Cu District 1 2008 9,000 55 100.0%10 Lotte Mart Saigon South 469 Nguyen Huu Tho District 7 2008 24,000 50 100.0%12 Vincom Center B 72 Le Thanh Ton District 1 2010 45,000 150 100.0%13 Maximark 3/2 Extention 3/2 Street District 10 2010 25,000 35 90.0%14 Lotte Mart Phu Tho Le Dai Hanh District 11 2010 24,500 30 99.0%15 Crescent Mall Nguyen Van Linh District 7 2011 45,000 26 100.0%16 Satra Pham Hung Pham Hung District 8 2011 11,528 14 100.0%17 CMC Plaza 79B Ly Thuong Kiet Tan Binh 2011 Renovation Renovation Renovation18 Union Square Dong Khoi District 1 2012 38,000 300 New opening

Shopping Centre 272,828 96 99.0%

Accelerating success

Q1 2016 | HO CHI MINH CITY | CONDOMINIUM




Figure 12: Condominium, Q-o-q and Y-o-y changes in asking price

PERFORMANCEIn the first quarter of 2016, more than 9,000 units were sold across all segments, up 3.43% y-o-y. It is forecasted that throught out 2016, approximately 57,500 units will be available for sale.

High-end and mid-end segments account for more than 70% of the market share. Sale rate of mid-end segment grew 16% y-o-y while affordable segment declined 18.9% y-o-y. In the coming quarters, the market share of high-end segment will see more challenge from mid-end segment.

SUPPLYIn Q1-2016, it is estimated that 12,760 new units were launched for sale. Eastern and Southern areas account for majority of new units supplied.

Condominium market is expected to continually increase both in quantity and quality. Developers nowadays have to take part in intense competitions for potential buyers. Apart from prime location, high-end developers have come up with unique amenities and concept such as cruise habour, waterfall infinity pool, artificial sea or hanging gardens, while mid-end and affordable segments have competitively provided offers such as low construction density as well as associated public services such as internal parks, schools and sport centers.

DEMANDAcross all segments, buyers tend to be more selective in spending their money. Branding of a developer and its ability in assuring a project’s quality and progress are key factors considered by potential buyers.

Units with 1 or 2 bedrooms and price less than USD1,000/sqm are in excessive demand from end-users. Demand for affordable segment seems very high and is predicted to be grown steadily in the future.

OUTLOOKImproved infrastructure provides better connection between areas of the city as well as shorten the distance to the CBD. This helps to increase the demand and the price of projects in outer city areas. In addition, the new Law on Housing which permits foreigners to purchase up to 30% of the total number of apartments in a residential apartment project expects to boost sales further.

Nevertheless, condominium has one of the highest proportions of speculation among different segments of real estate market. It is therefore vulnerable to government policies and credit growth.


Figure 10: Condominium, Sold units



Figure 11: Condominium, Average asking price by segment

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10.0%

Primary market Secondary market

q-o-q changes y-o-y changes







Table 5: Condominium, Significant new projects launched in Q1 2016

No Name of Project/Building Developer Location Completion Year

Number of units

Asking Price (US$/sqm)

1 9 view Apartment Hung Thinh District 9 2018 690 7202 M-One Nam Saigon Thao Dien Investment District 7 2017 963 1,1003 Vinhomes Park Paroma VinGroup Binh Thanh 2017 430 1,9004 Opal Riverside Dat Xanh Group Thu Duc 2017 626 9705 Dat Gia Residence Dat Gia Real Estate Thu Duc 2017 1,034 8006 Vinhomes Golden River Bason VinGroup District 1 2018 3,000 4,000-5,0007 Vinhomes Central Park - P7 VinGroup Binh Thanh 2017 893 1,600-1,8008 Samland Riverside Sacomreal Binh Thanh 2018 138 1,3009 Sunriver Usilk TGT District 7 2017 136 1,10010 De Capella Quoc Cuong Gia Lai District 2 2018 380 1,40011 The Avila Thai Bao District 8 2017 285 70012 Xi Grand Court Phu Son Thuan District 10 2017 748 1,40013 Kris Vue CapitaLand District 2 2018 128 1,30014 Viva Riverside Vietcomreal District 6 2018 567 1,20015 Scenic Valley 2 Phu My Hung District 7 2017 248 1,50016 Luxury Home Sacomreal District 7 2018 250 1,00017 Top Life TIEXIM District 10 2018 84 2,20018 Sarina Dai Quang Minh District 2 2016 233 1,75019 Madison NovaLand District 1 2018 109 5,000-6,000

20 Hung Phat Golden Star Hung Loc Phat District 7 2018 478 1,300

21 I-Home Xa Lo Ha Noi C.T Group District 9 2017 431 70022 Botanica Premier NovaLand Tan Binh 2018 909 1,600

New launches in Q1 2016 12,760

* Excluding all kinds of tax, promotions and management feeThe information is updated as at the end of Q1 2016


Q1 2016 | HO CHI MINH CITY | VILLA & TOWNHOUSE



PERFORMANCEThe villa and townhouse segment performed well in Q1 2016 thanks to a warming property market and stable macroeconomic factors. Prices continued to go up an average 1-2% q-o-q.

The transaction volume went down 24% q-o-q due to a shortage in supply of affordable segment.

SUPPLYFour notable projects offered 486 new villas and townhouses to the market.

Future supply is expected to grow strongest in Eastern and Souther areas of HCMC this year while the western area has high potential to develop in the longer term.

DEMANDHo Chi Minh City is home of three million immigrants. The city also welcomes 50,000 newly married couples every year. Certain proportions of these people might want to settle in the city in their own house and would become potential clients of villa and townhouse market. Hence, the demand for the market is maintained high and stable over years.

For mid-end and high-end segments, buyers prefer projects with well-developed infrastructure, good traffic system and transparent legal status. Similar to condominium market, low-priced, small area houses in suburban seem to have highest demand from the market.

OUTLOOKFree trade agreements such as the TPP would bring about an inflow of foreign investors, specialists, management teams to Ho Chi Minh City. This, accompanied with the new Housing Law which permits foreigners to purchase up 250 separate houses in a project where the population is equivalent to a ward, would expect to increase the demand for villas and townhouses.

Districts 2 and District 9 in the East, District 7 and Nha Be in the South are forecasted to continue to dominate the market while the Western area have high potential to grow in the future.

Figure 13: Villa and Townhouse, Supply by Year


Figure 14: Villa and Townhouse, Current Supply by District


Figure 15: Villa&Townhouse, Changes in asking price


0.0%

1.0%

2.0%

3.0%

4.0%

5.0%

Primary market Secondary market

q-o-q changes y-o-y changes

0

200

400

600

800

Dist. 9 Dist. 2 GoVap

NhaBe

Dist. 7 BinhThanh

ThuDuc

Dist.12

BinhTan

BinhChanh

dwel

lings

No. of townhouses No. of villas

0

1000

2000

3000

4000

5000

6000

7000

8000

2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 Q12016

Existing supply New supplyunits







Table 6: Villa and Townhouse, Significant new projects launched in Q1 2016


Number of units


1 The Manera Khang Dien Tu Van Quoc Te District 9 N/A 54 1,8002 Saroma Villa Dai Quang Minh District 2 2016 177 N/A3 The Venica Khang Dien District 9 2016 43 500-1,5004 Camelia Gardern Nam Long Group Binh Chanh 2016 212 1,282-1,851

New launches in Q1 2016 486


Q1 2016 | HO CHI MINH CITY | SERVICED APARTMENT



PERFORMANCEGrade A’s average occupancy rate remained unchanged over the quarter, reaching 86.4%. The average gross asking rent recorded a drop of 2.61ppts q-o-q, staying at USD29.9/sqm/month.

Grade B had the best performance in the review quarter. Average occupancy rate increased to 88.2%, up 0.45ppts while rental rate saw an improvement of 1.35ppts, averaging at USD22.4/sqm/month.

SUPPLYThe existing stock was stable with approximately 4,100 units from 80 projects. Due to well-establised public facilities and amenities, the CBD is home of more than 40% of total serviced apartments.

New supply from now until end of 2017 will grow substantially with approximately 1,459 units. It is notable that five out of seven significant future projects is located in District 1 and District 3. To meet current demand from single tenants, the proportion of one-bedroom and two-bedroom units tend to be increased in newly launched developments.

DEMANDServiced apartments in the CBD are typically preferred by professional singles due to its close proximity to their workplace.

District 2 and District 7 are attractive for expatriate families as these two locations can provide large size accommodation together with social amenities such as international schools, hospitals, shopping malls, etc. It is observed that District 2 with peaceful riverside environment is popular for Westerners while District 7 is a hot spot for Asian community.

OUTLOOKDemand for serviced apartments will be strengthen in the long term after Vietnam joined Trans Pacific Partnership and Asean Economic Community, leading to the growing number of foreign workforce. Despite solid demand, this market segment have to compete with buy-to-let apartments and private houses where offering competitive rents for long-term stays.

To maintain healthy occupancy rates, landlords need to adjust rents and consolidate their services when new completions enter the market expatriates and MNCs.

Project name District Grade Total units

Expected Completion

Sila Urban Living 3 B 217 2Q 2016

Ascott Waterfront Saigon 1 A 222 3Q 2016

Saigon Plaza 1 B 119 4Q 2016

New Pearl 3 B 120 4Q 2016

Saigon South Place 7 A 480 2017

Saigon Center Phase 2 1 A 216 2017

Berkley Service Residence 2 B 85 2017

Table 7: Serviced apartment, Significant future projects under construction


Figure 16: Serviced Apartment, Current grade A&B supply


Figure 17: Serviced Apartment, Average asking rent by grade


0

1,000

2,000

3,000

4,000

2010 2011 2012 2013 2014 2015 Q1 2016

units

Grade A Grade B

15

20

25

30

35

2010 2011 2012 2013 2014 2015 Q1 2016

US$

/sqm

/mon

thGrade A Grade B







Table 8: Significant Serviced Apartment Projects

No. Project Name Address Location Completion Year

Total Room

Average Occupancy

ARR(*) (**)

1 The Landmark 5B Ton Duc Thang District 1 1995 66 95.0% 262 Sedona Suites 65 Le Loi District 1 1996 89 89.0% 30

3 Somerset Chancellor Court 21-23 Nguyen Thi Minh Khai District 1 1996 172 96.0% 34

4 Nguyen Du Park Villas 111 Nguyen Du District 1 2004 41 98.0% 305 The Lancaster 22-22 Bis Le Thanh Ton District 1 2007 55 73.0% 376 Intercontinental Asian Saigon 39 Le Duan District 1 2009 260 95.0% 36

Grade A 683 92.9% 33.5

1 Norfork Mansion 17-21 Ly Tu Trong District 1 1998 126 85.0% 262 Saigon Sky Garden 20 Le Thanh Ton District 1 1998 154 85.0% 263 Somerset HCM 8A Nguyen Binh Khiem District 1 1998 165 94.0% 264 Diamond Plaza 34 Le Duan District 1 1999 42 95.0% 295 Garden View Court 101 Nguyen Du District 1 2000 76 91.0% 316 Ben Thanh Luxury 172-174 Ky Con District 1 2010 88 91.0% 18

7 Lafayette De SaiGon 8 Phung Khac Khoan District 1 2010 18 89.0% 28

8 Vincom Center 45A Ly Tu Trong District 1 2010 60 34.0% 26

9 Nikko Saigon 235 Nguyen Van Cu District 1 2011 54 100.0% 30

10 Saigon City Residence 8A/3D2 Thai Van Lung District 1 2011 17 84.0% 23

11 Spring Court 1Bis Phung Khac Khoan District 1 2011 14 76.0% 23

Grade B 814 85.7% 25.9

(*) US/sqm/month(**) ARR (Average Rental Rate): All rents are stated in gross rents per sqm, not including VAT and serviced charge



Q1 2016 | HO CHI MINH CITY | INDUSTRIAL



PERFORMANCEIn Q1 2016, the average rent of industrial parks (IPs) in HCM City was USD122/sqm/term and the average land use right term was 35.7 years. IPs in Cu Chi district have the lowest rents, averaging at USD50-USD60/sqm/term. On the contrary, IPs in Tan Binh District and District 7 have highest asking rents of, up to USD220-USD270/sqm/term. In general, rents in HCMC are currently more than double compared to those in the Southern Key Economic Region such as Binh Duong, Dong Nai, Long An, Vung Tau. The average occupancy rate was 68%, stable over the quarter. About two-thirds of IPs enjoyed above 90% occupancy rates due to its convenient location and efficient services. Common offers for ready-built factories were USD2.5-USD4/sqm/month (exclusive of VAT and service charge) with a minimum area from 1,000-5,000sqm.

SUPPLYIn the first three months of 2016, there is no new supply of IPS. The total areas of IPs in HCMC are over 3,900ha of which the leasable areas are over 2,700ha. By 2020, the total supply of industrial zones is estimated to rise to above 6,500 ha, up to 67% compared to the current supply. However, there is an uncertainty on the construction progress of some industrial parks.

DEMANDInflows of Foreign direct investment (FDI) to Export Processing Zones (EPZs) and industrial parks (IPs) in Ho Chi Minh City plummeted 69.5% year-on-year to USD116 million in the first three months of 2016.As of the end of March 2016, domestic and foreign firms registered to invest in 1,390 projects with accumulated capital of USD9.17 billion in HCM City’ EZs and IPs of which foreign-owned-enterprises accounted for 554 projects and USD5.42 billion.Meanwhile, domestic companies pledged to invest nearly USD80.4 million in EZs and IPs in the first quarter of 2016, representing an 80% y-o-y increase.Companies from non-TPP member nations such as China, Korea, India would relocate their operations and factories to Vietnam in order to benefit from tax incentives for their products. Foreign investors, especially from the U.S and Japan, will also flow into Vietnam more heavily to take advantage of Vietnam’s abundant labor force and a 90-million consumers market. These factors positively contribute to the demand for industrial real estates.

OUTLOOKRents and occupancy rates are likely to go up in the coming quarters as the inflows of FDI and the expansion of production in preparation for the TPP and other FTAs are expected to continue.The number of industrial areas is still being expanded. However, the majority of future projects are in the process of site clearance and compensation and hence construction process is expected to be prolonged. Le Minh Xuan 2, Le Minh Xuan 3, Vinh Loc 3, Hiep Phuoc phase 2 are among those that are on track to be in operation soon.



Figure 18: Industrial, Net absorption


Figure 19: Industrial, Supply by District



Table 9: Industrial, Future Supply

Industrial Park Name District GFA (ha)

Le Minh Xuan Industrial Park - phase 3 Binh Chanh 242

Tay Bac Cu Chi Industrial Park - phase 2 Cu Chi 173

Hiep Phuoc Industrial Park - phase 2 Nha Be 597

0

10

20

30

40

50

60

70

80


2012 2013 2014 2015 2016

ha

Dist. 922%

Cu Chi23%

Binh Chanh16%

Binh Tan10%

Dist. 78%

Nha Be8%

Others13%






Table 3: Significant Office ProjectsTable 10: HCMC Industrial Market Overview

No Name of Industrial Park Location Distance to CBD (km)

Total Area(ha)

Total leasable area (ha)

Asking Rent (US$/sqm/

term)Occupancy LUR Term

1 Linh Trung 1 Export Processing Zone Thu Duc 18 62 46 60 100% 20422 Linh Trung 2 Export Processing Zone Thu Duc 17 62 44 60 99% 20503 Binh Chieu Industrial Park Thu Duc 16 27 27 150 100% 20464 Saigon Hi-tech Park P1 District 9 15 300 300 60 100% 20525 Tay Bac Cu Chi Industrial Park Cu Chi 36.5 208 150 90 99% 20476 Tan Thoi Hiep Industrial Park District 12 16 28 20 100 100% 20497 Tan Phu Trung Industrial Park Cu Chi 37 543 359 73 28% 20548 Tan Thuan Export Processing Zone District 7 6.4 300 205 260 81% 20419 Hiep Phuoc Industrial Park 1 Nha Be 21 331 224 100 93% 204810 Hiep Phuoc Industrial Park 2 Nha Be 22 597 345 100 10% 205811 Tan Tao Industrial Park 1 Binh Tan 17 161 97 251 97% 204712 Tan Tao Industrial Park 2 Binh Tan 17 183 116 251 78% 205013 Tan Binh Industrial Park Tan Binh 11 129 100 235 100% 204714 Le Minh Xuan Industrial Park Binh Chanh 20 100 66 100 95% 204715 Vinh Loc Industrial Park Binh Chanh 15 203 131 270 95% 204716 Dong Nam Industrial Park Cu Chi 30 343 287 63 69% 205817 An Ha Industrial Park Binh Chanh 23 124 124 64 23% 205818 Cat Lai Industrial Park District 2 21 137 87 90 100% 206119 Automotive - Mechanical (Hoa Phu) Cu Chi 40 99 67 56 83% 2057

Total 3,937 2,795 122 68%


Q1 2016 | HA NOI | OFFICE



PERFORMANCEThe overall market experienced a downward trend in both rents and occupancy. Average occupancy across all grades dropped 1.82ppts over the quarter, staying at 86.4% while net asking rents were reduced to USD22.8/sqm/month on average, down 2.57ppts q-o-q.

Due to new supply entering the market, Grade A’s occupancy and rents decreased 5.98 ppts and 3.77ppts respectively compared to the previous quarter. In contrast, Grade B’s performance recorded improvements, reaching 91% in occupancy and USD17.65/sqm/month in average net asking rents.

SUPPLYThe supply pipeline grew significantly in the first quarter of 2016 with five new office completions, providing approximately 133,921 sqm NLA. There is only one Grade A project coming online while the other four are of Grade B standard.

From now until 2018, there is approximately 330,000sqm GFA of office space entering the market. Most of new supply will be decentralised in the West and Midtown area, creating intense competition with the existing CBD.

DEMANDExpansion and relocation are two key demand drivers of Hanoi office market. The city west is an ideal option for tenants looking to reduce operational costs while still securing high quality office space.

Due to an oversupply, the market has been favorable for occupiers, which enables them to negotiate for better terms and incentives.

OUTLOOKIt is forecasted that the overall market performance will continue to witness imbalance between supply and demand. With ample supply entering the market, vacancy is expected to be on the rise while rent will be on downward trend. To attract new tenants, landlords have to think of various marketing strategies and promotional incentives.

Figure 20: Office, Average Asking Rent


Figure 21: Office, Occupancy Rate


Table 11: Office, New Supply in Q1 2016


0%

20%

40%

60%

80%

100%


2012 2013 2014 2015 2016

Grade A Grade B

Project name District Grade NLA (sqm)

TNR Dong Da A 37,411

789 Hoang Quoc Viet Cau Giay B 39,419

Hadico Tu Liem B 19,091

Diamond Flower Tower Thanh Xuan B 18,000

MD Complex My Dinh Tu Liem B 20,000

0

5

10

15

20

25

30

35

40


2012 2013 2014 2015 2016

US

$/sq

m/m

onth

Grade A Grade B

Q1 2016 | HA NOI | OFFICE



(*) US$/sqm/month (NLA)

Table 12: Significant CBD Office Projects

No Name Address Completion Year

NLA (sqm)

Service Charges

(*)

Occupancy rate

Average asking rent

(**)1 Central Building 31 Hai Ba Trung 1995 3,653 - 100% 47

2 International Centre 17 Ngo Quyen 1995 6,500 7 90% 253 Hanoi Tower 49 Hai Ba Trung 1997 9,000 7 96.7% 284 63 Ly Thai To Building 63 Ly Thai To 1998 6,753 - 100% 475 Sun Red River Building 23 Phan Chu Trinh 1999 13,459 - 90.9% 386 Vietcombank Tower 198 Tran Quang Khai 2000 19,563 - 100% 29

7 Opera Business Centre 60 Ly Thai To 2007 3,787 included 85.1% 258 Pacific Palace 83B Ly Thuong Kiet 2007 16,600 7 66.1% 20

9 Asia Tower 2 Nha Tho 2007 3,100 included 76.7% 3510 Sun City Building 13 Hai Ba Trung 2007 6,400 - 100% 45

11 BIDV Tower 194 Tran Quang Khai 2010 10,120 - 95% 39

12 Sentinel Place Hang Da 2010 8,000 - 76% 35

13 Corner Stone 16 Phan Chu Trinh 2013 26,500 7 70% 30

14 Hong Ha Center 25 Ly Thuong Kiet 2013 11,000 5 27.3% 19

Grade A 144,435 81% 31

1 Tungshing Square 2 Ngo Quyen 1996 8,306 - 89% 202 Melia Hotel 44B Ly Thuong Kiet 1997 8,500 - 90% 38

3 Prime Centre 53 Quang Trung 1998 7,600 - 95.8% 27

4 VIB Hai Ba Trung 59 Quang Trung 2006 3,000 - 68% 165 Capital Tower 109 Tran Hung Dao 2010 21,089 7 93.3% 216 Hanoi Tourist Building 18 Ly Thuong Kiet 2010 7,600 - 100% 24

7 Capital Building 72 Tran Hung Dao 2013 5,800 - 86.2% 258 Coalimex Building 33 Trang Thi 2013 5,071 5 79.3% 139 VID Building 115 Tran Hung Dao 2013 4,930 - 88.6% 2310 Artex Port 31-33 Ngo Quyen 2014 4,725 - 100% 23

Grade B 76,621 91% 23.5


Q1 2016 | HA NOI | RETAIL



Table 3: Significant Office ProjectsPERFORMANCEOverall occupancy rate decreased 0.9ppts q-o-q, stabilizing at 88.5% due to weak business performance of some retail centers. The average net asking rents nominally increased 0.2ppts q-o-q. The CBD and non CBD sub-markets recorded large variances with rent, staying at USD81.44/sqm/month and USD28.89/sqm/month respectively

SUPPLYThe retail stock remained stable in the review quarter as no new project came online. Currently, Hanoi market has more than 600,000sqm NLA from 50 buildings.

In terms of retail format, shopping centers take the largest share in the supply pipeline, accounting for nearly 80% of the total net lettable area. The market share of department stores and retail podiums are 10% and 11% respectively.

By location, the CBD is home of 4% of total retail supply, providing a majority of small-scale podiums. The remaining supply is located in non-CBD districts, including large-scale shopping centers and department stores.

DEMANDVietnam’s young population and rising urban middle-class result in strong consumer-spending potentials. However, given relatively low average income across the nation, demand for affordable goods and services outweighs luxury branded products.

To achieve higher footfall in all retail developments, retailers should focus on selling mid-end items to customers.

OUTLOOKThe general outlook for Hanoi retail in the short term is continued oversupply, particularly those outside of the CBD. The market will become more competitive, resulting in pressure on both rents and occupancy rates. To attract more shoppers and satisfy their diversified demand, landlords should organize special marketing events and festivals in their retail centers.

Figure 22: Retail, Total Supply

Figure 24: Retail, Market Performance



Figure 23: Retail, Occupancy Rate


75

80

85

90

95

100

2011 2012 2013 2014 2015 2016

%

CBD Non-CBD

0

10

20

30

40

50

60

70

80

75%

80%

85%

90%

95%

100%

2008 2009 2010 2011 2012 2013 2014 2015 Q12016

US

$/sq

m/m

onth

Rental rate Occupancy

0

100,000

200,000

300,000

400,000

500,000

600,000

700,000

800,000

2010 2011 2012 2013 2014 2015 Q1 2016

sq m

CBD Non-CBD



Q1 2016 | HA NOI | RETAIL



Table 13: Significant Retail Projects

No Name of Project /Building Address Location Completion

YearNLA

(sq m) ARR (*) Occupancy Rate

1 Central Building 31 Hai Ba Trung Hoan Kiem 1995 550 85-100 100%2 Hanoi Tower 49 Hai Ba Trung Hoan Kiem 1997 2,056 43 73%3 63 Ly Thai To Building 63 Ly Thai To Hoan Kiem 1998 594 145-200 45%4 ICC Building 71 Nguyen Chi Thanh Dong Da 2006 2,900 40-50 100%5 Pacific Place 83b Ly Thuong Kiet Hoan Kiem 2007 2,000 45 90%6 Opera Business Center 6b Trang Tien Hoan Kiem 2007 1,070 90-150 100%7 Golden Westlake 151 Thuy Khue Tay Ho 2007 1,000 25-70 68%8 Sun City 13 Hai Ba Trung Hoan Kiem 2008 861 85-95 100%9 Asia Tower 6 Pho Nha Tho Hoan Kiem 2008 500 100-120 100%10 Sentinel Place 41A Ly Thai To Hoan Kiem 2010 550 49-85 -11 Sky City Tower 88 Lang Ha Dong Da 2010 5,400 20-80 100%12 Han Viet Tower 203 Minh Khai Hai Ba Trung 2012 600 20-31 50%13 Rainbow Tower 19/5 KDT Van Quan Ha Dong 2012 900 8-24 56%14 Hapumedicenter 85 Vu Trong Phung Thanh Xuan 2012 18,500 10-21 81%15 The Lancaster Hanoi 20 Nui Truc Ba Dinh 2013 3,123 25-45 100%16 Madarin Garden Residential 1 Hoang Minh Giam Cau Giay 2013 11,000 20-40 55%

Retail Podium 51,604 78%

1 Vincom Center Ba Trieu - Tower A&B 191 Ba Trieu Hai Ba Trung 2004 17,000 55 98%2 Vincom Center Ba Trieu - Tower C 191 Ba Trieu Hai Ba Trung 2004 10,974 18-100 100%3 Ruby Plaza 44 Le Ngoc Han Hai Ba Trung 2007 5,200 29 100%4 Syrena 51B Xuan Dieu Tay Ho 2008 5,000 23 96%5 Trang Tien Plaza 24 Hai Ba Trung Hoan Kiem 2008 14,000 10 85%6 Savico MegaMall 7-9 Nguyen Van Linh Long Bien 2011 54,900 18 68%7 Keangnam Palace Landmark Lot E6, Pham Hung Tu Liem 2011 60,771 20-53 80%8 Vincom Center Long Bien KDT Vincom Long Bien 2012 45,000 19 46%9 Indochina Plaza Hanoi 241 Xuan Thuy Cau Giay 2012 19,929 18 70%10 SapoMart Ha Dong 8 Quang Trung Ha Dong 2012 12,000 12-30 60%11 Ocean Mall 5 Hoang Dao Thuy Cau Giay 2013 10,000 10-30 100%12 Vincom Mega Mall - Royal City 72A Nguyen Trai Thanh Xuan 2013 230,000 30 92%13 Vincom Mega Mall - Time City 458 Minh Khai Hai Ba Trung 2014 200,000 27 92%14 Aeon Mall Long Bien 2 Co Linh Long Bien 2015 72.000 45 98%15 Vincom Nguyen Chi Thanh 54A Nguyen Chi Thanh Dong Da 2015 34,500 40 96%

Shopping Centre 719,346 86%

1 Parkson (Viet Tower) 198 Tay Son Dong Da 2007 15,761 28 85%2 The Garden (Bitexco) Me Tri Tu Liem 2007 23,700 25 58%3 Ho Guom Plaza Ha Dong Ha Dong 2013 23,380 16 75%4 Lotte Department Store 54 Lieu Giai Ba Dinh 2014 38,709 43 91%

Department Store 101,550 79%

(*) ARR (Average Rental Rate): All rents are stated in net rents per sqm, inclusive service charge but exculding VAT


Q1 2016 | HA NOI | CONDOMINIUM



PERFORMANCEThe review quarter recorded 3,980 successful transactions, down 34% compared to the previous quarter. Sales momentum continued to be strong in high-end and mid-end segments.

On the primary market, price growth of 2.9% q-o-q was recorded in the mid-end segment. Asking price was soften in high-end and low-end projects, a drop of 0.3% and 7.8% q-o-q respectively. Projects with convenient traffic & location, reputable developers and well-established facilities and amenities tend to increase their sale price.

SUPPLYNew supply was ample in Q1 2016 with approximately 4,479 units from 13 projects. Ha Dong, Tu Liem and West Lake are top three locations for new condominium developments during the review quarter.

With the ongoing establishment of new townships in sub-urban districts, Hanoi residential market will be abundant with more launches in coming quarters of 2016.

DEMANDAccording to Hanoi Statistics Office, the capital city’s population was 7.21 million in 2013. The number is expected to reach 8 million in 2020 and young population of less than 35 years old will account for 50%. This trend reflects strong potential for the apartment market.

In terms of size, small and medium apartments of 45-90sqm are sought after by owner-occupiers who having limited budgets.

OUTLOOKAs buyers and investors have regained their market confidence, demand for mid-end and high-end segment is expected to remain higher in the next quarters. Affordable units will achieve stable sales volume on the back of reasonable price and strong demand from end-users.

Figure 25: Condominium, Launch Supply by Year


Figure 26: Condominium, Sales by Quarter and Segment



Figure 27: Condominium, Changes in secondary prices by Quarter

-8

-6

-4

-2

0

2

4

6

8

2008 2009 2010 2011 2012 2013 2014 2015 2016

%

0

1,000

2,000

3,000

4,000

5,000

6,000

7,000


2012 2013 2014 2015 2016

units

Luxury High-end Mid-end Affordable

0

5000

10000

15000

20000

25000

30000

2007 2008 2009 2010 2011 2012 2013 2014 2015 Q12016

sqm






Table 3: Significant Office ProjectsTable 3: Significant Office Projects

* Excluding all kinds of tax, promotions and management feeThe information is updated as at the end of 2015

Table 14: Condominium, New projects launched in Q1 2016


Number of units


1 FLC Star Tower FLC Group Ha Dong 2017 235 900-9502 FLC Garden City FLC Group Tu Liem 2017 200 7003 Tu Hiep Plaza Vinh Hanh Group Thanh Tri 2017 300 6504 Gemek Premium Geleximco Hoai Duc 2017 200 670-7605 Tincom - Phap Van Tincom Group Thanh Tri 2017 600 7006 Ecolife Tay Ho Thu Do Invest Tay Ho 2017 200 1,3007 An Binh City Geleximco Cau Giay 2017 300 1,200

8 E4 Yen Hoa VTIC Cau Giay 2017 500 1,300

9 Vinata Tower Vinaconex - Taisei Cau Giay 2017 480 800

10 FLC Green Tower FLC Group My Dinh 2017 500 1,300-1,400

11 Sun Legacy Sungroup Tay Ho 2017 500 3,800

12 Star Tower Vietnam Construction& Investment - Design Thanh Xuan 2017 264 1,133

13 Ngoai Giao Doan Hancorp Tu Liem N/A 200 1,000-1,100

New launches in Q1 2016 4,479


Q1 2016 | HA NOI | VILLA & TOWNHOUSE



PERFORMANCETownhouses dominated sale transactions as 70% of launched dwellings were sold in the first quarter of 2016.

On the primary market, sale price remained stable. The average secondary price dropped 0.8% q-o-q for villas but increased 1.3% q-o-q for townhouses. By location, projects in decentralised districts witnessed higher sale price. Compared to the previous quarter, Ha Dong District recorded the highest price growth of 5.5% while Cau Giay and Hoai Duc district had positive price increases of under 5%.

SUPPLYThe stock increased 1.9% q-o-q in the first quarter of 2016 with the launch of five new projects, providing 859 dwellings. Due to large land availability, Ha Dong district takes the largest market share, representing 27% of supply pipeline. Well-established infrastructure and convenient traffic connection has attracted homebuyers to settle in this area.

DEMANDLanded properties are preferred by Vietnamese people as this type of accommodation is believed to increase value over time. Investors and end-users are key demand drivers of the market with purposes of rental income and owner occupation. Speculators who buy a property for capital appreciation account for a small proportion in the buyer profile.

Demand for landed houses is expected to become stronger on the back of high urbanization rate and rapid development of infrastructure in Hanoi.

OUTLOOKNext quarters of 2016 is expected to have 10 projects coming online and approximately 40 projects under planning stage. Some projects that have been delayed for a long time will be restarted to catch the new market cycle. Projects with reasonable price and good supporting infrastructure will potentially achieve stronger sales volume than others.

Figure 28: Villa and Townhouse, Supply by quarter


Figure 29: Villa and Townhouse, Secondary price by District



Figure 30: Villa and Townhouse, Q-o-Q changes in secondary price

-15

-10

-5

0

5

10

15

20

0

1000

2000

3000

4000

5000

6000

7000

Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1

2011 2012 2013 2014 2015 2016

%

US

D/s

qm

Market average price Q4 2015 Q-o-Q changes

0

20

40

60

80

100

120

140

160

180

200

ThanhXuan

CauGiay

Tay Ho Tu Liem HoangMai

HaDong

LongBien

ThanhTri

HoaiDuc

Gia LamMe Linh

USD/

sq m

Q4-2015 Average Q1-2016 Average Market average price Q4 2015

95

100

105

110

115

120

125

130

26,000

27,000

28,000

29,000

30,000

31,000

32,000

33,000

34,000

Q3 Q4 Q1 Q2 Q3 Q4 Q1

2014 2015 2016

dwel

lings

No. of Dwellings No. of Projects







Table 3: Significant Office ProjectsTable 3: Significant Office ProjectsTable 3: Significant Office Projects

* Excluding all kinds of tax, promotions and management feeThe information is updated as at the end of 2015

Table 15: Significant new projects launched in Q1 2016


Number of units


1 The Green Manor Geleximco Ha Dong 2018 300 670-9002 Vinhomes Gardenia VinGroup Tu Liem 2017 192 1,400-1,7003 MonCity Hai Dang Real Estate Corporation Tu Liem 2016 147 5,6004 The Phoenix Garden DIA Corporation Dan Phuong 2016 200 6005 Five Star My Dinh GFS Corporation Tu Liem 2016 20 900

New launches in Q1 2016 859


Q1 2016 | HA NOI | SERVICED APARTMENT



Table 3: Significant Office ProjectsPERFORMANCEGrade A dropped 1.9ppts q-o-q in rents and 2.4ppts q-o-q in occupancy rates, averaging at USD31.4/sqm/month and 84% respectively. Grade B slightly increased 0.45ppts q-o-q in rents and remained stable in occupancy rates, reaching at USD22.1/sqm/month and 84% respectively.

The highest average asking rent for both two Grades was recorded in West Lake and Hoan Kiem district, followed by Cau Giay District and Ba Dinh District.

SUPPLYHanoi serviced apartment market consists of approximately 3,567 units from 43 projects.

Grade A accounts for 58% of the total supply, providing 2,070units from 15 projects. The majority of Grade A supply was located in Ba Dinh, West Lake and Tu Liem district. Grade B takes 41% of the market share with 1,497 units from 28 projects. A significant proportion of Grade B is located in Ba Dinh and Hai Ba Trung districts.

DEMANDExpatriates working for multinational enterprises, embassies and consulates, international schools and universities are major occupiers in Hanoi serviced apartments.

With increasing FDI inflows to industrial parks scattered around the capital city and Bac Ninh, there is growing demand for serviced accommodation for foreign experts. Despite having to commute everyday between the two cities, expatriates still prefer to stay in Hanoi due to its convenient facilities and attractive social entertainments.

OUTLOOKDue to large existing supply from the market, landlords will be under pressure of reducing asking rents in the coming period. Demand for this type of accommodation will sustainably grow thanks to the rising number of foreign skilled workers in industrial zones in Hanoi and neighboring provinces.

Figure 33: Serviced Apartment, Average asking rent by grade


Figure 31: Serviced Apartment, Total supply


Figure 32: Serviced Apartment, Occupancy rate by grade


0

5

10

15

20

25

30

35

40


2012 2013 2014 2015 2016

USD

/sq

m/m

onth

Grade A Grade B

60%

70%

80%

90%

100%


2012 2013 2014 2015 2016

Grade A Grade B

-

500

1,000

1,500

2,000

2,500

3,000

3,500

2000 2005 2010 2011 2012 2013 2014 Q4 2015 Q1 2016

Grade A Grade Bunits







Table 3: Significant Office ProjectsTable 16: Significant Serviced Apartment Projects

No. Project Name Address Location Total Units

Average Occupancy

ARR(*) (**)

1 Hanoi Daewoo 360 Kim Ma Ba Dinh 193 85% 28.02 Fraser Suites Hanoi 51 Xuan Dieu Tay Ho 184 97% 39.0

3 Hanoi Club 76 Yen Phu Tay Ho 70 90% 28.0

4 Hanoi Somerset Grand 49 Hai Ba Trung Hoàn Kiem 185 80% 32.05 Pacific Place 83B Ly Thuong Kiet Hoan Kiem 47 85% 19.06 Sendona Suites 96 To Ngoc Van Tay Ho 170 87% 34.07 Sofitel Plaza 1 Thanh Nien Ba Dinh 56 100% 40.08 Somerset Hoa Binh 106 Hoang Quoc Viet Cau Giay 206 87% 30.09 Somerset West Lake 254D Thuy Khue Tay Ho 90 82% 33.010 Sun Red River 23 Phan Chu Trinh Hoan Kiem 46 94% 23.011 Intercontinental Ha Noi 13 Nghi Tam Tay Ho 25 90% 33.012 Hanoi Lake View 28 Thanh Nien Tay Ho 26 88% 30.013 Crown Plaza 36 Le Duc Tho Tu Liem 136 100% 33.014 Calidas E6 Pham Hung Tu Liem 378 70% 30.015 Lotte Center Dao Tan - Cong Vi Ba Dinh 258 87% 35.0

Grade A 2,070 85% 31.9

1 Atlanta 49 Hang Chuoi Hai Ba Trung 50 95% 16.02 Flower Village Hanoi 14 Thuy Khue Tay Ho 131 70% 24.03 Elegant Suites 19B Ha Hoi Hoan Kiem 39 95% 21.04 Elegant Suites Westlake 10C Dang Thai Mai Tay Ho 131 80% 26.05 Hanoi Lake 11-13 Nam Trang Ba Dinh 10 90% 21.06 Hoa Binh Green No. 14, Ally 376 Buoi Ba Dinh 40 90% 14.07 Lakeside Garden 56 Xuan Dieu Tay Ho 8 90% 14.08 May Fair 34B Tan Phu Ba Dinh 48 98% 17.0

9 Oriential Palace 33 Tay Ho Tay Ho 59 80% 23.0

10 Park View 9 Nguyen Binh Khiem Hai Ba Trung 6 100% 15.011 Rainbow 7 Trieu Viet Vuong Hai Ba Trung 26 81% 15.0

12 Rose Garden 170 Ngoc Khanh Ba Dinh 96 70% 22.0

13 Swan Lake 3/61/31 Xuan Dieu Tay Ho 6 100% 21.014 Skyline Tower 4 Dang Dung Ba Dinh 79 96% 19.015 V-Tower 649 Kim Ma Ba Dinh 36 100% 28.016 DC Building 144 Doi Can Ba Dinh 9 70% 17.017 Hoa Binh Hotel 27 Ly Thuong Kiet Hoan Kiem 9 100% 22.0

18 Palace de Thien Thai 2 Tho Nhuom Hoan Kiem 16 100% 18.0

19 The City Residences 37 Phan Dinh Phung Ba Dinh 15 96% 19.0

20 Candle Hotel 287-301 Doi Can Ba Dinh 69 84% 26.0

21 Pan Horizon 157 Xuan Thuy Cau Giay 86 70% 22.0

22 Jana Garden Terrace 6 Kim Dong Hoang Mai 72 50% 19

23 DMC Lake View 535 Kim Ma Ba Dinh 66 85% 14

24 Time City 485 Minh Khai Hai Ba Trung 150 95% 14

25 Royal City 72 Nguyen Trai Thanh Xuan 100 65% 16

26 My Way 4, Alley 86, Duy Tan Cau Giay 39 90% 30

27 Dolphin 28 Tran Binh Tu Liem 70 80% 13

28 Lancaster Hanoi 20 Nui Truc Ba Dinh 31 87% 27

Grade B 1,497 81.6% 20.0

(*) US/sqm/month (**) ARR (Average Rental Rate): All rents are stated in gross rents per sqm, not including VAT and serviced charge

Q1 2016 | HA NOI | INDUSTRIAL



PERFORMANCEAverage gross asking rent in Hanoi’s IPs reached USD83/sqm/term and the remaining Land Use Right was 34.8 years.

IPs in Hanoi had the average occupancy rate of 61.6%. Hoa Lac High- tech park has the lowest occupancy rate of 18%-22%. If the 1,586ha high tech park is being excluded from the calculation, the average occupancy rate would be 91% while the average rent would be increased to USD103.5/sqm/term. Rent of ready- built factory- in Hanoi range from USD1.5 – USD2.5/sqm/month.

SUPPLYHanoi has 11 IPs and more than 3,800ha of industrial area. Under the socioeconomic development plan by 2020 with visions until 2030, Hanoi will be home of 33 industrial and hi tech parks.

DEMANDAccording to the Ministry of Planning and Investment, the city attracted USD303 million of new and supplementary FDI capital in the first quarter of 2016. The majority of investments are flown into industries such as intermediate goods, machinery, spare parts & accessories, electronics..

Infrastructures are being developed to connect Northern provinces with Hanoi which will significantly reduce time and costs of transportation and commercial traffic. These will positively contribute to improve the occupancy rate and asking rate of IPs.

OUTLOOKPrices and occupancy rate are expected to increase steadily in the next coming quarters as the inflow of foreign investments is expected to continue. In the master plan for Hanoi, the capital city will have 24 industrial parks in 2020 and 33 industrial parks in 2030. The industrial area at that time will also be increased to 6,100ha and 8,000ha respectively.

In general, infrastructure and associated services of Hanoi’s IPs are not as satisfactorily as those of HCMC’s IPs. Therefore, IPs’ developers should concentrate on building more associated in-frastructures and utilities as banks, shopping malls, schools, hospitals, in order to improve the quality of life of IP’s employees.


Figure 34: Industrial, Net absorption


Figure 35: Industrial, Supply by District


Table 17: Industrial, Future Supply


-15-10-505

101520253035


2012 2013 2014 2015 2016

ha

Industrial Park Name District GFA (ha)

Quang Minh II Industrial park Me Linh 266

Phuc Tho Industrial park Phuc Tho 74

Phu Xuyen Industrial park Phu Xuyen 488

Thanh My - Xuan Son Industrial park Son Tay 108

Soc Son Industrial park Soc Son 340

Soc Son II Industrial park Soc Son 204

Soc Son III Industrial park Soc Son 180

Soc Son IV Industrial park Soc Son 216

Thanh Oai II Industrial park Thanh Oai 480

Habeco Industrial park Thuong Tin 300

Dong Anh35%

Thach That23%

Chuong My12%

Me Linh12%

Tu Liem9%

Others9%

Q1 2016 | HA NOI | INDUSTRIAL Q1 2016 | HA NOI | INDUSTRIAL



Table 3: Significant Office ProjectsTable 18: Hanoi Industrial Market Overview

No. Name of Industrial Park Location Distance to CBD (km)

Total Area(ha)

Asking Rent (US$/sqm) Occupancy LUR Term

1 Nam Thang Long Tu Liem 15 261 155 99% 20482 Noi Bai Soc Son 31 116 140 100% 20443 Dai Tu Long Bien 12 40 140 36% 20454 Quang Minh Me Linh 24 344 70 95% 20535 Phu Nghia 1 Chuong My 24 170 95 100% 20586 Phu Nghia 2 Chuong My 24 238 95 65% 20587 Hanssip (phase 1) Phu Xuyen 44 72 120 25% 20608 Dong Anh Dong Anh 19 470 100 95% 20579 Sai Dong B (Phase I&II) Long Bien 11 97 95 100% 204610 Thang Long Dong anh 16 302 95 100% 204711 Thach That Thach That 24 150 100 100% 205612 Hoa Lac Hi-Tech Thach That 39 1,586 55 20% 2048

Total 3,847 83 62%

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Vietnam Quarterly Knowledge Report | Q1 2016

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