Q3 GDP Growth Accelerates

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1 Hanoi City

2 ECONOMY 2

3 E C O N O M Y Q3 GDP Growth Accelerates Q1 2017: 5.15% Q2 2017: 6.28% Manufacturing (9M) Exports (9M) Target credit growth for % y-o-y 19.8% y-o-y 21% y-o-y While the short-term outlook is pretty decent, risks are building. In particular, we are increasingly concerned by the rapid increase in debt. Gareth Leather, senior Asia economist at Capital Economics Ltd. Q3 2017: 7.46% 9M 2017: 6.41% 2017 Goal: 6.7% Source: Bloomberg, General Statistics Office Of Vietnam. 3

4 E C O N O M Y Economic Highlights Retail Turnover: VND2,917 trillion (~US$128 billion) 9% y-o-y real growth New Real Estate Business Licence: 3,500 62% y-o-y FDI: $25.5 billion 34% y-o-y into Real Estate: 4.5% of total FDI Note: Data recorded for 9M

5 E C O N O M Y First-timers in Vietnam 5

6 E C O N O M Y Bright Outlook for Vietnam s Tourism Ho Chi Minh City to auction investment packages in Vietnam s largest stadium 6

7 CAPITAL MARKET 7

8 I N V E S T M E N T Source: Newspaper articles retrieved on 25 September

9 I N V E S T M E N T Private Equity Investment in Q Source: Newspaper articles retrieved on 25 September

10 I N V E S T M E N T Private Equity Investment in Vietnam Major Real Estate PE Investment Top PE investment by sector in 2016 and 2017 Investment Fund Project/ Company Value Year Real estate Retail US$613.5 million US$328.8 million EXS Capital Son Kim Land US$46 million 2017 Education Finance Technology Infrastructure Entertainment US$211 million US$85.4 million US$66 million US$60.2 million US$42.5 million China Fortune Land Development Warburg Pincus, Vinacapital AON, Mirae Asset Dai Phuoc Lotus Sofitel Legend Metropole Hanoi Landmark 72 US$64 million US$100 million US$382.5 million Source: Deal Street Asia, retrieved on 25 September

11 I N V E S T M E N T Notable Transactions in Q3 2017: Development Sites Vina Square My Gia Township Otis Hotel City HCMC Nha Trang Nha Trang Land use Mixed-use Residential Hotel Land area 30,000 sm 60,000 sm 4,000 sm Seller/ Developer VinaLand VinaLand (50% interest) Confidential Buyer Tri Duc Real Estate Confidential P.H Group Source: Real Capital Analytics. 11

12 Transaction value (US$ million) No. of transactions I N V E S T M E N T Income Producing Assets and Development Sites Transactions Vietnam Investment Volume 2,000 1,600 1, M 2017: foreign buyers made up 68% transaction value M 2017 Commercial Mixed use Residential No. of transaction 0 Disclaimer: Transactions include deals above US$10 million. Information contained herein, including projections, has been obtained from sources believed to be reliable. While we do not doubt its accuracy, we have not verified it and make no guarantee, warranty or representation about it. It is your responsibility to confirm independently its accuracy and completeness. This information is presented exclusively for use by CBRE clients and professionals and all rights to the material are reserved and cannot be reproduced without prior written permission of CBRE. Source: CBRE Vietnam, RCA. 12

13 I N V E S T M E N T Vietnam Asset Management Company VAMC seizes collateral of Saigon One Tower VAMC, Sacombank sign contract to settle bad debt VAMC calls for debt settlements of 8 plots of Hoan Cau Group Audit pending projects The Ministry of Finance proposed a list of 60 projects to be audited Source: VAMC, retrieved from newspaper on 1 Oct

14 INFRASTRUCTURE 14

15 I N F R A S T R U C T U R E Hanoi: Metro Line No.2A - Delayed trial operation as scheduled in Oct 2017 Metro Line No. 2A Cat Linh Ha Dong 95% completed Cat Linh Station Hoang Cau Royal City Ring Road No.3 Van Khe Yen Nghia Depot Depot Station 15 Source: Images from Internet

16 I N F R A S T R U C T U R E Hanoi: Can New Bridges Unleash the Potential of Its Eastern Districts? Residential supply by Q West of Hanoi 135,500 units 41,000 units Residential supply by Q East of Hanoi 15,300 units 4,800 units Current bridge Future bridge 16

17 I N F R A S T R U C T U R E Hanoi: Upgrading Ring Roads to Create Greater Connection among Districts Trung Kinh Tran Duy Hung The costliest road in the world 0.5km US$50 million Completed Under-construction Planned for new construction Planned for expansion Source: Images from Internet 17

18 I N F R A S T R U C T U R E HCMC: More Bridges and New Roads to Push the East Further HCMC announce 1/500 master plan for Da Phuoc depot of Metro line no.5 HCMC authorities approved inter-ward roads projects in District 9 The People's Committee of Ho Chi Minh City has approved the construction of a road linking the inter-ward road (Huy Can Street) to Do Xuan Hop Street, District 9 from the capital of residential project investors in the area. From July 15, traffic will not be available on this route on Saturday and Sunday from 19:00 until 2:00 the next morning. 18

19 I N F R A S T R U C T U R E HCMC: Upgrading Ring Roads Cat Lai Port Current Container Truck Route Future Container Truck Route Under Planning Completed 19 Road widening approved

20 OFFICE 20

21 O F F I C E Q Market snapshot HANOI HCMC Grade A Grade B Grade A Grade B New Supply No new supply No new supply 32,000 sm NLA No new supply US$24.1psm pm US$13.7psm pm US$36.7psm pm US$20.7psm pm Asking rents(*) 8.6% y-o-y -0.1% q-o-q 1.4% y-o-y -0.2% q-o-q -5.5% y-o-y 1.1% q-o-q 3.9% y-o-y -1.4% q-o-q 11.1% 16.0% 6.6% 2.8% Vacancy rate -5.9% y-o-y -0.1% q-o-q 1.2% y-o-y -1.4% q-o-q 2.3 ppts y-o-y 1.4 ppts q-o-q 0.0 ppts y-o-y -1.2 ppts q-o-q Source: CBRE Vietnam, Q (*) Asking rents: US$ psm pm (exclusive of VAT, service charge) 21

22 O F F I C E Total Supply in Major Cities Grade A and B Total Supply by City, Vietnam (NLA, sm) Hai Phong 52,234 sm Hanoi 1,233,462 sm Da Nang 79,987 sm 1,000,000 Grade A Grade B 800, , , ,000 0 HCMC Hanoi Da Nang Hai Phong Grade A Total Supply, Regional Cities (NLA, sm) (*) Total supply in NLA HCMC 1,144,267 sm 8,000,000 6,000,000 4,000,000 2,000,000 0 HCMC Hanoi Singapore Bangkok Tokyo Hong Kong Source: CBRE Vietnam, CBRE APAC, GSO. 22

23 O F F I C E Hanoi: New Supply in 2017 Grade A Grade B Sun Square 9,880 sm, NLA Q Eurowindows 13,274 sm, NLA Q Richy Tower 7,832 sm, NLA Q HUD Tower 24,051 sm, NLA Q Source: CBRE Vietnam. DSD Building 14,000 sm, NLA Q Horison Tower 8,015 sm, NLA Q1 2017

24 O F F I C E HCMC: New Supply in 2017 Grade A Grade B Saigon Centre P2 32,000 sm NLA Q Sai Gon Giai Phong 8,800 sm NLA Q Viettel Complex 23,620 sm NLA Q Etown Central 35,000 sm NLA Q

25 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Asking rents (US$ psm pm) Vacancy rate (%) Asking rents (US$ psm pm) Vacancy rates(%) O F F I C E Outlook is Stabilizing HANOI HCMC 50 50% 50 50% 40 40% 40 40% 30 30% 30 30% 20 20% 20 20% 10 10% 10 10% 0 Q1Q2Q3Q4Q1Q2Q3Q4Q1Q2Q3 0% 0 0% Source: CBRE Vietnam, Q Asking rents: US$ psm pm (exclusive of VAT, service charge) 25

26 NLA (sm) NLA (sm) O F F I C E Hanoi: Stable Absorption in Grade B HCMC: Strong Net Absorption Because of New Supply 70,000 HANOI 50,000 30,000 10,000-10,000 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q HCMC 70,000 50,000 30,000 10,000-10,000 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q Grade A Grade B Source: CBRE Vietnam, Q Asking rents: US$ psm pm 26

27 O F F I C E Regional Demand Comparison: Where is Vietnam? Multinationals expected change in real estate portfolios over the next three years Consolidation Expansion by Multinationals Source: CBRE 2017 APAC Occupier Survey Respondents Profiles: The CBRE 2017 Asia Pacific Occupier Survey incorporates the findings of a regional survey of multinational occupiers along with four separate national surveys of domestic occupiers in China, India, Japan and Australia. A total of 450 responses were received. The 27 analysis in this report largely focuses on the responses received from the 50 multinational respondents. Respondents were senior executives responsible for overseeing their organisation s regional and / or global real estate portfolio.

28 O F F I C E Sentiment Remains Positive among Decision Makers EuroCham Business Climate Index for Vietnam, Q Source: Eurocham, Q

29 HCMC HANOI O F F I C E Demand: Relocation to Dominate the Market 32% HANOI 7% 61% HCMC Finance/ Banking 21% Manufacturing 18% - 24% Real Estate 9% 12% 10% 79% Media 10% Service 14% Source: CBRE Vietnam, based on CBRE s enquiries, only 29

30 O F F I C E Demand: Higher Demand for Large Floor Plate HANOI 100% 80% 60% 40% 20% 0% Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q % 80% 60% 40% 20% 0% HCMC Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q < 100 sm sm sm sm > 1000 sm Source: CBRE Vietnam, based on CBRE s enquiries, only 30

31 O F F I C E Market Trend: Large Areas Attract Tenants HANOI IT/Technology 2,300 sm Banking 1,823 sm Grade A Grade B IT/Technology 1,600 sm TNR Tower Horison Tower HCMC Source: CBRE Vietnam, Q Viettel Saigon Centre Complex P2 Professional Services IT 1,749 sm 5,000 sm IT E-commerce 1,342 sm 4,000 sm Mapletree BC Manufacturing 1,274 sm Deutsches Haus Manufacturing 1,500 sm

32 O F F I C E Co-Working Space: Becoming the Big Boy s game within APAC and Global Share of Co-Working Space who Anticipates a strong increase in Events Sense of Community Income Members 0% 20% 40% 60% CWS 18 months & older CWS Up to 17 months older Source: CBRE Vietnam, Q

33 No. of venues Growth rate (%) O F F I C E Co-Working Space in Vietnam: On the way to catch up Estimated number of co-working centres and the percentage run by local operators 100% 80% 60% 40% 20% 0% Beijing India (Tier 1 Shanghai Singapore Hong Kong Sydney cities) % local operators Estimated total number of co-working centres No. of co-working venues by year in Vietnam % 200% 100% Q % HCMC Hanoi Growth Rates Source: 2017 The Evolution of Co-Working in Asia Pacific; CBRE Vietnam, Q

34 New Supply (NLA sm) New Supply (NLA sm) No new Supply O F F I C E Market Outlook - Supply HANOI 200,000 FORECAST 150, ,000 50, , F 2018F 2019F HCMC 150, ,000 50, F 2018F 2019F Source: CBRE Vietnam, Q

35 Net Absorption (NLA, sm) Vacancy Rate (%) O F F I C E Market Outlook Net Absorption and Vacancy Rate HANOI 80,000 FORECAST 40% 60,000 30% 40,000 20% 20,000 10% F 2018F 2019F 0% HCMC 80,000 40% 60,000 30% 40,000 20% 20,000 10% F 2018F 2019F 0% Source: CBRE Vietnam, Q

36 INDUSTRIAL AND LOGISTICS 36

37 I N D U S T R I A L & L O G I S T I C S Quality Supply Increases - Especially Foreign Invested Industrial Parks Thang Long III Industrial park Vinh Phuc 213 ha Nghe An Hemaraj Industrial City 3,200 ha By Sumitomo Corporation Binh Duong By Hemaraj VSIP III Industrial park 1,000 ha By Sembcorp 37

38 HCMC Thanh Hoa Bac Ninh Nam Dinh Binh Duong Ha Noi Kien Giang Dong Nai Tay Ninh Hai Phong Bac Giang Binh Phuoc Quang Ngai Ba Ria - Vung Tau Long An Registered FDI (million US$) I N D U S T R I A L & L O G I S T I C S Foreign Direct Investment Top 15 provinces by total registered FDI (8M 2017) 3,500 3,000 2,500 2,000 1,500 1, Source: Ministry of Planning and Investment. 38

39 I N D U S T R I A L & L O G I S T I C S DEMAND - Automotive, Electronics and Textile Hai Phong Major transactions VINFAST 335ha Quang Ngai HCMC Area Industrial park Site area (ha) Company Industry North 335 Vinfast Automotive Central Trang Due 1.5 KR EMS Electronics Dinh Vu 2.7 Top Solvent Oil & Gas VSIP Quang Ngai VSIP Quang Ngai 14 Hebei Xindadong Textiles Textile 8 Wanex Furniture Furniture South VSIP II 8 Tata Coffee F&B Hiep Phuoc 7 CJ Cau Tre F&B

40 HCMC Binh Duong Dong Nai Long An Quang Tri Thua Thien Hue Da Nang Quang Nam Quang Ngai Bac Ninh Hanoi Bac Giang Hai Duong Hai Phong Hung Yen Philippines Cambodia Indonesia East Bangkok I N D U S T R I A L & L O G I S T I C S Rents Land rental by province and compared to regional (USS/sm/term) 300 Region Source: CBRE Vietnam. *Term: years 40

41 HCMC Binh Duong Dong Nai Long An Da Nang Quang Nam Quang Ngai Bac Ninh Hanoi Bac Giang Hai Duong Hai Phong Hung Yen Philippines Cambodia Indonesia East Bangkok I N D U S T R I A L & L O G I S T I C S Rents Ready-built-factory by Province and compared to regional (US$/sm/month) 7 Region Source: CBRE Vietnam. 41

42 I N D U S T R I A L & L O G I S T I C S Northern Areas Road and Rail Links to Seaports Upgrade Hanoi - Hai Phong Ha Long 2018 Noi Bai International Airport Hai Phong Port Quang Ninh IPs Under Planning Ninh Binh Hai Phong Quang Ninh, Noi Bai Ha Long Provide more options in transporting goods Quang Ninh port 42

43 I N D U S T R I A L & L O G I S T I C S Southern Areas Road and Rail Links to Seaports OPTIONS AGAINS SEARCH RADIUS & MAJOR INFRASTRUCTURE Cat Lai Port Hiep Phuoc Port Ben Luc - Long Thanh Highway (58 km, 8 lanes, 2019) Cai Mep Port 43

44 Rental rate (US$/sm/term) % Growth Y-o-Y Rental rate (US$/sm/month) % Growth Y-o-Y I N D U S T R I A L & L O G I S T I C S OUTLOOK Industrial land, Rental rate forecast RBF, Rental rate forecast 120 Forecast 15% 5 Forecast 15% % 4 12% % 6% 3 2 9% 6% 20 3% 1 3% F 2018F 2019F Land Rents - South Rental Growth - South 0% Land Rents - North Rental Growth - North Source: CBRE Research South provinces: HCMC, Long An, Binh Duong, Dong Nai. North provinces: Bac Ninh, Bac Giang, Ha Noi, Hai Phong, Hung Yen, Hai Duong. 0 0% F 2018F 2019F Rents -South Rents - North Rental Growth - South Rental Growth - North Demand driving factors Continue from traditional sectors Agriculture Retail & consumer goods Manufacturing And from rising sectors E-commerce Electronics Automotive & Motorcycle

45 RESIDENTIAL MARKET LUXURY: >US$3,500 psm HIGH END: US$1,500 - $3,500 psm MID END: US$800 $1,500 psm AFFORDABLE: <US$800 psm 45

46 C O N D O M I N U M Q Market Snapshot HANOI HCMC High-end Other Segments High-end Other Segments 1,480 units 6,817 units 1,822 units 5,963 units -45% y-o-y 32% y-o-y -23% y-o-y -2% y-o-y New Launches -38% q-o-q 19% q-o-q -31% q-o-q -14% q-o-q US$1,962 psm US$1,044 psm US$2,175 psm US$1,244 psm -3% y-o-y Primary Price (*) -1% q-o-q -10% y-o-y 1% q-o-q 10% y-o-y 5% q-o-q -27% y-o-y -7% q-o-q 1,381 units 4,059 units 2,098 units 5,109 units Sold units -26% y-o-y 1% q-o-q 19% y-o-y 24% q-o-q -3% y-o-y -8% q-o-q -11% y-o-y -29% q-o-q Source: CBRE Vietnam, Q (*) Primary Price is average asking price of actively-for-sale projects, reflecting new projects pricing level. Price is exclusive of VAT and maintenance fee 46

47 No. of Sold Units No. of Sold Units C O N D O M I N I U M Sold Units: High Absorption Rate in Newly Launched Projects HANOI HCMC 14,000 14,000 12,000 12,000 10,000 10,000 8,000 8,000 6,000 6,000 4,000 4,000 2,000 2,000 0 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 0 Q1Q2Q3Q4Q1Q2Q3Q4Q1Q2Q Absorption Rate in Newly Launched Project in Q % 39% 40% 77% 84% 81% Source: CBRE Vietnam, Q

48 C O N D O M I N I U M New Launch: Mid-end segment continues to expand HANOI As of 2014 As of Q % 1% Mid-end 64,361 units 24% 47% CAGR (Mid-end) = 22% CAGR (Market) = 20% 25% 50% Mid-end 112,448 units 29% 25% HCMC 1% 2% 27% 29% Mid-end 37,335 units 32% CAGR (Mid-end) = 35% CAGR (Market) = 25% 39% Mid-end 85,559 units 40% 30% *Accumulated supply from 1999 to Q Source: CBRE Vietnam, Q

49 C O N D O M I N I U M Hanoi - West and South West Continue to Supply Majority of New Stock 8,297 units launched in Q3 17 (The West: 33% The South West: 27%) from 38 projects TAY HO 4 DONG ANH 1 PentStudio 55% sold TU LIEM WESTLAKE HOAI DUC 9 CAU GIAY 3 BA DINH HOAN KIEM LONG BIEN The Emerald My Dinh 60% sold THANH XUAN DONG DA HAI BA TRUNG 3 Aquabay Grand Park Tokyo Touch GIA LAM 70% sold 1 HA DONG 6 7 THANH TRI Source: CBRE Vietnam, Q Bubble size: size of new launch supply in that district Number in the bubble illustrates the number of projects launched in the period 1 HOANG MAI HUNG YEN 2 49

50 C O N D O M I N I U M HCMC: New Launches Continue to Focus on the South and the East 7,651 units launched in Q3 17 (The South: 50%; The East: 37%) from 21 projects Topaz Elite 90% sold 5 D Edge 100% sold 1 Tilia Residences >95%sold Source: CBRE Vietnam, Q Bubble size: size of new launch supply in that district Number in the bubble illustrates the number of projects launched in the period 50

51 C O N D O M I N I U M Pre-sale Activities High Interest from Buyers Dragon Riverside city District 5 Over 50% reserved Masteri An Phu District 2 Mizuki Park Binh Chanh District Q2 Thao Dien District 2 51

52 Vingroup TNR Holdings HBI - M.I.K Vinaenco Viet Hung CIRI Thu Do Invest. Vingroup Thao Dien Investment Phu My Hung Novaland TNR An Gia Vietcomreal + Tien Phat Phat Dat Units Units C O N D O M I N I U M On Time Delivery is Highly Appreciated Handover in 9M2017, Hanoi Handover in 9M2017, HCMC 8,000 6,000 4,000 2, ,000 6,000 4,000 2,000 0 * In selected projects Source: CBRE Vietnam, Q ,408 units were handed over in Q3 2017, decreasing by 32% y-o-y 8,818 units were handed over in Q3 2017, increasing by 38% y-o-y Buyers directly monitor the progress of the project 52

53 Asking price (US$ psm) Asking price (US$ psm) C O N D O M I N I U M Primary Price - Small adjustments across segments HANOI $5,000 $4,000 $3,000 $2,000 $1,000 $0 Luxury: -1% q-o-q High-end: -1% q-o-q Mid-end: -2% q-o-q Affordable: 1% q-o-q Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q HCMC $5,000 $4,000 $3,000 $2,000 $1,000 $0 Luxury: 0% q-o-q High-end: 5% q-o-q Mid-end: -3% q-o-q Affordable: 2% q-o-q Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q Primary price calculated on NSA and without VAT Source: CBRE Vietnam, Q

54 C O N D O M I N I U M Foreign Buyers Foreigners may be allowed to deposit savings in Vietnam Under this circular, legal foreign persons present in Vietnam in the form of branches, representative offices, executive offices, operation offices, diplomatic missions and consular representations can deposit under certain terms to serve their activities in Vietnam as non-residents. Non-residents are individuals who are present in Vietnam, including foreigners residing in Vietnam for less than 12 months; foreigners studying, treating diseases, traveling or working for representative offices, executive offices, operation offices, diplomatic missions and consular representative agencies of foreign legal persons in Vietnam. Foreigners to be allowed to own houses in Vietnam for up to 99 years Prime Minister Nguyen Xuan Phuc has said it is necessary to create a special legal framework to attract investment in special zones. A draft law will allow foreigners to own houses for up to 99 years and allow mortgaging of assets associated with land-use rights at foreign credit institutions, which is in line with the 2013 Constitution Ministry proposes permanent residence cards for foreign investors on Phu Quoc Vietnam may issue permanent residence cards to foreign investors on Phu Quoc Island under a draft law on special administrative zones submitted to the government by the Ministry of Planning and Investment (MPI) 54

55 New Launch (units) New Launch (units) C O N D O M I N I U M Market Outlook - Supply 50,000 40,000 30,000 20,000 10,000 - HANOI FORECAST F 2018F 2019F HCMC 50,000 40,000 30,000 20,000 10, F 2018F 2019F Source: CBRE Vietnam, Q

56 Sold units Sold units C O N D O M I N I U M Market Outlook Absorption 50,000 40,000 30,000 20,000 10,000-50,000 40,000 30,000 20,000 10,000 0 HANOI FORECAST F 2018F 2019F HCMC F 2018F 2019F Source: CBRE Vietnam, Q

57 F 2018F 2019F Percentage change (%) Percentage change (%) F 2018F 2019F C O N D O M I N I U M Market Outlook Primary Pricing 200% 150% 100% 50% 0% HANOI FORECAST 200% 150% 100% 50% HCMC 0% Source: CBRE Vietnam, Q Note: (1) Base year is 2005 (2) No luxury project in Hanoi until 2011 Luxury High-end Mid-end Affordable 57

58 C O N D O M I N I U M Key Takeaways 1 Continued Good Absorption High-end offerings at prime locations still have good absorption. 2 Competitive Rental Market Upcoming handovers of completed units will lead to growing competition on the rental market. Buy-to-let investors should watch out 3 Expansion of Mid-end Segment Opportunities for developers to differentiate 58

59 Units L A N D E D P R O P E R T I E S Hanoi: New Supply Keeps Increasing in the West New launches, 2015 Q ,000 1,500 Accumulated launches, YTD 2017 North 10% 1, West 50% Core districts East 27% 0 Q1Q2Q3Q4Q1Q2Q3Q4Q1Q2Q Villa Terraced Shophouse South West 0% South 13% New launch 1,055 units in Q % y-o-y 2,619 units YTD % of sold units 78% y-o-y Primary Price US$3,685 psm 27% y-o-y 224% q-o-q 52% q-o-q 1.2% q-o-q Source: CBRE Vietnam. Primary price is based on land area, included construction cost and VAT 59

60 L A N D E D P R O P E R T I E S Hanoi: New Supply Keeps Increasing in The West Louis City The Mansions The Eden Rose Iris Home 599 units US$2,800 psm 146 units US$4,800 psm 233 units US$2,500 psm 77 units US$3,500 psm Louis City Ha Dong district: 7% q-o-q: US$2,900 Thanh Tri district: 4% q-o-q: US$1,800 Hoang Mai district: 7% q-o-q: US$3,200 Gamuda Gardens Park City The Eden Rose 60 Q-o-Q Changes are based on secondary prices in districts that had new launches in the review quarter

61 Units L A N D E D P R O P E R T I E S Hanoi: Outside the Center, the West Drove the Market in terms of Sold Units and Secondary Prices Sold units, 2016 YTD 2017 Secondary prices, 2016 YTD ,000 4,000 3,000 2,000 1,000 0 West Q1 Q2 Q3 Q4 Q1 Q2 Q West East South North Center Source: CBRE Vietnam. Resale price Q-o-Q Change Y-o-Y Change Cau Giay Tay Ho Bac Tu Liem Long Bien Thanh Tri $5,000 $4,000 $3,000 $2,000 $1,000 $0 Source: CBRE Vietnam. Secondary price is based on land area, included construction cost and VAT Thanh Xuan $3,793 Q1 Q2 Q3 Q4 Q1 Q2 Q3 West North Market Average Nam Tu Liem Dong Da Hoang Mai South East Ha Dong Market Average 0.4% 0.4% 1.4% 1.5% 4.1% 1.7% 2.0% 3.9% 6.9% 7.1% 3.3% 1.7% 4.7% 7.4% 1.3% 8.4% 8.9% 3.4% - 2.7% 2.3% 6%

62 L A N D E D P R O P E R T I E S Future Supply Further Launches from Existing Projects Future Supply, Q Starlake THT Phase 2 Tay Ho District Villas, Tay Ho Terraced District and Shophouse Starlake THT Phase 2 Villas, Terraced and Shophouse The Manor Central Park Park Hoang Mai District ~500 units (2017) Lakeside Splendora Hoai Duc District 77 villas Vinhomes The Harmony Long Bien District 493 units (next launch) 62

63 L A N D E D P R O P E R T I E S HCMC: Most new launches from small-scaled projects New launches, 2015 Q Accumulated launches, YTD ,400 1,200 1, Villas Townhouses Shophouses West 11% North 9% Central East 71% - Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q South 9% 454 units New launches in Q ,720 units YTD sold units Primary Price US$3,069 psm -35% y-o-y -38% q-o-q 62% of % y-o-y -31% q-o-q 20.5% y-o-y 11.8% q-o-q Source: CBRE Vietnam. 63

64 L A N D E D P R O P E R T I E S HCMC: New Launches at Different Price Segments Dien Thuan Star Hill 50 units@ District 12 US$2,500 D.12:US$1,000-2, % q-o-q Simcity 800 units@ District 9 US$1,460 D.9:US$1,700-1, % q-o-q Van Xuan Dat Viet 72 units@ Binh Tan US$2,300-2,500 Binh Tan: US$1,600-2,600 D.2:US$3,000-10, % q-o-q (*) Rosita Khang Dien 118 units@ District 9 US$1,740-1,870 PMH:US$3,800-5,700 2% q-o-q Citadel 68 units@ District 7 US$3,300 (*) Thu Thiem and vicinity. Change in asking price in secondary market 64

65 L A N D E D P R O P E R T I E S HCMC Future Supply of Many Large Scale Townships Thu Thiem Area: HongKong Land CII SonKim Land Thanh My Loi: Hung Thinh Novaland Tien Phuoc District 9: Vingroup Binh Chanh: Nam Long Khang Dien Nha Be: GS Nha Be District 7: Sunny World

66 L A N D E D P R O P E R T I E S Key Takeaways 1 Notable large-scale future supply Large scale future supply from existing township developments. 2 Good absorption rate Absorption rate is expected to remain positive, especially at year end, despite lowering new launches so far in City widespread development Bettered connectivity across the districts would bring quality townships to untapped locations.

67 RETAIL MARKET 67

68 R E T A I L Cost Escalation and Unclear Economic Prospects Remain Key Concerns Source: How Active Are Retailers in Asia Pacific, June

69 R E T A I L Most Fashion Retailers are Focused on Improvement of Sales Efficiency Satellite stores to focus on efficiency TRADITIONAL Flagship store to focus on in-store experience and brand promotion REFINED STRATEGY FLAGSHIP STORE + SATELLITE STORES Source: CBRE Research, January

70 % of New Retail Entrants R E T A I L F&B and Sporting Goods Retailers Drove Activity 50% H1 40% 30% 20% 10% 0% Coffee and Restaurants Specialist Clothing Mid Range Fashion Luxury and Business (Sports, Footwear) Value and Denim Source: CBRE Research, August

71 R E T A I L Rapid Growth of Fast Fashion Brands over the Past Few Years Store Presence of major fashion brands GLOBAL ASIA PACIFIC % Change % Change Inditex 5,044 7, % 482 1, % H&M 2,472 4, % % GAP 3,246 3, % % Fast Retailings 2,088 3, % 1,119* 1, % American Eagle Outfitters 1,111 1, % - 86 N/A A&F 1, (13%) % Esprit 1, (33%) (26%) * Figures as at 2012 Source: S&P Capital IQ, Corporate Information, May

72 R E T A I L They are Rationalizing Store Networks in Established Markets Major exits/closures by mass fashion brands in At the same time, upgrading and relocation of flagship store continues Hong Kong Singapore Korea Japan Brand Market Details Forever 21 ZARA Hong Kong Tokyo Relocated its flagship from Causeway Bay to Mongkok Expanded the flagship store by 900 sq.m. UNIQLO Singapore Opened the 1st flagship in Southeast Asia H&M Hong Kong Opened the largest flagship in Asia Australia Source: CBRE Research, May

73 R E T A I L but Expanding in Under-represented Markets Now Inditex H&M Source: Inditex Group, H&M Group, Inside Retail, The Hindu Business Line May

74 RETAIL Retailers Respond to the Market Both Hanoi and HCMC H&M Old Navy HCMC only Massimo Dutti Pull & Bear Stradivarius Source: H&M official site, Inside Retail Asia, Google Images 74

75 R E T A I L Developers Respond to the Market Thuan Kieu Plaza Garden Mall Crescent Mall Phase 2 The Vista Walk Oxygen Mall Vincom Centre Ba Trieu Source: Inside Retail Asia, The Saigon Times, Google Images 75

76 R E T A I L One of the Major Challenges in Vietnam is the Lack of Quality Supply Ha Long City 91,000 sm Retail Stock (sqm) Hanoi 788,053 sm Hai Phong City 50,000 sm Bangkok Singapore Da Nang City 68,675 sm HCMC Hanoi Can Tho 60,200 sm Nha Trang City 40,300 sm Ba Ria Vung Tau 60,400 sm HCMC 845,765 sm Phnom Penh Millions Note: Total supply in NLA includes shopping centres, department stores, commercial retail podium, excluding stand-alone supermarkets, hypermarkets, wet markets etc. Source: CBRE Research, CSO. 76

77 R E T A I L Key Trends to Drive Retail Development in Vietnam Construction of Metro Lines Expansion of Middle Class Rise of Millennials 77

78 R e t a i l Expanding toward developing residential and infrastructure areas North: New developing cluster Ring road 3 Line 2A Line 3 New CBD Booming developments Improving infrastructure CBD East: Already established standalone large scale shopping malls South and South West: Largest supply cluster Growing residential projects and population 78

79 R E T A I L New Metro Lines to Drive Retail Expansion North: mostly in already populated areas HIEP BINH PHUOC SUOI TIEN AN SUONG BA QUEO BEN THANH HUB East: City s focus. booming residential connecting infrastructure PHU LAM TAN KIEN CAN GIUOC South and South West:. Expanding of Phu My Hung Large available land bank NGUYEN VAN LINH Source: CBRE Research, September

80 R E T A I L Middle Class Population will be Much Bigger Households earning US$10,000 or above per year 80

81 R E T A I L More People will Trade Up in Their Consumption Source: Google Images 81

82 R E T A I L There are 17 Million Millennials in Vietnam POPULATION IN VIETNAM 60 or above Below Millions Source: Oxford Economics, September Source: CBRE Research, Asia Pacific Millennial Survey, October

83 R E T A I L Younger Generation to Drive Retail Trends They are aspiring for Healthy eating Active Lifestyle Fun & Entertainment and kids Source: Google Images, CBRE Research, Asia Pacific Millennial Survey, October

84 R E T A I L Key Takeaways 1 Steady market performance More international brands to arrive 2 Strategic Portfolio Planning Retailers may look for quality supply in up-and-coming neighborhood; Ongoing refinement in shopping centres tenant mix 3 Tap on the long term growth potential Rise of middle class and millennials 84

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