Vietnam Property Intelligence Centre (VPIC)

Market Brief | Q3 2023

Mixed picture for property

market
2 | Economic Backdrop | Vietnam JLL Vietnam Market Brief – Q3 2023

Major Economies

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

Indicators 3Q23 Key features
(%) (%)

GDP growth
▲ 5.33 ▲ 3.04 Vietnam’s GDP in 3Q23 was estimated to increase by
5.33% y-o-y, recorded positive signs compared to the first
2 quarters of 2023. Overall, GDP in the first 9 months of
2023 increased by 4.23%, which was the third lowest first
9 months growth in the period of 2011-2023.

CPI
▲ 2.89 3Q23 CPI reached an y-o-y increase of 2.89%. On average,
in the first 9 months of 2023, CPI increased by 3.16% over
the same period in 2022.

Retail Sales growth

▲ 7.30 ▲ 1.90 Total retail sales of consumer goods and services reached
1,550.2 trillion VND, up 1.9% q-o-q and 7.3% y-o-y.
Generally, for the first 9 months of 2023, total retail sales
at current prices was 4,567.8 trillion VND, up 9.7% over the
same period last year.

Registered FDI
▲ 71.52 ▲ 22.95 Registered FDI in 3Q23 was recorded at USD3.74 billion,
surged by 71.52% y-o-y and 22.95% q-o-q. On average,
the total FDI registered reached USD10.23 billion in 9M23,
increasing 43.65% y-o-y.

International Tourist Vietnam welcomed nearly 8.9 million international

Arrivals
▲ 160.48 ▲ 15.13 tourists in the first nine months of 2023, exceeding the
government's full-year forecast of 8 million. However, this
was still only 69% of the number of tourists who visited
Vietnam in the same period in 2019, before the COVID-19
pandemic.

Rental/Price Property Clock, 3Q23

Northern, Southern RBL

Southern, Northern RBW
HCMC, Hanoi Apartment

Growth Rent/Price
Slowing Falling

Hanoi Office

Rent/Price Decline
HCMC, Hanoi, Danang Hotels
Rising Slowing
HCMC Office
HCMC, Hanoi Retail

Source: GSO, FIA, JLL Research

Note: Clock positions for the sector relate to the main submarket in each city/region.
3 | Market Insights | Ho Chi Minh City | JLL Vietnam Market Brief – Q3 2023

Office Market

“ Thu Thiem welcomes two first

Grade A buildings, establishing a
new gravity area for city office
Rental Growth y-o-y
+0.8%
sqm per month,
net effective on NFA
USD 31.1
Stage in Cycle
Stable
market.

Financial Indicators Net absorption increases, driven by new leases in new projects
• In 3Q23, leasing transactions for Grade A office spaces in Thu Thiem led the
115 market demand, thanks to proactive pre-leasing activities from two newly
completed projects. The banking and financial sectors, particularly occupiers
110
seeking green-certified workspace upgrades, were the main contributors to the
positive absorption of these two newly completed projects in this quarter.
105
• Grade B office space experienced a net absorption of about 4,200 sqm in 3Q23.
Index

100 Noteworthy absorption was recorded at locations with new buildings. However,
most of the existing buildings faced challenges in filling vacant space due to
95
weakened demand and interest.
90 The first Grade A green buildings in Thu Thiem
4Q18 4Q19 4Q20 4Q21 4Q22 4Q23
• In 3Q23, HCMC's Grade A office market saw the additions of the two new
Dotted line indicates near-term outlook
Index base: 4Q18=100
buildings introduced in Thu Thiem: The Hallmark (54,500 sqm) and The Mett
Financial Indicators are rental value index for Grade (30,333 sqm). This marks new Grade A green-building standards just across the
A&B Office and For lease properties. river adjacent to the Central Business District (CBD).
Source: JLL Research
• In Grade B segment, newly renovated The Waterfront Saigon building added
Physical Indicators 5,794 sqm of inventory in the CBD area. In the Non-CBD area, the 43-45 Thao Dien
building introduced 7,180 sqm to the market. These developments increased
200 99% HCMC's Grade B office supply by 1.1% q-o-q, reaching 1,198,950 sqm.
180
160 96%
Average Grade A rental rates adjusted slightly lower as new projects
140 93% offer favourable leasing terms
Thousand sqm

120
100 90%
80 • In the CBD, Grade A rents dropped slightly 3.9% q-o-q, mainly due to interest in
87%
60 the earlier mentioned new projects that have lower-than-average rents.
40 84%
20 • Grade B office buildings also saw slight rents increase, indicating that overall
0 81%
2018 2019 2020 2021 2022 2023
market interest for Grade B space is still positive. Overall, the average net effective
New Supply Future Supply rent for Grade B spaces in HCMC was USD 26.1 per sqm per month, showing a
Occupancy Rate (RHS) slight 0.1% q-o-q increase.
For 2018 to 2022, new supply and occupancy rate Outlook: Grade A supply growth increases competition among
are year-end annual. For 2023, new supply and
occupancy rate are as at 3Q23. Future supply is for existing buildings
the remainder of 2023.
Physical Indicators are for Grade A&B Office and For • Competition in the office market will rise in 4Q23 and early 2024 due to new
lease properties. projects to include The Nexus in the CBD and E.Town 6 in the Airport area. The
Source: JLL Research focus on developing offices that meet international Grade A and green building
standards will continue, meeting the needs of tenants aiming to enhance their
office spaces for both sustainability goal and also to meet local business and
employees’ requirements.
• In a challenging economy, HCMC remains a core focus for MNCs as the market
has seen recent MNC expansion activities. With new imminent supply, market
which has been heavily landlord-favourable will turn towards a more neutral
market in the short and medium term.

Note: CBD area refers to District 1, part of District 3 (within CBD 1km radius) and Thu Thiem.
Please prefer to Terminology for detailed classification.
4 | Market Insights | Ho Chi Minh City | JLL Vietnam Market Brief – Q3 2023

Retail Market

“ Prime malls are showing

strong performance, with
rents continuing to rise.
Rental Growth y-o-y
+0.4%
sqm per month,
net effective on NLA
USD 42.8
Stage in Cycle
Rent Rising

Financial Indicators Fashion and Lifestyle sectors drive new lease demands
• Thiso Mall has experienced strong demand this quarter, with notable new leases
120 including Hidden Castle Golf Club, Glamourista and Adidas. The leasing demand
100
has particularly increased in the Fashion and Lifestyle sectors.

80
• Limited vacant space in Prime malls in City Center has restricted new lease
transactions. However, Prime malls in the City Fringe have maintained stable net
absorption, although with fewer large transactions compared to the previous
Index

60
quarter. Overall, the total net absorption for the entire market in 3Q23 was
40
modest, at 610 sqm.
20
Stable leasing demand lower vacancy rates in the City Fringe
0
4Q18 4Q19 4Q20 4Q21 4Q22 4Q23 • In 3Q23, no new supply was added, keeping the total supply of Prime Malls in
both submarkets at 576,862 sqm. Hung Vuong Plaza's renovation is on schedule
Dotted line indicates near-term outlook
Index base: 4Q18=100
for a planned launch in 4Q23, while Vincom Mega Mall Grand Park is expected to
Financial Indicators are rental value index for Prime open in the first half of 2024. Both malls are actively pre-leasing in the market.
malls
Source: JLL Research • The City Centre's vacancy rate remained at 1.2% in 3Q23, with an additional 300
sqm of vacant space due to the withdrawal of underperforming tenants at
Physical Indicators Vincom Centre B. The City Fringe saw a reduced vacancy rate of 3.8%, driven by
stable leasing demand, decreasing by 0.2% q-o-q and 4.1% y-o-y.
140 98%
97% Average rents uptick marginally
120
96%
100
95%
• In the City Centre, Prime malls saw a slight increase in net effective rent to USD
Thousand sqm

80 94% 82.7 per sqm per month, a 0.1% q-o-q rise. Despite economic uncertainties
60 93% affecting luxury spending, these premium premises continued to attract major
92%
40 brands for brand promotion and marketing, thanks to their high-visibility spaces.
91%
20 90% • In the City Fringe, net effective rent remained steady at USD 36 per sqm per
0 89%
2018 2019 2020 2021 2022 2023
month, with no significant fluctuations from the previous quarter. Property
New Supply Future Supply developers have been actively working to improve occupancy rates and foot
Occupancy Rate (RHS) traffic by consistently pricing rent and strategically replacing underperforming
For 2018 to 2022, new supply and occupancy rate retail spaces with more promising brands.
are year-end annual. For 2023, new supply and
occupancy rate are as at 3Q23. Future supply is for Outlooks: Prime malls continue to maintain strong performance
the remainder of 2023.
Physical Indicators are for Prime malls • Net absorption is expected to keep increasing in Prime Malls within the City
Source: JLL Research Fringe, particularly in the upcoming malls set to open in the near future. It is
estimated that around 50,000 sqm of leasable space could be absorbed, based
on the positive pre-leasing rates currently being observed.
• The F&B, Fashion, and lifestyle industries are anticipated to continue being the
main drivers of demand. The stable tenant base and consistent visitor foot traffic
in Prime malls are expected to contribute to the continuous growth of net
effective rent.

Note: City Centre refers to District 1 and District 3.

Please prefer to Terminology for detailed classification.
5 | Market Insights | Ho Chi Minh City | JLL Vietnam Market Brief – Q3 2023

Hotel Market

“ Strong domestic demand

sustains a stable growth in
HCMC trading performance.
YTD RevPAR
Growth y-o-y
+78.6%
YTD RevPAR
USD 71.6
Stage in Cycle
RevPAR Rising

Financial Indicators Tourism continues to improve, led by a significantly strong

domestic demand base
140 • Close to a total of 12.2 million tourists visited HCMC in the third quarter 2023,
120 leading to 30.6 million tourists since January. Domestic tourism continues to
form the main driver of the demand as it represented almost 88% of the tourists.
100
Gradual improvement in airlift is expected to draw a higher proportion of foreign
80 visitation to the city in the near term.
Index

60
• Additionally, tourism turnover has demonstrated a notable increase over the
40 past nine months, totalling over VND 125 trillion, exceeding the total turnover for
20 2022 and achieving 78% of the 2023 target set by the government.
0 One notable hotel opened in Q3 2023
4Q18 4Q19 4Q20 4Q21 4Q22
• Only one notable hotel completed in the third quarter: the Sotetsu Grand Fresa
Dotted line indicates near-term outlook
Index base: 4Q18=100
Saigon Hotel, located in District 1. This new midscale hotel adds 125 keys to the
Financial Indicators are RevPAR index existing hotel supply, dominated by the upscale and midscale segments.
Source: STR
• Given the ongoing economic challenges, including high development costs,
limited availability of prime land plots and unresolved legal procedural
Physical Indicators obstacles, future hotel supply in the city remains limited: only the 250-key Hilton
Saigon is scheduled to complete by the end of the year.
4 80%
70%
Gradual increase in RevPAR
3
60%
3 • As of YTD September 2023, hotels in HCMC have registered a gradual increase in
Thousand rooms

50%
2 trading performance, leading to a RevPAR of c. USD 72. This represents a
40%
2
30%
significant rise of more than 78% from 2022, however still below pre-pandemic
1 20%
by 11%.
1 10%
• Average Daily Rate (ADR) of USD 112 in the first nine months have improved
0 0%
2018 2019 2020 2021 2022 2023
from last year, yet registering a lower growth than occupancy with close to +21
New Supply Future Supply percentage points year-on-year.
Occupancy Rate (RHS)
Outlook: Closing the gap with pre-COVID performance in 2024
For 2018 to 2022, new supply and occupancy rate
are year-end annual. For 2023, new supply and • In the year ahead, the limited future supply in HCMC coupled with an anticipated
occupancy rate are as at 3Q23. Future supply is for
rebound in tourist arrivals should enable occupancy to continue increasing
the remainder of 2023.
Source: JLL Research marginally, with ADR levels to gradually close the gap with 2019 levels.
6 | Market Insights | Ho Chi Minh City | JLL Vietnam Market Brief – Q3 2023

Apartment Market

“ Positive sales and launches

recorded in one large-scale project
support the market performance in
the quarter.
Price Growth y-o-y
-5.3%
Primary Price on NFA
USD 3,230
Stage in Cycle
Growth Slowing

Financial Indicators Developers offer several incentives to stimulate cautious demand

• New supply soaring resulted in high sales volumes of 3,800 units sold recorded
250 this quarter, increasing 192.7% q-o-q, with the major contribution from
Vinhomes Grand Park township. Transactions mainly focused on the newly
200
launched Glory Heights phase thanks to flexible payment methods and policies
from a reputed developer, while most of the inventories from the remaining
150
projects witnessed a decline in transaction volume.
Index

100 • Besides, amid the rising concern about the handover ability of ongoing project,
many developers try to demonstrate their commitment to handover on schedule
50
and extended payment terms for near-to-finished projects to attract buyers.
0 Subsequent phase from a large township dominates new supply
4Q18 4Q19 4Q20 4Q21 4Q22 4Q23
• In 3Q23, the official new supply surged by 317.3% q-o-q but down by -28.2% y-o-
Dotted line indicates near-term outlook
Index base: 4Q18=100
y, contributing to 4,686 units. The surge of new unit launches accelerated during
Financial Indicators are average primary price index the quarter, primarily due to the introduction of the Glory Height phase of
for all grades - Ultra-Luxury, Luxury, Premium, Mid- Vinhomes Grand Park (District 9), which accounted for 67.5% of the total new
end and Affordable segment
Source: JLL Research
launches in the HCMC market. The remaining units came from projects that had
undergone long soft launching periods before receiving permits to sign SPAs,
Physical Indicators such as Urban Green (Thu Duc) or De La Sol (District 4).
40 100% • In contrast, other developers were still cautious about launching new sales due
35 to weak market sentiment and focused on accelerating construction progress to
98%
30 hand over on schedule instead.
Thousand sqm

25 96%
20 The selling price remains stable in the context of limited supply
15 94%
10
• Primary prices remained stable at USD 3,230/sqm, with a slight 0.4% q-o-q
92%
5 decrease. The decline in price growth was mainly attributed to certain projects
0 90% offering attractive policies for remaining inventories and welcoming newly-
2018 2019 2020 2021 2022 2023 launched projects at lower than the average market. Meanwhile, other projects
New Supply Future Supply maintained stable asking prices.
Sale Rate (RHS)

For 2018 to 2022, new supply and sale rate are year- • For some projects in the High-end segment, with limited new supply at prime
end annual. For 2023, new supply and sale rate are locations and having clear legal status, the primary price was recorded to
as at 3Q23. Future supply is for the remainder of increase from 4-5% compared to the first launch phase.
2023.
Physical Indicators are for all grades - Ultra-Luxury, Outlooks: Restricted supply and modest demand to persist
Luxury, Premium, Mid-end and Affordable segment.
Source: JLL Research • The market is expected to welcome about 2,800 – 2,900 units in 4Q23, making
the total 2023 supply of 15,200 units, equivalent to the new supply in 2022.
• Demand is forecast to move in tandem with new supply and remain at the
current low level. Besides, high-interest rates will put highly leveraged investors
on the sideline while long-term investors with lower debt levels, idle-capital
holders, and owner-occupiers remain active.

Note: CBD refers to District 1, part of District 3 (within CBD 1km radius) and Thu Thiem
Please prefer to Terminology for detailed classification.
7 | Market Insights | Southern | JLL Vietnam Market Brief – Q3 2023

Ready-built Landed Property Market

“ Ecopark’s first-time project

launch in the South grabs
market attention.
Price Growth y-o-y
+16.1%
Primary Price on Land
USD 4,881
Stage in Cycle
Growth Slowing

Financial Indicators Transaction volume continues to slow

• Due to the constraints of new supply and the prolonged cautiousness of buyers,
250 HCMC market recorded a limited number of transactions, with only 32 units sold
(down 94.8% y-o-y) and a sales rate of just 8.5% in 3Q23. Primary stock was
200
mainly inventory that had high transaction values (over USD 1 million/unit),
making them less liquid and affecting the quarterly sales rates.
150
• Greater HCMC provinces recorded 1,083 units sold (up 2.9% y-o-y), yet the
Index

100 majority was transacted in booking phase long time ago, accounting for around
85% of the total take-ups.
50
Dong Nai market returns quite active after a low time
0
4Q20 4Q21 4Q22 4Q23 • The market in HCMC recorded no new supply in 3Q23. The primary cause was
that developers tended to delay new project introductions due to the market
Dotted line indicates near-term outlook
Index base: 4Q20=100
downturn. Additionally, there was stagnation in legal procedures and the
Financial Indicators are primary price index for all construction progress of projects that had been soft-launched but did not
types - Villas, Townhouses and Shophouses. qualify yet for the SPA signing stage.
Source: JLL Research
• In Greater HCMC provinces, new supply increased by 56.7% y-o-y, with 1,189
Physical Indicators units that were able to sign SPA contracts. Most of the new supply came from
projects that have been soft-launched in 2021-2022 period in Dong Nai and Long
10 100.0% An. Highlight of the quarter is the official launch of 68 units in Eco Village Saigon
9 River (Nhon Trach), which owns new and interesting concept (Blue-zone living
8 98.0%
7 area, Onsen villa) and have been conducting many vibrant marketing activities.
Thousand sqm

6 96.0%
5 Primary selling prices remains stable
4 94.0%
3 • The average primary price in HCMC remained stable at USD 14,979 per sqm land
2 92.0%
1
(down 0.1% q-o-q), with some projects implementing incentives to stimulate
0 90.0% sales.
2020 2021 2022 2023
New Supply Future Supply • Meanwhile, the average primary selling price in Greater HCMC increased by
Sale Rate (RHS) 10.7% q-o-q to USD 2,097per sqm land, as most of the new supply were sold at
For 2020 to 2022, new supply and sale rate are year- higher-than-average prices. However, some properties have been sold with
end annual. For 2023, new supply and sale rate are lower profit margin to trigger transactions, resulting in the slight decline of
as at 3Q23. Future supply is for the remainder of secondary price in 3Q23, down 0.6% q-o-q.
2023.
Physical Indicators are for all types - Villas, Outlooks: Price growth to compress further in the near term
Townhouses and Shophouses.
Source: JLL Research • The government is putting efforts into stabilizing the economy; however, these
efforts typically take time, and 2023 is considered a transition period. Therefore,
the total year-end new supply in the region is set to reach 2,300 units, a record-
low level in the past 10 years.
• Selling prices are expected to remain resilient backed by limited new supply.
However, the price growth rate will continue to be impeded by fragile market
sentiment.

Note: Southern area consists of HCMC, Binh Duong, Dong Nai, Ba Ria – Vung Tau and Long An markets.
8 | Market Insights | Southern | JLL Vietnam Market Brief – Q3 2023

Ready-built Warehouse Market

“ Positive demand is recorded,

strongly driven by domestic
demand.
Price Growth y-o-y
+3.5%
sqm per month,
net asking on GFA
USD 4.7
Stage in Cycle
Growth Slowing

Financial Indicators Positive demand is recorded after previous subdued quarters

• The Southern logistics market entered the last quarters of the year with positive
160 net absorption of approximately 86,000 sqm recorded after previous subdued
140 quarters. Newly signed leases were continued expansions from existing
120 manufacturers, 3PLs, and e-commerce.
100 • Domestic consumption remained to be the main driving force to sustain market
sentiment. Most new leasing activities have been taking place at Modern RBW
Index

80

60 facilities that were long completed . Meanwhile, recently completed warehouses,

40 especially in remote locations, are still facing high vacancy rates, implying longer
20
void time for new completions to fill up the space.
0 New project is officially launched in Long An
4Q18 4Q19 4Q20 4Q21 4Q22 4Q23
• After a quiet quarter, the Modern RBW market in 3Q23 recorded roughly 38,000
Dotted line indicates near-term outlook
Index base: 4Q18=100
sqm of newly completed logistics space, coming from phase 2 of the SLP Park
Financial Indicators are rental value index for Xuyen A project, Long An. The completion of a new logistics facility has promoted
Modern warehouses and For lease properties. SLP into the top 3 investors with the largest market share in the South, following
Source: JLL Research
BWID and Mapletree. These two developers maintain with total current scale
accounting for more than 53% of total Modern RBW market size.
Physical Indicators
Average asking rent remains at a stable level
800 100%
700 90% • Modern RBW rent was generally stable at USD 4.68 per sqm per month, only a
600
80% slight increase of 0.5% q-o-q and 3.5% y-o-y. Demand-stimulating strategies,
70%
most in form of longer rent-free periods, have been applied by landlords to
Thousand sqm

500 60%
400 50% enhance asset performance.
300 40%
200
30% • Notably, a number of projects experiencing a gloomy leasing situation since their
20%
100 10%
official launch have reduced asking rents by about 2 - 4% to strengthen
0 0% competitiveness and attract potential tenants.
2018 2019 2020 2021 2022 2023
New Supply Future Supply Outlooks: Flexible leasing terms is expected, especially in new
Occupancy Rate (RHS) projects, to cope with challenging market
For 2018 to 2022, new supply and occupancy rate • In the last 3 months of 2023, the Southern area is expected to welcome over
are year-end annual. For 2023, new supply and
occupancy rate are as at 3Q23. Future supply is for 460,000 sqm of Modern RBW entering the market, developed by BWID, LOGOS,
the remainder of 2023. Emergent Capital Partners and Cainiao. By the end of 2023, the market size will
Physical Indicators are for Modern warehouses and be expanded up to 2.3 million sqm, an increase of nearly 1.3 times compared to
For lease properties.
Source: JLL Research the current scale.
• In the short term, the logistics market dynamics will continue to be driven by
domestic demand while demand from cross-border trade activities are expected
to show signs of recovery, albeit at a slow pace, by late next year. Landlords
continue to cope with the challenges by offering more flexible and attractive
leasing terms to improve asset performance.

Note: Southern area consists of HCMC, Binh Duong, Dong Nai, Ba Ria – Vung Tau and Long An markets.
9 | Market Insights | Hanoi | JLL Vietnam Market Brief – Q3 2023

Office Market

“ Market constraints arise in the

face of subdued demand and
high competition.
Rental Growth y-o-y
-2.2%
sqm per month,
net effective on NFA
USD 18.9
Stage in Cycle
Rent Falling

Financial Indicators Banking and Insurance major tenants drives market demand
• In 3Q23, Grade A net absorption rose sharply, mainly due to substantial
120 transactions from banking and insurance major tenants at Lancaster Luminaire,
115
TNR Tower and Lotte Mall West Lake Hanoi. In a context where the global
economy is facing many challenges and uncertainties, the remaining Grade A
110 office buildings have not recorded any new large-scale leasing transactions.
• Owner-occupied demand drove the quarter's Grade B office space transactions,
Index

105
but overall leasing activity remained weak with limited absorption across active
100
buildings.
95
Lotte Mall West Lake Hanoi enters Grade A office market
90
4Q18 4Q19 4Q20 4Q21 4Q22 4Q23 • The completion of Lotte Mall West Lake in 3Q23 provided another 20,553 sqm
NLA to the market, bringing the total Grade A supply to 491,000 sqm NLA.
Dotted line indicates near-term outlook
Index base: 4Q18=100
Meanwhile, the total Grade B office supply remained constant at 1.87 mil sqm
Financial Indicators are rental value index for Grade NLA with no new supply.
A&B Office and For lease properties.
Source: JLL Research • Overall office vacancy in 3Q23 stood at 17.3% for Grade A while Grade B stood at
14.4%, lower 1.5% q-o-q. Notably, the Grade A vacancy rate in the Non-CBD
Physical Indicators increased to 14.7%, a result of new completion of Lotte Mall West Lake Hanoi
building in the area this quarter.
250 93%
New completion drives Grade A rent in Non-CBD area
200
90%
• Non-CBD net effective rents saw a significant uptick with 5.4% increase q-o-q,
Thousand sqm

150 reaching USD 23.5 per sqm per month. This increase in rent was primarily driven
87%
100 by the completion and opening of Lotte Mall West Lake Hanoi, which set above-
84%
average rental rates given the project's high specifications.
50
• Meanwhile, Grade A net effective rent in CBD reached USD 32.6 per sqm per
0 81%
2018 2019 2020 2021 2022 2023
month, a modest increase of 0.5% q-o-q. In contrast, Grade B net effective rents
New Supply Future Supply of overall market decreased 2.24% q-o-q to USD 15.3 per sqm per month.
Occupancy Rate (RHS)
Outlook: New high-quality supply continues to face pressure
For 2018 to 2022, new supply and occupancy rate
are year-end annual. For 2023, new supply and • In 4Q23, an additional 81,462 sqm of net leasable area is projected to be added
occupancy rate are as at 3Q23. Future supply is for
from two Grade A and one Grade B building. Continuous supply hitting the
the remainder of 2023.
Physical Indicators are for Grade A&B Office and For market will exert further competitive pressure on the market amid weaker
lease properties. demand due to economic uncertainties.
Source: JLL Research
• The average Grade A&B rent by the end of 2023 is projected to be stable q-o-q. In
the context of abundant new supply, existing buildings are likely to retain tenants
through rent stabilization policies or other incentive baskets.

Note: CBD area refers to District Hoan Kiem District, Ba Dinh, Dong Da, part of Hai Ba Trung District
(within 1km from CBD).
Please prefer to Terminology for detailed classification.
10 | Market Insights | Hanoi | JLL Vietnam Market Brief – Q3 2023

Retail Market

“ Positive demand is recorded,

strongly driven by domestic
demand.
Rental Growth y-o-y
+6.3%
sqm per month,
net effective on NLA
USD 35.6
Stage in Cycle
Rent Rising

Financial Indicators Net absorption in Hanoi maintains a stable trajectory

• Leasing activities in the City Centre are subdued due to limited vacancy.
140 Meanwhile, the City Fringe recorded high net absorption of 2,018 sqm, thanks to
120 active leasing activities in well-established shopping malls such as The Loop
Shopping Center, Vincom Mega Mall Royal City, and AEON Mall Ha Dong.
100

80 • The F&B industry continued to lead new lease demands this quarter, with mainly
medium-scale transactions. Notable deals included the Hutong restaurant chain
Index

60
at The Loop Shopping Center and Hasan BBQ at Vincom Mega Mall Royal City.
40 The fashion and sports industry group also showed positive demand,
20 demonstrated by the expansion of New Balance at The Loop Shopping Center
and the Xtep brand at The Garden Shopping Center.
0
4Q18 4Q19 4Q20 4Q21 4Q22 4Q23
Lotte Mall West Lake Hanoi* debut in the final week of the quarter
Dotted line indicates near-term outlook
Index base: 4Q18=100
• In 3Q23, Hanoi’s prime mall supply in City Centre stood firm at 54,962 sqm. Trang
Financial Indicators are rental value index for Prime Tien Plaza initiated enhancements on its 2nd and 3rd floors, aiming for a
malls contemporary appeal. City Centre’s vacancy rate continued to decrease slightly,
Source: JLL Research
reaching 5.2%, the same as pre-pandemic levels

Physical Indicators • In City Fringe, the vacancy rate experienced a minor decline, falling to 6.0% in
3Q23. Lotte Mall West Lake Hanoi had its opening in the final week of this quarter,
100 98% quickly gaining market attention as a cutting-edge with experienced retail
90
96% concept shopping mall in Hanoi.
80
70 94%
Net effective rents exhibit a slight increase
Thousand sqm

60 92%
50
40 90% • Net effective rents in the City Centre remained at USD 65.1 per sqm per month,
30 88% marking a slight increase of 0.1% q-o-q, underlining the resilience of demand in
20
10
86% the heart of the city, even amidst challenging economic landscapes.
0 84%
2018 2019 2020 2021 2022 2023
• On the other hand, the City Fringe exhibited more tangible growth, with net
New Supply Future Supply effective rents climbing by 0.6% q-o-q to USD 32.6 per sqm per month.
Occupancy Rate (RHS)
Outlooks: Rents anticipate further growth, signalling steady
For 2018 to 2022, new supply and occupancy rate demand.
are year-end annual. For 2023, new supply and
occupancy rate are as at 3Q23. Future supply is for
• Total net absorption in City Centre for the whole year 2023 is expected to be at
the remainder of 2023.
Physical Indicators are for Prime malls only 2,000 sqm in the context of limited vacant space. In the City Fringe, net
Source: JLL Research absorption in 2023 will achieve a new high of 77,955 sqm NLA since 2019 thanks
to strong demand and the active le=asing activities in Lotte Mall West Lake Hanoi.
• By the end of 2023, net effective rents in the City Centre are expected to remain
on a positive trajectory, reaching USD 66.2 per sqm per month, a 3.8% y-o-y
increase. Lotte Mall Westlake Hanoi City will boost net effective rent growth in
City Centre towards the end of 2023, and is expected to increase by 11.6% y-o-y.

* The performance of this mall will be reflected on overall market basket starting in 4Q23
Note: City Centre refers to Hoan Kiem, a part of Ba Dinh and Hai Ba Trung District.
Please prefer to Terminology for detailed classification.
11 | Market Insights | Hanoi | JLL Vietnam Market Brief – 3Q23

Hotel Market

“ More international tourists

visited Hanoi than expected,
encouraging a positive
outlook in demand.
YTD RevPAR
Growth y-o-y
+71.9%
YTD RevPAR
USD 75.6
Stage in Cycle
RevPAR Rising

Financial Indicators International tourism exceeding expectations for the year

• As of September 2023, Hanoi welcomed a total of 18.9 million of tourists, an
120 increase of more than 36% from the same period in 2022. Despite representing a
100
proportion of 17% of the total number, international tourists have increased
significantly and exceeded the annual target of 3 million.
80
• To promote Hanoi's standing as a premier destination for both domestic and
international travellers, the authorities have implemented proactive measures to
Index

60
introduce innovative tourism offerings and encourage a wide range of leisure
40
activities. These initiatives aim to enhance Hanoi's reputation and attract a both
20 domestic and international visitors to the capital city.
0 One international branded hotel opened in 3Q23
4Q18 4Q19 4Q20 4Q21 4Q22
• L7 West Lake Hanoi by Lotte, an international branded hotel, opened its doors in
Dotted line indicates near-term outlook
Index base: 4Q18=100
August 2023, and is located in Tay Ho. This opening brings 456 new keys to Hanoi
Financial Indicators are RevPAR index existing hotel supply and seeks to enhance the variety of accommodations in
Source: STR Hanoi and make it a more attractive destination for visitors from Korea, as well as
from other regions. No new supply is expected to open by the end of year,
bringing the total new supply for the full year 2023 to 7 hotels and 564 rooms in
Physical Indicators Hanoi.
3 90% Rebound in trading performance in the month of September
80%
3
70% • The summer months of July and August 2023 in Hanoi recorded a stable level of
2 60% occupancy and ADR. However, there are signs of an early peak season starting in
Thousand rooms

50%
2 September, as both occupancy and ADR have shown noticeable increases during
40%
1 30% the month. This suggests a growing demand for accommodations in Hanoi and a
20% positive trend in the city's tourism industry.
1
10%
0 0% • As of YTD September 2023, hotels in Hanoi recorded a RevPAR of c. USD 76,
2018 2019 2020 2021 2022 2023 which represents 81% of YTD September 2022 due to a lagging occupancy rate in
New Supply Future Supply the first nine months of the year.
Occupancy Rate (RHS)

For 2018 to 2022, new supply and occupancy rate Outlook: Strong expectations with the upcoming peak season
are year-end annual. For 2023, new supply and
occupancy rate are as at 3Q23. Future supply is for • From Q4 2023 to Q1 2024, Hanoi is expected to witness its peak season for
the remainder of 2023. international tourists. To capitalize on this opportunity, the city has elaborated
Source: JLL Research strategies to organise a series of promotional activities that aim to boost tourism
demand. Additionally, Hanoi plans to host various types of events such as night-
time activities, festivals, and eco-tourism initiatives. These aim to not only
enhance tourism demand but also extend the average duration of visitors' stays
in the city.
12 | Market Insights | Hanoi | JLL Vietnam Market Brief – Q3 2023

Apartment Market

“ Remaining phases of large-

scale townships drives the
market performance in 3Q23.
Price Growth y-o-y
+9.5%
Primary Price on NFA
USD 2,083
Stage in Cycle
Growth Slowing

Financial Indicators Projects with reasonable selling price and reliable handover
schedule continue to entice buyers
180 • The total sold in 3Q23 was 3,819 units, about two times higher compared to the
160 last quarter. Demand moved in tandem with new supply with mainly driven by
140 Premium and Mid-end segments.
120
100
• Premium new projects quoted under USD 3,000/sqm recorded good
transactions, while existing projects with higher selling prices recorded low net
Index

80
absorption. Meanwhile, legal certainty and a trustworthy handover schedule
60
motivated home buyers in the Mid-end segment to purchase.
40
20 Remaining phases of large-scale townships dominate new supply
0
4Q18 4Q19 4Q20 4Q21 4Q22 4Q23 • About 3,160 apartment units were launched in 3Q23, boosting the total stocks for
apartment in Hanoi for the first nine months of 2023 to 7,520 units, drop by -
Dotted line indicates near-term outlook
Index base: 4Q18=100
32.5% compared to 9M22.
Financial Indicators are average primary price index
for all grades - Ultra-Luxury, Luxury, Premium, Mid- • Quarterly new launches came from subsequent phases of existing projects, such
end and Affordable segment as Masteri West Height (Nam Tu Liem), Masteri Waterfront (Gia Lam), Green
Source: JLL Research Diamond (Dong Da), Vinhomes Smart City_The Sakura phase, Vinhomes Ocean
Physical Indicators Park_The Zurich, Khai Son Hill and Viha Lexiva (Viha Complex).
Selling prices remain resilient
45 100%
40 99% • The average primary price in overall was USD 2,083 per sqm, down 0.82% q-o-q
35 98%
30
and up 9.48% y-o-y. However, the chain-linked changes of average primary price
Thousand sqm

97%
25 were up 2.42% q-o-q and 7.87% y-o-y, as most projects have reached the
96%
20
95%
finishing or handover stage and some discount programs have been removed.
15
10 94% • For the secondary market, overall average selling price slightly increased, up
93%
5 0.91% q-o-q and 7.35% y-o-y. Projects with prime locations and high handover
0 92%
2018 2019 2020 2021 2022 2023
standard maintained selling price improvement, yet at modest level.
New Supply Future Supply
Outlooks: Bleak supply remains with unclear signs of recovery
Sale Rate (RHS)

For 2018 to 2022, new supply and sale rate are year- • In 4Q23, JLL estimates around 1,750 apartment units will enter the market,
end annual. For 2023, new supply and sale rate are mostly coming from next phases of existing projects. Total launches in 2023 are
as at 3Q23. Future supply is for the remainder of
expected at 9,200 units, a 12-year low.
2023.
Physical Indicators are for all grades - Ultra-Luxury,
Luxury, Premium, Mid-end and Affordable segment.
• Primary price may continue to increase in 4Q23-1Q24, considering limited high-
Source: JLL Research quality new projects. The growth is expected to stay moderate compared to
other period, driven by end-of-year sale promotions and cautious mentality of
buyers. Both customers and developers are cautiously observing the market for
investment opportunities, showing little signs of recovery in short term.

Note: CBD refers to Hoan Kiem District

Please prefer to Terminology for detailed classification.
13 | Market Insights | Northern | JLL Vietnam Market Brief – Q3 2023

Ready-built Landed Property Market

“ Ocean City by Vingroup is in

the spotlight amid weak
market sentiment.
Price Growth y-o-y
+0.7%
Primary Price on Land
USD 6,032
Stage in Cycle
Stable

Financial Indicators Buyers are cautiously observing the market

• Net absorption in Hanoi market was only 65 units sold in 3Q23, mainly from new
180 launches of an existing project in the inner city and a new project in the suburban
160 area with a low selling price (< USD 600,000 per unit). Given weak market
140 sentiment, the developer boosted demand by applying various payment
120 methods such as lengthening the payment progress.
100
• Greater Hanoi market recorded a surprisingly low number of sales with 157 units.
Index

80
The total sales for the first nine months of the year decreased by 92.6%
60
compared to the same period last year. Official transactions mainly took place in
40
the shophouse products from newly-launched Mega Grand World_The Venice
20
project, with the unit value from USD 400,000-600,000 per unit.
0
4Q20 4Q21 4Q22 4Q23
Ocean City by Vingroup continues a spotlight on the market amid
Dotted line indicates near-term outlook limited supply
Index base: 4Q20=100
Financial Indicators are primary price index for all • Hanoi witnessed limited supply with only 60 newly launched units, mainly from a
types - Villas, Townhouses and Shophouses. newly launched project – Eurowindow Twin Parks (Gia Lam). The market
Source: JLL Research
remained in “hibernation”, with most projects continuing to stop selling
inventories in this quarter to reconsider pricing strategies.
Physical Indicators
• In four satellite provinces, the new supply is limited with 213 new launches.
18 100% Developers are primarily focused on preparing sales strategies and waiting for
16
100% the economic recovery. Vingroup's Ocean City in Hung Yen remained a market
14
12 99%
spotlight, with a focus on rapidly constructing and selling Mega Grand World_The
Thousand units

10 Venice phase to boost the project's commercial amenities.

99%
8
6 98% Stable prices aim to boost liquidity
4
2
98% • The Northern RBL market maintained a stable average primary price of USD
0 97% 6,032 per sqm land this quarter with most high-priced inventory from previous
2020 2021 2022 2023 quarters continuing to be locked for repricing purposes. Meanwhile, a large
New Supply Future Supply proportion of the current supply consists of new projects with average prices that
Sale Rate (RHS)
offer various discounts and payment methods to boost liquidity.
For 2020 to 2022, new supply and sale rate are year-
end annual. For 2023, new supply and sale rate are Outlooks: Expectations for new supply towards the end of the year
as at 3Q23. Future supply is for the remainder of
2023. • RBL unit launches in 4Q23 are expected to increase significantly, ranging from
Physical Indicators are for all types - Villas, 1,200 to 2,000 units and concentrating in Hung Yen. Future recovery remains
Townhouses and Shophouses.
Source: JLL Research heavily dependent on legal developments and market sentiment.
• The selling price tends to maintain in existing supply and slightly increase in new
phases of current projects. The successful transactions will predominantly stem
from projects that boast a robust legal standing, have attractive prices and
exhibit superior quality in urban infrastructure connectivity.

Note: Northern area consists of Hanoi, Hung Yen, Hai Phong, Bac Ninh, Vinh Phuc markets.
14 | Market Insights | Northern | JLL Vietnam Market Brief – Q3 2023

Ready-built Warehouse Market

“ Positive demand is recorded

after a period of gloom.
Price Growth y-o-y
+5.7%
sqm per month,
net asking on GFA
USD 4.6
Stage in Cycle
Growth Slowing

Financial Indicators New projects report strong net absorption

• Modern RBW rental demand in 3Q23 gradually stabilised after a bleak period
160 throughout 1H23. Besides retailers, 3PLs, and e-commerce, modern warehouse
140 demand was diversified with the participation of manufacturers and distributors.
120
• Net absorption in 3Q23 reached 89,677 sqm, mainly from leasing efforts of new
100 projects entering the market in the last two quarters, namely JD Logistics Park
Hai Phong, SLP Park Nam Son Hap Linh and SLP Park Yen Phong.
Index

80

60
Significant new supply from Hung Yen and Hai Phong provinces
40

20 • In 3Q23, Modern RBW in the Northern market welcomed a large amount of new
0
supply with 132,257sqm from three new projects, bringing the total stocks to
4Q18 4Q19 4Q20 4Q21 4Q22 4Q23 about 1.1 million sqm. JD Logistics Park Hai Phong marked JD Property’s first
foray into the Northern market.
Dotted line indicates near-term outlook
Index base: 4Q18=100 • In general, Modern RBW located in favourable locations along with ability to offer
Financial Indicators are rental value index for
Modern warehouses and For lease properties. flexible pricing strategies continued to attract tenants despite gloomy market
Source: JLL Research situation. At the same time, landlords adapted to market uncertainty by
upgrading the existing RBWs with additional function as Ready-built-factory
Physical Indicators (RBF) to meet diverse demands of different tenants.
Competitive prices of new projects slightly lower average rent
400 120%
350
100% • The average rent of Modern RBWs in the Northern market was recorded at USD
300
80%
4.6 per sqm per month in 3Q23, slightly decreasing by 1.0% q-o-q yet still
Thousand sqm

250
increasing by 5.67% y-o-y, mainly thanks to the competitive leasing strategies in
200 60%
150
new projects to allure tenants. Meanwhile, average rents of other projects did not
40%
100
witness any notable changes.
20%
50
Outlooks: Supply is set to increase by 1.6 times in the next 12
0 0%
2018 2019 2020 2021 2022 2023 months
New Supply Future Supply
• No new Modern RBW projects are planned to enter the market in 4Q23, a
Occupancy Rate (RHS)
decrease from previous quarter forecasts due to some investors converting their
For 2018 to 2022, new supply and occupancy rate nearly completed RBWs to RBFs function. However, market is expected to
are year-end annual. For 2023, new supply and
occupancy rate are as at 3Q23. Future supply is for welcome 700,000sqm of new supply in 2024, from high-quality RBW projects in
the remainder of 2023. Bac Ninh, Hai Phong and Hung Yen.
Physical Indicators are for Modern warehouses and
For lease properties. • As supply of high-quality projects is abundant while demand stabilizes, average
Source: JLL Research rent of new projects in Northern Modern RBWs market is anticipated to remain
stable, while existing projects would have to adjust their rental prices to be more
competitive to attract new tenants.

Note: Northern area consists of Hanoi, Hung Yen, Hai Phong, Bac Ninh, Hai Duong markets.
15 | Market Insights | Danang | JLL Vietnam Market Brief – Q3 2023

Hotel Market

“ The tourism sector is a major

contributor to Danang’s
economic development.
YTD RevPAR
Growth y-o-y
+150.5%
YTD RevPAR
USD 84.2
Stage in Cycle
RevPAR Rising

Financial Indicators Gradual recovery in tourism arrivals

• As of YTD 3Q23, Danang counted an estimated 5.86 million of visitor arrivals at
120 accommodation, a significant growth of 111% from the same period last year,
100
amongst which 73% were domestic. Despite representing a small portion of the
total number, international tourists have increased stronger than domestic
80 visitors (+490% y-o-y for international vs. +70% y-o-y for domestic).
• Danang is particularly famous amongst tourists from South Korea who form the
Index

60
top source market in the first nine months of 2023, followed by Thailand and
40
Taiwan.
20
Only one hotel reopening in 3Q23, no new supply
0
4Q18 4Q19 4Q20 4Q21 4Q22 • In the first nine months of 2023, Danang counted a total of 15 hotels and 2,754
rooms added to the existing supply. More specifically in Q3, only one hotel
Dotted line indicates near-term outlook
Index base: 4Q18=100
reopened after a closure period due to the pandemic: Grandvrio Ocean Resort
Financial Indicators are RevPAR index Danang with its 169 keys.
Source: STR
• Marriott International is expected to count for the entire upcoming supply by the
end of 2023 with the opening of Marriott Executive Apartments Danang Han River
Physical Indicators and Courtyard by Marriott Danang Han River. Both properties will add a total of
615 keys to Danang’s hotel supply.
6 80%
70%
Strongest growth in trading performance
5
60%
4
• As of YTD September 2023, hotels in Danang have recorded the strongest growth
Thousand rooms

50%
in RevPAR amongst all major destinations of Vietnam. Compared to the same
3 40%
30%
period last year, YTD RevPAR increased by almost 151%, led by a significant rise
2
20%
in occupancy and a stable growth in ADR. Occupancy has reached almost 59%
1
10% from 29% last year.
0 0%
2018 2019 2020 2021 2022 2023 Outlook: Danang targets 2.5 million of international tourists in 2024
New Supply Future Supply
• Danang’s Municipal Travel and Tourism Strategy to 2030 aims to transform the
Occupancy Rate (RHS)
city into a hub for tourism and high-quality services in Vietnam. These goals will
For 2018 to 2022, new supply and occupancy rate imply a focus on creating new tourism products to develop unique experiences.
are year-end annual. For 2023, new supply and
occupancy rate are as at 3Q23. Future supply is for Danang targets to welcome 2.5 million international tourists in 2024 and 2.8
the remainder of 2023. million by 2025.
Source: JLL Research
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Terminology
Property clock
Property clock

The clock diagram illustrates where JLL estimates the stage of each property market within its individual rent/price cycle at the
end of the review quarter. It helps to signify the expected RC/CV movements in the short-term, i.e., in the next one to two quarters.
The diagram is a convenient method of comparing the relative position of markets in their rent/price cycle. Their position is not
necessarily representative of the investment or development market prospects. Their position refers to the prevailing rent or
price trend and its expected movement in the next quarter. Generally, it’s normal for markets to move from one stage to another;
a couple of markets have previously been swinging pretty wildly.
The Property Clock is divided into four pies:
• Rents/Prices falling means the values are expected to start falling, and the pace of fall is accelerating
• Rents/Prices decline means the values are expected to still fall, although the pace is slowing down
• Rents/Prices rising means the values are expected to start rising, and the pace of growth is accelerating
• Rents/Prices growth slowing, means the values are expected to still grow, but the pace is slowing down
Terminology
Office market
Current supply The total amount of cumulative office space (in NFA terms) that has been completed at a given time.

Owner-occupied supply Current supply with up to 80% Owner occupied.

For lease supply Current supply is ready for lease to the market and not Owner occupied building

Future supply The total amount of office space at a given time slated for completion in the future.

Vacant space The total amount of available office space that remains to be leased by the property owner(s) at a
given time. This excludes space available for sub-lease by tenants (i.e., shadow space), space physically
empty but already pre-leased or reserved, and space to be available for lease in the future.

Occupied space The current supply is less vacant space. “Net absorption” refers to the change in the occupied space
from quarter to quarter.
Gross Floor Area (GFA) The total amount of all covered areas, including columns, walls, common passageways, lifts, lobbies
and toilets.
Net Floor Area (NFA) The amount of usable floor area, excluding columns, walls, common passageways, lifts, lobbies and
toilets. Net lettable area or Net leasable area (NLA) refers to the amount of NFA that is available for
lease.
Net rent The amount of market rent receivable by landlords after deducting outgoings.
Market practices: Net rents may be quoted on an NFA or a GFA basis
Outgoings The estimated costs set aside by landlords for building maintenance and later passed on to tenants in
the form of service charges or management fees.
Market practices: Service charges/management fees may or may not be quoted separately from net
rents.
Gross rent The total achievable rent to be borne by tenants, including service charges/management fees. Gross
rents equal net rents plus outgoings.
Market practices: Gross rents may be quoted on an NFA or a GFA basis.
Face rent The amount of market rent that is written on the contract.
Market practices: Face rent was also known as headline rent or contract rent. Face rents may be quoted
on gross rent or net rent.

Effective rent The amount of market rent receivable by landlords.

Market practices: Effective rents are calculated based on the face rent.

Capital value The market value or probable price of a property at a given time from a valuation point of view.
Yield The percentage return on property investment from a valuation point of view at a given time. It is based
on current market rents assuming full occupancy.
Grade A A Grade A property meets all the factors in a set of criteria regarding its offerings to a typically
sophisticated occupier. These criteria are broadly concerned with the property’s overall profile,
location, amenities, management standards and technical specifications.

Grade B A Grade B property meets some of the factors in a set of criteria regarding its offerings to a typically
sophisticated occupier. These criteria are broadly concerned with the property’s overall profile,
location, amenities, management standards and technical specifications.
Grade C A Grade C property meets a set of criteria regarding its offerings to a typically non-sophisticated
occupier. These criteria are broadly concerned with the property’s overall profile, location, amenities,
management standards and technical specifications.
Terminology
Office market (cont.)
Precincts/ Submarkets HCMC Office consists of six precincts: Core CBD, CBD Fringe, HCMC South, HCMC East, HCMC North and
Others; and the Hanoi Office consists of six precincts: Core CBD, Mid-town, Hanoi West, The Westlake and
Others. The detailed classifications are provided as below

HCMC Office Precincts/ Submarkets

CBD Core CBD District 1, part of District 3 (within CBD 1km radius) and Thu Thiem

Remaining part of District 3 and part of Districts 4 and 10 - within CBD 2km
CBD Fringe
radius

HCMC South So called ‘Saigon South’, incl. District7 and remaining part of District 4

Non-CBD HCMC East Thu Duc City (Excl. Thu Thiem) and Binh Thanh District

HCMC North Districts Phu Nhuan, Tan Binh, Tan Phu and Go Vap

Others Remaining part of District 10 and Districts 5, 6, 8, 11, 12 and Nha Be.

Hanoi Office Precincts/ Submarkets

Core CBD Hoan Kiem District

CBD
Districts Ba Dinh, Dong Da, part of Hai Ba Trung District (within 1km from
Mid-town
CBD)

Hanoi West Districts Cau Giay, Nam Tu Liem

Tay Ho District and part of Bac Tu Liem District (within 1km from Starlake
Non-CBD The Westlake
NUA)
Remaining part of District Bac Tu Liem, Hai Ba Trung and Districts Hoang
Others
Mai, Long Bien, Ha Dong, Gia Lam, Hoai Duc, Dong Anh and Dan Phuong.
Terminology
Retail market
Current supply The total amount of cumulative modern (as opposed to traditional) retail space (in GFA terms) that has
been completed at a given time. This includes department stores, shopping centres and prime retail
space.
Future supply The total amount of modern retail space is slated for completion in the future at a given time.
Vacant space The total amount of available modern retail space that remains to be leased by the property owner(s) at
a given time. This excludes space available for sub-lease by tenants (i.e., shadow space), space
physically empty but already pre-leased or reserved, and space to be available for lease in the future.
Occupied space The current supply has less vacant space. “Net absorption” refers to the change in occupied space from
quarter to quarter.
Net leasable area (NLA) The total amount of leasable floor area on which rents and service charges are based, which excludes
common areas used for foot traffic.
Net rent The total achievable rent to be borne by tenants, excluding service charges/management fees and VAT.
Market practices: Net rents in the retail market are usually quoted on NLA basis.

Shopping Centre A shopping centre is a property housing commercial multi-branded rental units/stores/establishments
and common areas. It is planned, developed and operated. The property is classified in the hierarchy by
function and/or size and by the area served.
Department Store Usually, a multi-level retail property varying in size, from one selling a variety of goods to the other
selling a full range of different lines. A distinctive feature of a department store is that 90% of the space is
under a centralised payment system, and it stocks a significant number of cosmetics, fashion and
household goods.
Supply Basket A shopping centre is a landlord-developed and operated commercial project. Most of the tenant stores
have dividing walls and frontage. A shopping centre operator can lease anchor space to department
stores/entertainment operators/supermarkets, and other types of retail requiring large floor space.

Under shopping centre, we classify retail centres in the hierarchy by function and/or size and by the area
served as below:
▪ Neighbourhood Speciality spaces of less than 10,000 sqm NLA, housing 10 to 30 stores which are mostly convenience
Centre and shopping stores targeting local residents.
▪ Community Mall Similar features to neighbourhood centre but larger scale, range of speciality spaces between 10,000-
25,000 sqm NLA, housing 30 to 100 stores
▪ Regional Centre Speciality space of more than 30,000 sqm NLA or 100 stores or speciality stores, anchored by one large
department store, attracting more than 10,000 customers per day.
▪ Super Regional Similarly defined as a regional shopping centre, but comprising more than one department store.
Centre
While Vietnam Retail market is widely diversified with a variety of product types, including all the types
listed above, to stay relevant to our target readers, beginning in 1Q21, this report has been covering
Regional Shopping Centre, Super Regional Centre and Community Mall only.
Performance Basket To ensure consistency in market performance observations, JLL selected a subset of the Supply Basket
(above) for the occupancy rate and Rental basket − the so-called Prime Mall basket. All the demand-
related indicators in this report refer to Prime Mall if there is no further explanation. The definition of
Prime Mall is listed in our Performance Basket as below:
Prime Grade Represents high-quality retail space meeting various rigorous criteria, including an excellent location
and accessibility, developer reputation, layout and ambience, management quality and tenant mix.

Non-Prime Grade Represents retail centres that do not meet our Prime Grade standards in terms of location and
accessibility, developer reputation, layout and ambience, management quality, tenant mix or a
combination thereof.
Terminology
Retail market (cont.)
Precincts/ Submarkets HCMC and Hanoi Retail market consists of two precincts: City Centre and City Fringe. The detailed
classifications are provided as below.

HCMC Retail Precincts/ Submarkets

City Centre Districts 1 and 3.

City Fringe Districts 2, 4, 5, 6, 7, 8, 9, 10, 11, 12, Thu Duc, Binh Thanh, Tan Binh, Go Vap, Tan Phu, Binh Tan.

Hanoi Retail Precincts/ Submarkets

City Centre including Hoan Kiem District, Ba Dinh District, and a part of Hai Ba Trung District (bordered on the
north by Nguyen Du – Le Van Huu street, on the south by Dai Co Viet – Tran Khat Chan street, on the
east by Lo Duc Street and west by Le Duan Street)

City Fringe Dong Da, Hai Ba Trung, Tay Ho, Long Bien, Cau Giay, Nam Tu Liem, Bac Tu Liem, Thanh Xuan, and Ha
Dong Districts.
Terminology
Residential market
Commercial Apartment for Developer-built apartments that are widely available for sale on the market without any restrictions
sale or Apartment for sale on target buyers, according to the market mechanism.
According to JLL in-house classification, the Vietnam Apartment for Sale Market is categorised as
Ultra-Luxury, Luxury, Premium, Mid-end and Affordable segments. The detailed classifications are
provided on the following page.

Ready-built landed property Developer-built landed properties that are widely available for sale on the market without any
for sale or Ready-built landed restrictions on target buyers, according to the market mechanism, where the products comprise the
property house(s) on the ground. The developers provide a land plot with the necessary infrastructure and
houses built based on the developer’s master plan and design.
As per market practices, there are three types of Ready-built landed properties; villa, townhouse and
shophouse. The detailed classifications are provided on the following page.

Branded residence Refers to the residential property available for sale on the market that is incorporated with
recognisable hotel-operator brands. Residences are for sale to individual buyers, to be enjoyed for
personal use or pooled back into the hotel’s rental pool as an investment vehicle. It can be either a
standalone unit or part of the mixed-use development featuring a hotel component.

Current supply The total amount of supply available for sale, either through the Primary market or the Secondary
market, regardless of construction status.

Future supply The total amount of supply to be launched for sale in the future.
Completed supply The total amount of supply that has been physically completed and handed over for occupation.
Also known as existing supply.

Uncompleted supply The total amount of supply that has not been physically completed and handed over for occupation.
Includes supply under construction and supply planned for construction. Also known as supply in
the pipeline.

Primary market Part of the market that comprises first-hand supply available for sale from developers.
Secondary market Part of the market that comprises second-hand supply available for resale from previous buyers.
Launches (Official launches) The estimated amount of new supply (in units) officially launched for sale during a period. Projects
are considered ‘officially launched’ only when the Sale Purchase Agreements are signed, typically
upon the completion of foundations for the Apartment sector and the completion of internal
infrastructure according to the project schedule for Ready-built landed property.
Market practices: Many developers choose to launch their projects in phases that may or may not be
publicly announced.

Take-up The estimated amount of supply (in units) sold during a period. Includes sold units from new supply
in the period and supply from previous periods.
Market practices: Take-up may comprise units sold via capital contributions or sale and purchase
agreements.

Total inventory The total amount of unsold supply that has been launched for sale.
Cumulative sales rate The percentage between cumulative units sold and cumulative units launched up to the specific
time.

Primary asking price The stock-weighted average asking price in the Primary market.
Secondary asking price The stock-weighted average asking price in the Secondary market.
Non-chain-link changes. q-o-q and y-o-y changes include the effect of supply additions/removals
Chain-link changes q-o-q and y-o-y changes are adjusted to remove the effects of supply additions/removals.
Terminology
Residential market (cont.)
Ultra-Luxury apartment An ultra-luxury property meets all of the factors in a set of criteria regarding its offerings to high net-
worth individuals or households in the country and region, usually associated with a premium brand
that offers top-notch services and prestige and recognition. These criteria are broadly concerned with
the property’s overall profile, location, facilities, amenities, and management standards. A majority of
ultra-luxury properties are located in the CBD of the city under review.
Typical price range: > USD 10,000 per sqm, excluding VAT and sinking fund
Luxury apartment A luxury property meets all of the factors in a set of criteria regarding its offerings to a typical local
wealthy household. These criteria are broadly concerned with the property’s overall profile, location,
facilities, amenities and management standards. A majority of luxury properties are located in or near
the CBD of the city under review.
Typical price range: > USD 4,000–USD 10,000 per sqm, excluding VAT and sinking fund
Premium apartment A premium property meets some of the factors in a set of criteria regarding its offerings to a typical local
wealthy household. These criteria are broadly concerned with the property’s overall profile, location,
facilities, amenities and management standards. A majority of premium properties are located in new
urban areas outside the CBD of the city under review.
Typical price range: USD 3,000–USD 4,000 per sqm, excluding VAT and sinking fund
Mid-end apartment A mid-end property meets all of the factors in a set of criteria regarding its offerings to a typical local
middle-class household. These criteria are broadly concerned with the property’s overall profile,
location, facilities, amenities and management standards. A majority of mid-end properties are located
within the inner districts of the city under review.
Typical price range: USD 1,500–USD 3,000 per sqm, excluding VAT and sinking fund
Affordable apartment An affordable property meets some of the factors in a set of criteria regarding its offerings to a typical
local middle-class household. These criteria are broadly concerned with the property’s overall profile,
location, facilities, amenities and management standards. A majority of affordable properties are
located in the outer districts of the city under review.
Typical price range: < USD 1,500 per sqm, excluding VAT and sinking fund
Note: The price ranges provided above should not be understood as the sole and utmost criterion based
on which projects are assigned grades.
High-end apartment including Ultra Luxury, Luxury and Premium segments
Low-end (Mass-market) including Mid-end and Affordable segments
apartment
Villa A large and luxurious country house on its own grounds, generally having a maximum of three floors.
The plot ratio is usually less than 70%, with a focus on a green area.
▪ Most popular villas are located on 200-300 sqm land plots. Some luxury villa plot areas may reach
500-1,000 sqm.
▪ The popular construction area/Gross Floor Area (GFA) is about 250-350 sqm while the land plot is
large. For that reason, all things equal, the selling price per square metre of land is lower than that of
townhouses.
▪ Typically, there are two types of villa, as shown below:
− Detached villa: a single villa built on private land
− Semi-detached villa: a single villa built as one of a pair that shares one common wall; often,
each house layout is a mirror image of the other
Townhouse A tall, narrow terraced house, generally having three or more floors. The plot ratio is usually more than
70% and is focused on the construction floor area.
▪ Most popular townhouses have plot areas of 60-100 sqm
▪ The popular construction area/Gross Floor Area (GFA) is about 150-250 sqm
Shophouse A townhouse opening onto the pavement for commercial purposes.
▪ The construction and design are similar to those of townhouses. \
▪ The popular construction area/Gross Floor Area (GFA) of shophouses is about 250-400 sqm, with the
upper 3-4 floors for living purposes and the ground floor (or middle floor, if applicable) for
commercial purposes. It is larger than a townhouse.
Integrated project Refers to a neighbourhood or township development with mixed-use components, such as residential,
retail, institution, leisure and more, where residents can live, work and play. It comprises multifunctional
and interconnected buildings that focus on the surrounding environment to ensure harmonious ‘street-
scape’ and architecture.
Market practices: As the Vietnam real estate market is gradually maturing, a sustainably wholesome living
environment is an important factor for buyers to consider. Based on our real estate expertise, the suitable
size of an integrated development should be in excess of 5ha to ensure commercially viable facilities.
Note: The product classification provided above should not be understood as the sole and utmost criterion
based on which projects are assigned types.
Terminology
Residential market (cont.)
Precincts/ Submarkets According to JLL in-house classification, the HCMC Residential consists of seven
precincts: CBD, CBD Fringe, HCMC South, HCMC East, HCMC North, HCMC West and
Others; and the Hanoi Residential consists of seven precincts: CBD, CBD Fringe,
Hanoi South, Hanoi East, Hanoi North, Hanoi West and Others.

HCMC Residential Precincts/ Submarkets

CBD CBD District 1, part of District 3 (within CBD 1km radius) and Thu Thiem

CBD Fringe Remaining part of District 3, Districts 4 , 10, Phu Nhuan, Binh Thanh and part of
District 5 - within CBD 5km radius
HCMC South So called ‘Saigon South’, incl. Districts 7, Nha Be and part of Binh Chanh - from
QL50 to Nguyen Huu Tho St.
HCMC East Thu Duc City (Exc. Thu Thiem)

Non-CBD
HCMC North Districts 12, Tan Binh, Tan Phu and Go Vap

HCMC West Remaining part of District 5, Districts 6, 8, and Binh Tan.

Others Remaining part of Binh Chanh, Districts Hoc Mon, Cu Chi, Can Gio.

Hanoi Residential Precincts/ Submarkets

CBD CBD Hoan Kiem District

CBD Fringe Ba Dinh District, Dong Da District, part of Hai Ba Trung District (within 1km from
CBD)
Hanoi South Hoang Mai District, Remaining part of Hai Ba Trung District

Hanoi East Long Bien District, Gia Lam Commune

Non-CBD Hanoi West Cau Giay District, Nam Tu Liem District, Thanh Xuan District, Ha Dong District, Hoai
Duc Commune, Bac Tu Liem District, Tay Ho District, Dan Phuong Commune
Hanoi North Dong Anh Commune, Me Linh Commune

Others Ung Hoa Commune, Thuong Tin Commune, Thanh Oai Commune, Thach That
Commune, Quoc Oai Commune, Phu Xuyen Commune, My Duc Commune, Son
Tay Commune, Ba Vi Commune, Chuong My Commune, Phuc Tho Commune,
Thanh Tri Commune, Soc Son commune
Terminology
Hotel market
Average Daily Rate (ADR) A measure of the average rate paid for rooms sold, calculated by dividing room revenue by
rooms sold.
ADR = Room Revenue/Rooms Sold

Month to Date (MTD) Period that starts at the beginning of the current month and ends at the current date.

Number of rooms Total number of rentable rooms for overnight accommodations.

Occupancy (Occ.) Percentage of available rooms sold during a specified time period. Occupancy is calculated by
dividing the number of rooms sold by rooms available.
Occupancy = Rooms Sold / Rooms Available

Revenue Per Available Total room revenue divided by the total number of available rooms. See Room Revenue, Rooms
Room (RevPAR) Available.
Room Revenue/Rooms Available = RevPAR

Year to date (YTD) Period starting at the beginning of the current year and ending on the current date.
Terminology
Industrial market
Operating IPs or Existing IPs Industrial parks and processing zones that are officially offered for lease at a given time.
Total leasable land area The total land area for lease according to the master plan of the whole IP, regardless of its
development status. The total leasable land of an IP at a given time can comprise three types as
below:
▪ Infra-developed land: The leasable land area that the developer has cleared and implemented
internal infrastructure (including internal roads, electricity, etc.) and is ready for tenants to
occupy.
▪ Non-infrastructure land: The leasable land area that has been cleared but does not yet have
internal infrastructure developed. Non-infrastructure land can still be offered for lease, yet
tenants may have to wait a while (typically 3-6 months) to be able to occupy it.
▪ Uncompensated land: The leasable land area which has not been compensated for at a given
time.
Market practices: The developer usually develops an IP in batches depending on the expected
demand from the market, which is typically reflected by the number of enquiries the developer
received, not the total leasable land area all at once.

Total leasable warehouse/ The total area of leasable warehouse/ready-built RBF at a given time
ready-built RBF area

Modern (RBW grade) The facilities are built with steel structures, higher specifications with clear height from 9 to 12m, at
least 1 loading dock for every 1,500 - 2,000 sqm, sprinklers fire protection system and provide
additional logistics services

Traditional (RBW grade) The facilities that are often built with reinforced concrete structures, standard specifications for
clear height from 6 to 7m, floor loading of 1.5 - 2 ton/sqm, manual fire protection system and
provide limited number of loading bays/dock levellers

Vacant space The total amount of available industrial land area that remains to be leased to tenants at a given
time. This excludes space available for sub-lease by tenants (i.e., shadow space), space physically
empty but already pre-leased or reserved, and space to be available for lease in the future.

Occupied space Total leasable area less vacant space. “Net absorption” refers to the change in occupied space from
period to period

Net rent – land area The amount of market rent applied for a leasable land area that is receivable by landlords after
deducting outgoings
Market practices: Net land rent is normally quoted per square metre per lease term

Lease term The lease term is the remaining years of the lease for the industrial park or the property. In Vietnam,
the maximum lease term can be up to 50 years.

Net rent – Ready-built FactoryThe amount of market rent applied for leasable ready-built RBF area that is receivable by landlords
(RBF) after deducting outgoings
Market practices: Net rent may be quoted per square metre per month

Future supply The total area of future industrial parks and processing zones according to the master plans of the
provincial authorities
Terminology
Industrial market (cont.)
Tier I, II Tier I provinces/cities are more developed and mostly established surrounding main cites such as
HCMC or HN. Tier 2 provinces/cities that are close to Tier 1 provinces/cities will typically experience
spill-over effects as Tier 1 becomes more populated. Similarly, Tier 3 localities are the next to Tier 2 in
term of maturity.

North Key Economic Zone North Key Economic Zone comprises seven cities/provinces, namely, Hanoi, Hai Phong, Bac Ninh, Hai
(NKEZ) Duong, Hung Yen, Vinh Phuc and Quang Ninh.
In this Property Market Brief, the Northern Industrial market refers to Hanoi, Hai Phong, Bac Ninh,
Hung Yen, and Hai Duong markets

Central Key Economic Central Key Economic Zone comprises five provinces: Thua Thien Hue, Danang, Quang Nam, Quang
Zone (CKEZ) Ngai and Binh Dinh Provinces

South Key Economic Zone South Key Economic Zone comprises eight cities/provinces, namely, HCMC, Binh Duong, Dong Nai,
(SKEZ) Long An, Ba Ria-Vung Tau, Binh Phuoc, Tay Ninh and Tien Giang.
In this Property Market Brief, the Southern Industrial market refers to HCMC, Binh Duong, Dong Nai,
Long An, and Ba Ria-Vung Tau markets
Ho Chi Minh City Hanoi

26/F HCMC Trade Center Unit 902, 9/F Sun Red River Building
37 Ton Duc Thang Street, 23 Phan Chu Trinh Street,
District 1 Hoan Kiem District

Phone: +84 8 3911 9399 Phone: +84 24 3944 0133

Trang Le My Dam
Head of Research and Consultancy Marketing Director
+84 988 306 806 +84 328 445 688
trang.le@jll.com My.Dam@jll.com

About JLL About JLL Vietnam

For over 200 years, JLL (NYSE: JLL), a leading global Since its establishment in 2006, JLL has grown to be the
commercial real estate and investment management leading real estate services firm in Vietnam, with over 400
company, has helped clients buy, build, occupy, employees. JLL has the largest commercial agency team in
manage and invest in a variety of commercial, Vietnam and is one of the only firms that offers a full-scope
industrial, hotel, residential and retail properties. A of commercial services, including landlord and tenant
Fortune 500® company with annual revenue of $20.9 representation, interior fit-out, space optimization,
billion and operations in over 80 countries around consultancy, property and facility management services
the world, our more than 103,000 employees bring and professional consultancy services including valuation
the power of a global platform combined with local and research. 2019-2020 has been a remarkable year for
expertise. Driven by our purpose to shape the future JLL in Vietnam with all departments reporting
of real estate for a better world, we help our clients, unprecedented growth and the Capital Markets
people and communities SEE A BRIGHTER WAYSM. department successfully closing a number of high-profile
JLL is the brand name, and a registered trademark, deals. Recently, the total value of transactions consulted by
of Jones Lang LaSalle Incorporated. For further JLL reached over $250 million and most of the transaction
information, visit jll.com. types are property transfer and joint-venture partnerships
between Vietnamese and foreign developers.

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