Southeast Asia Outlook 2023

MARKET STATISTICS

RETAIL (SHOPPING CENTER)

READY-BUILT FACTORIES, (GREATER HCMC)

READY-BUILT WAREHOUSE (GREATER HCMC)

RESIDENTIAL (APT MID-END TO HIGH-END)

OFFICE (GRADE A&B)

$3.70 *

$4.40 *

$0.43

$0.45

Rents Q4 2022 (USD psf pm) 2023 Forecast

Selling Price: $253 psf **

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Vacancy/Sales Rate Q4 2022 2023 Forecast

7.7%

12.4%

20%

25%

Sales Rate: 50.9%

VIETNAM: HO CHI MINH MA R K E T S NA P S H OT

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Current Inventory

15.3 Million SF

10.1 Million SF

51.8 Million SF

54 Million SF

201,408 Units

Pipeline Supply (2023-2027)

2.8 Million SF

3.0 Million SF

2.1 Million SF

8.1 Million SF

70,071 Units

% of Current Inventory (Pipeline Supply over Current Inventory)

ECONOMY

18.4%

29.9%

4%

15%

35%

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2022 witnessed a recovery of Vietnam’s economy, with GDP growth recorded at 8%, exceeding previous forecast by most economic institutions (6.5 to 7.5%). In 2023, despite gloomy global economic outlook, Vietnam’s economy is still expected to maintain stable growth as GDP growth is forecast between 5.9% to 7.3%. However, caution and uncertainty remains the general sentiment coming from various anticipated challenges such as Vietnam’s reliance on trade activity with global partners, increasing inflationary pressure, and tightening monetary and fiscal policies in many countries.

Capital Value Outlook

* Office and retail rentals are inclusive of service charge ** Primary selling price

RECENT SIGNIFICANT DEALS

INVESTMENT OPPORTUNITIES

PROPERTY NAME

PROPERTY TYPE

PRICE (MIL USD)

BUYER

SELLER

DATE

1. OFFICE: Office demand is expected to trend higher in 2023, albeit at a slower pace especially for high-quality buildings in prime areas. Recent legal revision and market incidents have caused delayed completion of some future supply at prime locations. New business hubs are in development outside the CBD, moving toward the South (District 7) and the East (Thu Duc City) where new Grade A projects are distributed or expected to complete within the upcoming years. Investors should keep an eye on the developing legal framework of real estate and enter the market via joint ventures with well-established domestic developers. 2. READY-BUILT-FACTORIES: The notable investment flow in 2022 has been mainly focused on Ready-Built Warehouses (RBW) project development. With greater HCMC

area as a key manufacturing hub coupled with continued investment flows and higher manufacturing output, as well as increasing land use fees, there is room for potential future Ready-Built Factory (RBF) development targeting small and medium manufacturers. Opportunistic investors could leverage on development opportunities as there is an expected adjustment period for RBF demand 3. RESIDENTIAL: Ultra-luxury and Luxury sector in HCMC recently observed an oversupply, with a slow down in both demand and market sentiment. Meanwhile, there is still high demand towards Mid-end and High-end apartments, coming from both occupiers and investment buyers. Therefore, there is still potential for development in these sectors. to catch up to that of RBW’s; therefore stabilizing assets in a short time frame.

Land at Binh Duong Province

Sembcorp Industries, Becamex

Commercial - Industrial

Giant Manufacturing

13

Q3 2022

Future Data Center

Gaw Capital

N/A

Data Center

N/A

Q2 2022

Land at Binh Duong Province

Mixed Development

Gamuda Land

Becamex

59

Q2 2022

Source: RCA, Cushman & Wakefield Research

19

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