binh duong market update, q3/2013

BINH DUONG MARKET UPDATE, Q3/2013
Presented by: Mr. Marc Townsend, Managing Director, CBRE Vietnam
Saturday, 21st September 2013
AGENDA
Binh Duong Market Updates
 Fact Sheet
 Snapshots
 Real Estate Overview
• Retail
• Industrial Parks
• Residential Leasing
• Condominium
– Where to buy in Binh Duong?
– Who to invest into?
– Why to buy in Binh Duong New City?
– Foreigner Housing Ownership
2
CBRE | BINH DUONG MARKET UPDATES
BINH DUONG FACT SHEET
Economic overview
Key Economic Indicators
Area (sq.km)
2,694.43 sq.km
Population (million persons)
1.7+ (2012)
Working population (mil. pers.)
~1.1 (2011)
Real GDP growth rate (%)
14% (Annual)
9.5% (6M/2013)
Registered FDI (US$ mil.)
Population ((Million persons)
Population and Labour Force, Binh Duong Province
2.0
12%
1.5
9%
1.0
6%
0.5
3%
0.0
501.2 (8M/2013)
Top in Vietnam Competitiveness Index for 5 years
Registered FDI, Binh Duong Province
2007
2008
Labour force
2009
Others
2010
2011
Population growth
Real GDP growth rate (%), Binh Duong Province
20%
2012
Q2/2013
Q
2011
2010
2009
2008
2007
2006
2005
0%
2000
2012
R i t
Registered
d FDI
5%
88M/2013
2011
2010
2009
2008
2007
2006
2005
2004
2003
$0
2002
$500
10%
2004
$1,000
,
15%
2003
$1,500
2002
$2,000
2001
GDP growth rate (%)
$2,500
2001
Registered F
FDI (Million USD)
0%
2006
Real GDP growth rate
Source: Vietnamese General Statistics Offices,
Binh Duong Statistics Office
3
CBRE | BINH DUONG MARKET UPDATES
ECONOMIC UPDATES
FDI continues to grow
Accumulative
registered FDI
HCMC
No. of
projects
Total registered FDI
(US$ mil.)
4,576
33,327.52
290
26,353.22
Hanoi
2,550
21,663.65
Binh Duong
2,296
18,570.16
Dong Nai
1,128
18,416.92
Ba Ria - Vung Tau
Valid accumulative FDI (project), 8M/2013
Top 3 nation-wide
2.7%
10.4%
Top 4 nation-wide
HCMC
42.2%
21.2%
Valid accumulative FDI (US$ million), 8M/2013
15.6%
Hanoi
Binh Duong
HCMC
28.2%
Hanoi
15.7%
Dong Nai
23.5%
Ba Ria - Vung Tau
Binh Duong
Ba Ria - Vung Tau
18.3%
22.3%
Dong Nai
Source: Vietnamese General Statistics Offices
4
CBRE | BINH DUONG MARKET UPDATES
 Metro Cash & Carry
 Eastern International University
 Hanh Phuc International Hospital
 Dai Nam Park
 Co.op Mart Binh Duong
 KinderWorld Int’l Kindergarten
 Columbia Asia Int’l Hospital
 Song Be Golf Resort
 Big C Supercentre
 Singapore International School
 Binh Duong General Hospital
 Twin Doves Golf Club
5
 Citimart Binh Duong
CBRE | BINH DUONG MARKET UPDATES
 Vietnamese German University  Binh Duong Traditional Medicine Hospital  Thanh Le Cultural Park
BINH DUONG SNAPSHOT
A bright spot?

40 metres above sea level >> no flood, no earthquake

Good connectivity:
• National Highway 13, Trans-Asia Highway
• My Phuoc - Tan Van Expressway: Slow but steady
• Proposed tramway system in downtown

Social infrastructure:
 Retail: Metro, Big C, Lotte, Aeon
KinderWorld International Kindergarten
Kindergarten,
 School:
Eastern International University, Singapore
International School
 Hospital: Hanh Phuc Hospital, Eastern International
General Hospital
 Leisure: Song Be Golf Resort, Twin Dolves Golf Club,
Dai Nam Park, TiniWorld
 Notable residential projects: SORA gardens, The
Oasis, Ecolakes, Horizon, TDC, IJC Aroma, Charm
Plaza, EcoXuan
HSBC, BIDV
BIDV, Vietcombank,
Vietcombank Eximbank,
Eximbank etc.
etc
 Banking: HSBC
6
CBRE | BINH DUONG MARKET UPDATES
BINH DUONG REAL ESTATE OVERVIEW
Some residential developers are still spending...
Advertised by Month, Southern Vietnam*, Mar-Sep 2013
Advertised by provinces, Southern Vietnam*, Mar-Sep 2013
30
150
12
60
25
125
10
50
20
100
8
40
15
75
6
30
10
50
4
20
5
25
2
10
0
0
0
Mar
Apr
May
Jun
Number of advertisements
Jul
Aug
Sep
Number of projects
0
Binh Duong
Dong Nai
Number of advertisements
Vung Tau
Number of projects
(*): HCMC, Binh Duong and Dong Nai, BR-VT
Source: CBRE, tracked from Tuoi Tre; Mua & Ban; Tap chi Bat Dong San (Property Magazine);; Thanh Nien; Nhip Cau Dau Tu; Doanh nhan Sai Gon;
Saigon Times Daily; Vietnam Investment Review; Vietnam News.
Some developers increased their advertising
spending. Apart from HCMC, Binh Duong
topped the list with eight projects having
advertised since March 2013
2013.
7
CBRE | BINH DUONG MARKET UPDATES
BINH DUONG REAL ESTATE OVERVIEW
Those who can deliver
SORA gardens 1
 Scale: 404 units (phase 1)
 Price: from VND19 million/sm
St t
Construction
C
t ti att full
f ll
 Status:
pace to Floor 3 after 3 months
 Exp. completion: Q4/2014
Eastern Int’l General Hospital
 Scale: 1,000 beds
 Exp. completion: 2013
TDC Plaza
 Scale: 340 units (phase 1)
 Price: from VND19 million/sm
 Status: Handed-over in mid-July
Big size units remained for sale.
Charm Plaza
 Scale: 404 units
 Price: from VND17 million/sm
 Status: Handing over
Lotte Mart Binh Duong
 Scale: 17,400 sm NLA
 Exp. completion: 2014
AEON Binh Duong
 Scale: 62,000 sm GFA
 Exp. completion: 2014
8
Binh Duong’s Political &
Administrative Center
 Status: Under construction
 Exp. completion: Q1/2014
CBRE | BINH DUONG MARKET UPDATES
BINH DUONG REAL ESTATE OVERVIEW
vs. those who cannot…
Binh Duong
g revoked 7 slow-paced
p
real estate project
p j
licenses
Binh Duong real estate: wasting the huge expat demand
9
CBRE | BINH DUONG MARKET UPDATES
BINH DUONG RETAIL
Foreign brands to come
Retail space per capita by province
HCMC
Binh Duong
Dong Nai
BR-VT
sm/person -
0.02
0.04
0.06
Retail supply, Binh Duong Province
Source: CBRE
200,000
,
GFA (sm)
150,000
100,000
50,000
0
2010
Supermarket
10
2011
2012
Shopping Centre
Others
2013f
2014f
Future Supply
CBRE | BINH DUONG MARKET UPDATES
BINH DUONG INDUSTRIAL PARKS
A Momentum for Development Growth

Part of the Southern
K Economic
Key
E
i Z
Zone

30 operational IPs

Total GFA: 9,073 ha

222,460 employees

Top 5 manufacturing
industries:
• Food processing
• Furniture production
• Metal bars
• Chemicals
• Metal products
ASCENDAS
Industry is the main
driving force for the
industrialisation
and modernisation
from now till 2020.
11
CBRE | BINH DUONG MARKET UPDATES
BINH DUONG RESIDENTIAL LEASING
Currently thin market, lack of facilities & nightlife spots
Rental Trends, Binh Duong Serviced Apartment vs. HCMC Buy-to-let Condo (US$/sm/month)
Buy-to-let - D.1, HCMC
Buy-to-let - D.7, HCMC
$50
$40
$30
$20
$10
$$0
Q1
Q2
Q3
Q4
Q1
Q2
2009
Q3
Expatriates working
in Binh Duong
prefer a VIBRANT
LIFESTYLE
in HCMC.
Who can
provide this
in Binh Duong?
Buy-to-let - D.2, HCMC
Serviced Apartment - Binh Duong
Q4
Q1
2010
Q2
Q3
Q4
Q1
2011
Q2
Q3
2012
Q4
Q1
Q2
Q3
2013
Source: CBRE
5,200+ expats
vs.
146 serviced
i d apts. &
2,092 buy-to-let condos &
834 hotel rooms
Most of the local IP-based expatriates lease accommodations in HCMC
(20km away) due to the lack of:
•
Daily-life facilities such as a shopping destination, swimming pool,
tennis court and gymnasium;
•
Night-life venues such as restaurants, bars, clubs, etc.;
•
Educational and healthcare centres;
•
And limited fully
fully-furnished
furnished accommodation options in the province.
province
Source: CBRE, Binh Duong IZs Authority, VSIP1&2
12
CBRE | BINH DUONG MARKET UPDATES
BINH DUONG CONDOMINIUM
Condominium overview
Existing Supply v.s. New Supply, Binh Duong Province
Unit Type, Binh Duong Province
4,000
1BR
3,500
100%
3,000
80%
s
Units
2,500
2BR
3BR
4BR
Penthouse
60%
2,000
40%
1,500
New
Supply
1,000
20%
0%
500
2014f
2013f
2012
2
2011
1
2010
0
2009
9
2008
8
2007
7
2006
6
2005
5
0
The
The
New Sunrise Sunrise
IJC
TDC Charm
Canary - Canary - Horizon Block C Block D Aroma Plaza Plaza P1
P2
Block D (Block
(
P1
E)
Existing
g
Supply
Condominium Clusters, Binh Duong Province
Thuan An
Price (US
S$/sm)
“
$1 500
$1,500
New completions increased ~19% y-o-y.
The most sought-after type is 2BR.
Binh Duong New City offers more
reasonable price with better quality
quality.
”
SOURCE: CBRE RESEARCH & CONSULTING
$1,000
Binh Duong
New City
Thu Dau Mot
$500
Di An
$0
Source: CBRE
1
2
3
4
5
6
Quality of Condominium Products
13
CBRE | BINH DUONG MARKET UPDATES
High security
WHERE TO BUY IN BINH DUONG?
Clean and f resh air
Af f ordable housing products
Good inf rastructure
 Ranking of locations:
Good connection with HCMC
Good f or business
Rank
Preferred location by
b buyers
b ers
1
Binh Duong New City
2
Thu Dau Mot
3
Thuan An
Bi h D
Binh
Duong N
New Ci
City
4
Di An
Thuan An
5
Ben Cat
Comprehensive development planning
Centralised government
Residents with good community spirit
G d education
Good
d
ti environment
i
t
Thu Dau Mot
Good healthcare f acilities
Abundant greenery space
Di An
Ben Cat
Premium-quality
Premium
quality residential options
Source: CBRE
1 2 3 4 5
Project launched since 2008 by foreign developers, with a scale of 400–
1,500 units and a political - administrative centre located in a township
Projects launched since 2008 by foreign developers, with a scale of 400–
1,500 units and located in a township
Projects launched since 2008 by foreign developers, with a scale of 400–
1,500 units
Projects launched since 2008 by foreign developers
Projects launched since 2008 (excluding affordable project)
“
SORA gardens is the ONLY
project located in a township
which boasts the political &
administrative headquarter
of the province. Other
townships (PMH, Celadon
City in HCMC; Linh Dam,
Ciputra, Van Quan in Hanoi)
do not have a provincial
administrative centre inside.
”
CBRE RESIDENTIAL PROJECT MARKETING
14
CBRE | BINH DUONG MARKET UPDATES
WHO TO INVEST INTO?
Brands – a way to categorize
 Can apply
pp y to p
property
p y developers,
p
construction/property
p p y management
g
companies
p
 Helps to quickly and easily identify a property/service
 Sets levels for quality & standards
 International/national
I t
ti
l/ ti
l visibility
i ibilit & product
d t kknowledge
l d
 Enhances value
Residential Developers/Contractors
15
CBRE | BINH DUONG MARKET UPDATES
WHY TO BUY IN BINH DUONG NEW CITY?
A mid- to long-term vision: the best quality of life for your children
Binh Duong New City - A well-planned town that is

Close to HCMC

With fresh air, abundant greenery, large roads, etc.

With quality housing products and social infrastructure such as
schools, hospitals, retail centres, restaurants and bars, etc.
S i
Saigon
S
South,
th 1995
15 years ago, no one believed
in Phu My Hung’s vision.
Phu My Hung, 2013
16
CBRE | BINH DUONG MARKET UPDATES
LEGAL UPDATES
More opportunities for foreigners to buy houses in VN
Current Law
(Resolution No.19, effective 2009 - 2013)
Foreign
Individual
Buyers
YES with restrictions such as:
• Individual investors who make direct investment
Proposed Amended Law
(effective 2014 IF approved)
YES for all foreigners who have a visa to the country
that is valid for at least three months
in Vietnam;
• Expatriates at managerial positions;
• Individuals who possess special skills that are
needed in Vietnam;
• Individuals who are married to Vietnamese
citizens;
Foreign
g
Organisations
ONLY foreign-invested
g
companies
p
operating
p
g in
Vietnam which are not in the real estate business
but have the need to provide accommodation to their
employees.
YES to all foreign
g investment funds, banks, Vietnamese
branches and representative offices of overseas
companies.
Sub-lease
NO
YES
Product
Apartments only.
Apartments + landed property (less than 500 sm)
Number of
Product
One unit only
For individuals:
• Option 1: Unlimited
• Option 2: Limited to one or two
For organisation:
• Depend on the number of foreign employees it has
Maximum Lease
Term
• Option 1: 50 years with the possibility of another 50-
50 years
year extension;
• Option 2: 70 years with no extension.
17
CBRE | BINH DUONG MARKET UPDATES
LEGAL UPDATES
Foreigners to buy houses - Regional comparison
Thailand
Singapore
YES with some restrictions:
 Holding a residency permit under Thai Immigration law.
 Permitted to stay in Thailand under the Investment
Promotion law (BIO)
 A foreigner or foreign entity remitting a foreign currency into
Thailand or withdrawing money from Thai Baht account of
Thailand,
the persons residing abroad, or withdrawing from foreign
currency account
YES Some
S
iimportant notes:
 They have to pay an additional buyer's stamp duty
(ABSD) on the higher of the total purchase price or
market valuation.
 Only citizens and Permanent Residents of some
countries which have signed free trade agreements
(FTAs) with Singapore are exempted from ABSD.
Sublease
YES
YES for condo only
Foreign
Organisation
YES with
ith some restrictions:
t i ti
 Only joint-venture between a foreign and a local company
with at least 51% of share held by Thai
 Foreign juristic entity in receipt of a promotion certificate
under the Investment Promotion Law.
YES with higher ABSD rate
Product
Condominium: as long as the building has not already sold its
49% foreign quota.
Condominium of a six- or more- storey.
Landed house with condition:
 Approval from the Controller of Residential Property
 For accommodation purpose only.
Number of
Product
N/A
 Condominium: unlimited but a single foreign party
cannot buy all units in a condominium development
without prior approval.
 Landed house: 1
Maximum
Lease Term
30 years with another 30-year extension
99-year lease
Foreign
Individual
Buyers
18
CBRE | BINH DUONG MARKET UPDATES
LEGAL UPDATES
A turning point of a maturing market
“
Like first time buyers, retirees, up-graders,
Vietnamese overseas and newly married
couples; foreigners should be seen as a
logical extension of a maturing market, not
just a quick fix.
”
SOURCE: MS. DUNG DUONG, ASSOCIATE DIRECTOR,
CBRE RESEARCH & CONSULTING
19
CBRE | BINH DUONG MARKET UPDATES
At CBRE, we live and breathe
the business of real estate
Every week – NEWSPAPER UPDATES
E
Every
month
th – DASHBOARD
Every quarter – QUARTERLY REPORT
For more information regarding this presentation please contact:
MARC TOWNSEND
Managing Director
T + 84 3824 6125
F +84 3823 8418
[email protected]
© 2013 CBRE (Vietnam) Co., Ltd. This report has been prepared in good faith and with due care by CBRE (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 CBRE clients, and cannot be reproduced without prior written permission of CBRE.