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HO CHI MINH CITY IS IN THE TOP FIVE MOST PREFERRED MARKET FOR INVESTMENT
TOP 10 PREFERRED CITIES FOR CROSS-BORDER INVESTMENT
BEIJING Ho Chi Minh City - 01 February 2021 - CBRE’s 2021 Asia Pacific Investor Intentions Survey, which polled more than 490 Asia Pacific-based investors in November and December 2020, uncovered an increase in investor interest in Ho Chi Minh City, which ranked fifth as Asia Pacific investors’ most preferred market for investments. With the diversification of supply chains encouraging more manufacturing investment, industrial and logistics assets are keenly sought after.
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SHANGHAI 7
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Hang Dang, Managing Director, CBRE Vietnam, says, “Ho Chi Minh City has already been on the radar of investors in recent years, especially those who are looking to invest in Southeast Asia, as the city is viewed as having the potential for greater appreciation in property values and higher yields.” Interestingly, investors who expressed interest in investing in Southeast Asia indicated that they are willing to pay more for real estate purchase. 39.4% of these investors are comfortable to pay more than 10% higher this year than what they are willing to pay in 2020, while 19.7% are willing to paying up to 10% higher. In the search for returns, investors looking at Southeast Asia are turning to value-add and core assets, even though there are some who are starting to look at distressed assets. Industrial/logistics and office remain their preferred sectors, while the hospitality sector is gaining favour.
SEOUL
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TOKYO
OSAKA
SHENZHEN
HCMC
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SINGAPORE
Legend
8 Top ten preferred cities*
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SYDNEY
MELBOURN E
Higher ranking than in 2020
*Cross border refers to respondents domiciled in a different country to the most attractive destination selected Source: CBRE Research, Americas Investor Intentions Survey, 2020.
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Duy Nguyen Director – Capital Market, CBRE Vietnam, comments:
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What we are seeing in the Vietnam market corresponds to the Survey result. The number of investment enquiries primarily falls into industrial logistics/warehouse sector as strong preference from investors searching for attractive yield and cash flow, followed by interests in residential sector due to high demand, and hospitality sector which starting to attract investors again with increasing distressed assets on the market.
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© CBRE, INC. |
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60% of investors intend to purchase more real estate this year, the highest level since 2016. The higher purchasing intentions are a consequence of pent-up demand from 2020, when the abrupt, pandemic-induced economic downturn, travel restrictions and uncertainty about the pandemic’s duration sharply curtailed investment activity. In addition, there remains a substantial volume of dry powder (capital that is committed but unallocated) searching for yield and ready to be deployed into real estate. At CBRE Vietnam, the Capital Market team saw a significant drop of enquiries from oversea investors in the first few months of 2020. Investors were more cautious and tend to focus on projects in their home market rather than to expand business in previous years. However, they still remain positive view about the Vietnam with potential investment outlook. In the last two months, there has been a gradual increase in foreign enquiries searching for properties across many sectors, particularly in industrial sector. It is a good sign that oversea investors are now back to market. Logistics was the most popular sector for investment as the pandemic-driven acceleration of e-commerce consumption boosted demand for this asset class. While interest in the office sector weakened, investors retain an optimistic view towards this sector, expecting a contraction in office purchasing activity of no more than 10% over the next three years.
For more information on investment opportunities in Vietnam property market, please contact us at !HOCHIMINH-Investment@cbre.com or below contact detail.
© 2021, CBRE, Group Inc. CBRE Limited confirms that information contained herein, including projections, has been obtained from sources believed to be reliable. While we do not doubt their accuracy, we have not verified them and make no guarantee, warranty or representation about them. It is your responsibility to confirm independently their accuracy and completeness. This information is presented exclusively for use by CBRE clients and professionals and all rights to the material are reserved and cannot be reproduced without prior written permission of CBRE. About CBRE Group, Inc.
Duy Nguyen (Mr.) MRICS | Director CBRE | Investment Properties Level 13 | AB Tower 76A Le Lai Street, District 1 | Ho Chi Minh City, Vietnam T +842862847668 | M +84933866284 Duy.Pham.Nguyen@cbre.com | www.cbre.com | www.cbrevietnam.com
Hang Dang (Ms.) Managing Director CBRE (Vietnam) Co., Ltd Hang.Dang@cbre.com
Dung Duong (Ms.) Senior Director Valuation, Research & Consulting Dung.Duong@cbre.com
CBRE Group, Inc. (NYSE:CBRE), a Fortune 500 and S&P 500 company headquartered in Los Angeles, is the world’s largest commercial real estate services and investment firm (based on 2019 revenue). The company has more than 100,000 employees (excluding affiliates) and serves real estate investors and occupiers through more than 530 offices (excluding affiliates) worldwide. CBRE offers a broad range of integrated services, including facilities, transaction and project management; property management; investment management; appraisal and valuation; property leasing; strategic consulting; property sales; mortgage services and development services. Please visit our website at www.cbre.com.