2013 Fearless Forecast

Transcription

1 2013 Fearless Forecast 2009 Location, location, location 2011 Timing, timing, timing 2013 Cash, cash, cash Presented by: Marc Townsend Managing Director Tuesday, 15 January, 2013

2 2012 YEAR IN REVIEW A W I N F O R M. N G U Y E N AN D C. H U Y N H Michael Nguyen won a silver in Olympics gymnastics Wrestler Carol Huynh brought home Olympic bronze for wrestling. CBRE Page 2

3 2012 YEAR IN REVIEW M O R E S U R P R I S E S Marc in Bhutan Where it all started for CBRE 10 years ago in Nam Ky Khoi Nghia Street, District 1, HCMC CBRE Page 3 Richard Leech runs 90k in 9.5 hours at the Comrades Ultra Marathon in South Africa

4 VIETN AM ECONOMY K E Y I N D I C AT O R S e 2013f GDP Growth Rate (y-o-y) 5.3% 6.8% 5.9% % 5.68% 4 Lending Rate 12.75% Down from 21% in Q3 16%-17.0% (Late 2010) 22% - 25% 2 12% - 15% 12% - 13% 5 Inflation (Average, y-o-y) 6.9% 1 9.2% (Dec 10: 11.8%) 18.58% % 9.4% (e-o-p) 5 Source: Historical data by GSO, 1 GSO, 2 SBV, 3 SJC, 4 Ministry of Planning & Investment, 5 ANZ, 6 HSBC CBRE Page 4 Exports US$57.1 bil US$71.6 bil US$96.3 bil US$114.6 bil US$129.5 bil 4 Imports US$69.9 bil US$84.0 bil US$105.8 bil US$114.3 bil US$ bil 4 Gold Price (per Tael) US$/VND (Commercial banks) FDI in Real Estate (committed) VND26.7 mil (Dec. 31, 2009, up 50% y-o-y) 18,497 (Dec. 31, 2009) VND36.1 mil (Dec. 31, 2010, up 35.2% y-o-y) 19,500 (Dec. 31, 2010) Devalued by 5.4% vs. Dec VND41.8mil 3 (Dec. 30,2011. up 15.8% y-o-y) 21,036 (Dec.31, 2011) Devalued by 7.9% vs Dec. 2010) VND46.3 mil (Dec. 28, 2012, up 10.8% y-o-y) 20,855 (Dec.31, 2012) - 21,500 6 US$7.6 bil US$6.8 bil US$11 bil US$10.46 bil US$ bil Committed FDI US$22.6 bil 1 (US$6.8 bil real US$18.6 bil estate) US$14.7 bil 1 (US$845.6 mil real estate) Implemented FDI US$10 bil US$11 bil US$11 bil 1 US$10.46 bil US$13 bil US$13 14 bil 4 US$ bil 4

5 2012 YEAR IN REVIEW T H E N E G AT I V E Residential prices continued to fall......as unsold inventory remained high, but stable... Luxury High-end Mid-end Affordable 5% 2% -1% % -7% -10% Source: CBRE Unit 30,000 25,000 20,000 15,000 10,000 5,000 0 Source: CBRE Total Unsold Total Launch leading to impacts in other sectors too. i.e. Falling Serviced Apartment rentals. $40 $35 $30 $25 $20 Grade A Rents Grade B Rents Elsewhere office rents decreased, again, but... Vacant Space Asking Rent 200,000 $26 150,000 $24 100,000 $22 50,000 $20 0 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 $ CBRE Page 5

6 2012 YEAR IN REVIEW T H E P O S I T I V E HCMC Office Rent Cycle appears to be approaching a bottom. Transactions visible at affordable projects the rise of the first time buyer? E Home 3 (P1): Total units: 333 Sold rate: over 70% Condominium completion increased y-o-y 10,000 No. of Unit No. of Project 35 8, , , , Source: CBRE CBRE Page 6 HCM City H Hoang Anh Thanh Binh (P1): Total unit: ~528 Sold rate: ~67% Sunview 3: Total unit:: ~330 Sold rate: ~80% Buyers: Young Professionals, Young Couples/Families, First Time Buyers

7 Vincom Center A 2012 BRIGHT SPOT R E T AI L C O M P L E T I O N, E N T R Y & E X P AN S I O N Pandora City PowerBowl 388 CBRE Page 7

8 Global reach, local expertise Unsurpassed connectivity and civic partnerships Highest caliber operations Customised client care programs Impeccable grounds and building environment Achievable real estate solutions Highest ethical standards Region Innovative tools and resources Robust procurement platform Global footprint Proactive client relations and retention Commitment to philanthropy Superior talent Personal touch Stringent quality control Performance and satisfaction benchmarking Fully integrated, comprehensive platform World-class services Unmatched connectivity Ambassadors of quality Financial integrity and accountability Superior sunstainability standards Community minded and charitable Building relationships, tracking trends Dynamic building management and communications Global excellence, local knowledge Proprietary General Management Council Thinking innovatively, but acting practically Unprecedented speed to market Performance and satisfaction benchmarking Unparalleled research capability Professionally trained staff Proprietary General Management Council Superior sunstainability standards Global reach, local expertise Unsurpassed connectivity and civic partnerships Commitment to confidentiality Highest caliber operations Proactive client relations and retention Commitment to philanthropy Superior talent Stringent quality control Global footprint Fully integrated, comprehensive procurement platform Ambassadors of quality Professionally trained staff Building relationships, tracking trends Commitment to confidentiality World-class services Unprecedented speed to market Thinking innovatively, but acting practically Global excellence, local knowledge Unparalleled research capability Superior talent CBRE Page 8

9 ASIA PACIFIC STILL THE HOME OF GROWTH 15 Real GDP Growth (%, y-o-y) 10 China Asia Pacific 5 0 World United States Western Europe Q Q Q Q Q Q Q Q Q Q Q1 Source: IHS Global Insight (November 2012) CBRE Page 9

10 2013 TO BE BETTER TH AN Real GDP % change per annum 2012 F 2013 F 7 GDP % Growth China India Indonesia Vietnam Source: Oxford Economics (November 2012) Malaysia Hong Kong Singapore Taiwan Philippines South Korea Australia New Zealand Thailand Japan South-East Asia Asia Pacific World CBRE Page 10

11 VIETN AM vs. CHINA and INDONESIA Real GDP Growth Rate (%) Vietnam China GDP per capita (US$) 7,000 6,000 5,000 4,000 3,000 2,000 1,000 0 Vietnam China Indonesia Source: Vietnamese General Statistics Office; World Bank; Oxford Economics CBRE Page 11

12 CBRE GLOBAL OFFICE CAPITAL VALUE INDEX PERIOD OF NOTABLE GROWTH - PARTICULARLY IN CORE CITIES 2001 Q1 = Global Americas Asia Pacific EMEA Source: CBRE Research CBRE Page 12

13 CBRE GLOBAL OFFICE CAPITAL VALUE INDEX SLOWING CAP VALUE GROWTH: RE-ALLOCATION OCCURRING Year-Over-Year % Change 50% 40% 30% 20% 10% 0% -10% -20% -30% -40% Global Americas Asia Pacific EMEA Source: CBRE Research CBRE Page 13

14 CONTINUED INCREASE IN DEALS <US$100 MIL SOUGHT AFTER DEAL SIZE IS THAT AVAILABLE IN VIETNAM 25 Total Investment Turnover in Asia Pacific by Deal Size 20 US$ billion Deals below US$100 mil Deals between US$250 mil and US$1 bil Deals between US$100 mil and US$250 mil Deals over US$1 bil Source: CBRE Research CBRE Page 14

15 ASIAN OFFICE MARKET SLOWS 14,000 16% 12,000 14% 10,000 12% 8,000 10% 000s sq. ft. 6,000 4,000 8% 6% 2,000 4% 0 2% -2,000 0% Q1 04 Q2 04 Q3 04 Q4 04 Q1 05 Q2 05 Q3 05 Q4 05 Q1 06 Q2 06 Q3 06 Q4 06 Q1 07 Q2 07 Q3 07 Q4 07 Q1 08 Q2 08 Q3 08 Q4 08 Q1 09 Q2 09 Q3 09 Q4 09 Q1 10 Q2 10 Q3 10 Q4 10 Q1 11 Q2 11 Q3 11 Q4 11 Q1 12 Q2 12 Q3 12 Source: CBRE Research As of Q Net Absorption Overall vacancy CBRE Page 15

16 OFFICE MARKETS STILL BELOW PEAK VACANCY 45 Vacancy Rates, % Cyclical Low Cyclical High Q *The cyclic low is the most recent low prior to the onset of the GFC; the cyclic high is the high experienced following the cyclic low. Source: CBRE Research CBRE Page 16

17 Global reach, local expertise Unsurpassed connectivity and civic partnerships Highest caliber operations Customised client care programs Impeccable grounds and building environment Achievable real estate solutions Highest ethical standards Innovative tools HCMC and resources Robust procurement platform Global footprint Proactive client relations and retention Commitment to philanthropy Superior talent Personal touch Stringent quality control Performance and satisfaction benchmarking Fully integrated, comprehensive platform World-class services Unmatched connectivity Ambassadors of quality Financial integrity and accountability Superior sunstainability standards Community minded and charitable Building relationships, tracking trends Dynamic building management and communications Global excellence, local knowledge Proprietary General Management Council Thinking innovatively, but acting practically Unprecedented speed to market Performance and satisfaction benchmarking Unparalleled research capability Professionally trained staff Proprietary General Management Council Superior sunstainability standards Global reach, local expertise Unsurpassed connectivity and civic partnerships Commitment to confidentiality Highest caliber operations Proactive client relations and retention Commitment to philanthropy Superior talent Stringent quality control Global footprint Fully integrated, comprehensive procurement platform Ambassadors of quality Professionally trained staff Building relationships, tracking trends Commitment to confidentiality World-class services Unprecedented speed to market Thinking innovatively, but acting practically Global excellence, local knowledge Unparalleled research capability Superior talent CBRE Page 17

18 VIETNAM MACRO PICTURE C O M M I T T E D F D I 16% 1% 27% 09% 70% 27% 14% 37% Commited FDI (Billion USD) Real Estate Manufacturing Construction Others Source: Vietnam Ministry of Planning and Investment Real Estate Manufacturing Construction Others Billion USD Total commited FDI Real Estate CBRE Page 18

19 VIETN AM FUTURE SUPPLY AC C O R D I N G T O B C I AS I A All Future Projects ( ) HCMC Hanoi Da Nang Can Tho Nha Trang (Khanh Hoa) Vung Tau Hai Phong Office Retail Hospitality and SA Residential Total Y-o-Y change 31.4% 155.4% 53.8% 47.1% 29.1% 37.1% 30.3% Projects Under Construction HCMC Hanoi Da Nang Can Tho Nha Trang (Khanh Hoa) Vung Tau Office Retail Hospitality and SA Hai Phong Resi Total Y-o-Y change 7.5% 77.0% 10.5% -51.7% -4.2% -11.9% -5.9% Source: CBRE CBRE Page 19

20 HCMC INVESTMEN T C APITAL D I F F I C U L T I E S AC C E S S I N G C AP I T A L T O K E E P D E V E L O P M E N T L I M I T E D Development Capital Needed in HCMC, Next Three Years Office Retail Hotel Serviced Apartment US$ million Source: CBRE CBRE Page 20

21 VIETN AM INVESTMENT TRENDS D E AL S W I L L H AP P E N Deals did happen including numerous Vietnamese to Vietnamese residential project transfers, suggesting a bottoming of the market. Vietnam remains on the radar. Japanese to be the pre-eminent FDI player, though the real estate sector holds broader appeal across Asia and further afield. There will be some notable deals in HCMC during1h 2013 these will revive interest in Vietnam. Syndicated deals will become the norm for groups already present. Myanmar is a side show. CBRE Page 21

22 HCMC CONDOMINIUM U N S O L D S T O C K Leading Fund Manager HCMC Construction Department Other sources 35,000 unsold units 18,000 unsold units (NOT covering delayed projects) CBRE > 70,000 unsold units (HCMC+HN) Unit HCMC Sold vs. Unsold Condominium (Units) Total Unsold Total Sold 40,000 30,000 20,000 10, Source: CBRE CBRE Page 22 Unsold stock increased in 2011 BUT remained stable in 2012 Developers, in the majority, restrained (or were restricted) from launching product less pressure on unsold stock HCMC: 2,900 units sold in the primary markets in 2012 Hanoi: 5,000 units sold in the primary markets in 2012 Note: unsold stock, by CBRE s definition, is stock that have been launched by developers but unable to find buyers. This excludes stock offered on the secondary market (i.e. offered for sale by individuals) Source: CBRE discussions with representatives of developers and trading floors

23 HCMC CONDOMINIUM Y - O - Y P R I C E C H AN G E : - 6 % DISTRICT 12 Y-o-y Price Change CBRE Page 23-25% - -20% -20% - -10% -10% - -5% -5% - -0,2% -0,2% - 0,2% 0,2% - 5% 5% - 10% 10% - 20%

24 HCMC CONDOMINIUM AL T E R N A T I V E I N V E S T M E N T O P T I O N S Investment Option Stock Market (VN Index) 2012 Total Return 17.1% in 2012 (*); 21.5% for last 45 days Bank Deposit 12% down to 8% (**) Gold (SJC) 5.9% (***) Condominium 7% (****) Q4/2011 MOST favoured Real Estate CBRE Page 24 Q4/2012 attractive Very attractive Somewhat attractive Neutral Somewhat unattractive Very unattractive Education Oil, Gas & Natural Resources Real Estate Property Healthcare&Pharmaceuticals Manufacturing Agriculture Financial Services Retail Transportation and Logistics Hospitality and Leisure 0% 20% 40% 60% 80% 100% (*) VN Index change, 31 Dec 2012 against 2 Jan 2012 (**) For term deposit less than one year (***) Gold price per tael change in 31 Dec 2012 against 2 Jan 2012 Source: Grant Thornton Vietnam (****) (Capital variance between 2Jan2012 and 31Dec2012+ Annual Rental Income) / Capital Value

25 HCMC CONDOMINIUM GOVERNMENT S PROPOSED MEASURES TO SAVE THE MARKET CBRE Page 25

26 HCMC OFFICE AB S O R P T I O N & R E N T AL T R E N D S NLA (sm) Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q Grade A - Vacant 2012 Grade A - Net absorption 2013 Grade B - Vacant Grade B - Net absorption Grade A Rent Grade B Rent Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 $42.0 $35.0 $28.0 $21.0 $14.0 $7.0 $.0 Average Asking Rent (US$/sm/month) NET ABSORPTION Grade A Grade B Total ,016 97, , ,917 85, , ,209 39,921 64, Existing Space - GFA (sm) New Space Come Online Total GFA Source: CBRE CBRE Page 26

27 G r a d e A D i s t r i c t 1 HCMC OFFICE N E W S U P P L Y G r a d e B D e c e n t r a l i z e d President Place 9,100 sm Lim Tower 34,000 sm An Phu Plaza 10,905 sm The Vista 5,000 sm Empress Tower 20,000 sm Times Square 12,704 sm Saigon Airport Plaza 12,000 sm CBRE Page 27

28 HCMC RETAIL AB S O R P T I O N & R E N T AL T R E N D S GFA (sm) 140, , ,000 80,000 60,000 40,000 20, ,000 Net absorption-cbd Net absorption-non CBD Vacant space - CBD Vacant space - Non CBD Rent-CBD Rent-Non CBD Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q f $130 $80 $30 -$20 Asking rent (US$/sm/month) Source: CBRE CBRE Page GFA (sm) 111,090 85, ,331 Project Name -Parkson Paragon (D7) -Bitexco Financial Tower (D1) - The Crescent (D7) -The Vista (D2) - Vincom Center A (D1) - Pandora City (Tan Phu) -D1:Times Square - D2: The Estella, Thao Dien Pearl, Cantavil Premier -D7: Petroland Commercial and Financial Tower -Tan Binh: Pico Plaza, Saigon Airport Plaza -Phu Nhuan: Satra Eximland - Nha Be: Dragon Tower

29 Global reach, local expertise Unsurpassed connectivity and civic partnerships Highest caliber operations Customised client care programs Impeccable grounds and building environment Achievable real estate solutions Highest ethical standards Innovative CBRE tools and resources Robust procurement platform Global footprint Proactive client relations and retention Commitment to philanthropy Superior talent Personal touch Stringent quality control Performance and satisfaction benchmarking Fully integrated, comprehensive platform World-class services Unmatched connectivity Ambassadors of quality Financial integrity and accountability Superior sunstainability standards Community minded and charitable Building relationships, tracking trends Dynamic building management and communications Global excellence, local knowledge Proprietary General Management Council Thinking innovatively, but acting practically Unprecedented speed to market Performance and satisfaction benchmarking Unparalleled research capability Professionally trained staff Proprietary General Management Council Superior sunstainability standards Global reach, local expertise Unsurpassed connectivity and civic partnerships Commitment to confidentiality Highest caliber operations Proactive client relations and retention Commitment to philanthropy Superior talent Stringent quality control Global footprint Fully integrated, comprehensive procurement platform Ambassadors of quality Professionally trained staff Building relationships, tracking trends Commitment to confidentiality World-class services Unprecedented speed to market Thinking innovatively, but acting practically Global excellence, local knowledge Unparalleled research capability Superior talent CBRE Page 29

30 HCMC FEARLESS FOREC ASTS Capital Availability CBRE Page The burden of Non Performing Loans will be the dominant play in the newspapers in 2013, the on the ground reality will be different. Cash is king. 2. There is no knight in shining armour coming - denial will see many players isolated. Those who succeed will be those who roll up their sleeves and work hard, stay late. Evolution in the Real Estate Industry 3. Property is no longer just about bricks and mortar : When they eventually arrive Real Estate Investments Trusts will require the highest form of property investment sophistication and thus the market is set to require specialised due diligence expertise from both legal, tax and property service providers. The time for this transition and mindset is now. 4. Expectations of local developers/investors of service providers are aligning with those of international developers and investors. CBRE Inc will send more senior staff to Vietnam in 2013 enhance our service offering. On the ground CBRE will employ a greater number of qualified/certified staff as a % of our head count: Specialist in every sector. More RICS, more AAPI. More knowledge and experience

31 HCMC FEARLESS FOREC ASTS Investment & Development 5. Reduction in the number of listed Developers Like the number of active real estate funds, developers will halve in 2013 and halve again in 2014 before then rising again. 6. M & A activity to centre around re-structuring. It will be those who are well capitalised who are set to benefit in some cases it may be cheaper to buy a company than to buy a project. 7. HCMC to see number of real estate investment transactions increase. The number of significant transactions that occur in 2013 will be above that of From "If you build it, they will come" to "Now you have built, what are you going to do with it?" To "do not build it until you have an occupier and a competitive advantage". The era of speculative development is most definitely over. Green 9. What happened to LEED? Just because nobody s talking about it don t assume it isn t important the shift in direction continues to occur. CBRE Page 31

32 HCMC FEARLESS FOREC ASTS Residential Market 10. CBRE still believes that confidence is the key determinant for a turnaround even if the cost of borrowing continues to slide. Buyers will slowly come back to the market, though the bull run is unlikely to occur in As in the UK, the fall in resi prices enables record number of first time buyers in to the market as prices in some areas bottom out. Multi-generational housing to become less common as developers continue to recognise the true demand in the market and provide product that buyers can afford. 12. Vietnamese investors will consider residential investment properties in London and Sydney as well as Ho Chi Minh City. Commercial Occupier Markets 13. The largest office deals will occur in the Grade B market as tenants re-calibrate, re-locate and upgrade. Absorption in 2013, will increase on that seen in 2012, as the Vietnamese and regional economies recover. 14. Prime retail rents remain suffocatingly high as quality pitches remain rare. The prime demographic is slowly transitioning from window shoppers to actual shoppers, F & B operators the main beneficiary of this transition. 15. Retail Landlords go back to school and learn about project positioning as out of town vacancy reaches record highs. 16. Despite the difficulties, foreign retailers will come to Vietnam. Vietnam has 67.1m people below the age of 40. CBRE Page 32

33 HCMC FEARLESS FOREC ASTS And finally 17. Will anyone still have time for golf..? Marc Townsend in Falkland Islands (Malvinas) Mar-2012 CBRE Page 33

34 CBRE Global Office Locations 2013 CB Richard Ellis (Vietnam) Co., Ltd. This report has been prepared in good faith and with due care by CB Richard Ellis (Vietnam) Co., Ltd. We obtained some of the information above from sources we believe to be reliable. However, we have not verified the accuracy of the information which we obtained from other sources and make no guarantee, warranty or representation about it. We include projections, opinions, assumptions or estimates which are made with careful consideration of factors known to us for example only, and they may not represent current or future performance of the market. This information is designed exclusively for use by CB Richard Ellis clients, and cannot be reproduced without prior written permission of CB Richard Ellis. CBRE Page 34