Savills Vietnam has just announced the report on Danang real estate market in the second quarter with remarkable information about Office-for-lease, Villa and Apartment-for-sale markets.
Office for lease: Raising demand
With about 2,100 new enterprises were licensed in 2009, which was an increase of 23% compared to 2008, demand for office for lease increase considerably. The other important factors affecting the office market is investments from overseas Vietnamese. According to Da Nang GSO, in 2009, remittances of US$94.6 million were sent to Da Nang citizens and 4,715 overseas Vietnamese visited Da Nang.
Currently, there are 21 office buildings with a total area of approximately 66,344 square metres, representing an increase of more than 3% quarter on quarter. Office buildings in Da Nang are only located in two districts: Hai Chau and Thanh Khe. Hai Chau District accounts for 80% of total supply.
Most existing office buildings are of medium quality, self-managed by the local developers and partly occupied by the building developers themselves, with just 50% - 75% of the area available for outside tenants.
Performance of Da Nang office market, Q2 2009 – Q2 2010
Source: Savills Research & Consultancy, Q2 2010
With all of these tendencies on the market, in the second quarter, average rent rate was US$11 per square metre per month, decreasing 6% quarter on quarter.
Villa & Apartment For Sale: Most clients are from Hanoi
The second quarter saw two new villa projects come online: Dune Residence, supplying 15 villas; and Vinpearl Da Nang, supplying 39 villas to the market. Currently, there are eight villa projects with more than 600 villas in Da Nang’s villa for sale market. All of these projects are located along Da Nang Beach, Ngu Hanh Son District. The average primary price of projects selling villas ranges from US$800-US$3,900 per square metre. The price per unit of villas depends mainly on their location and view. Beachfront villas are specially atracting.
Wealthy Vietnamese are the major target purchasers for villas. Purchasers from Ha Noi accounted for the highest rate of those surveyed, approximately 80%, while purchasers from HCMC only accounted for 13 percent. The remaining 8% consist of foreigners, overseas Vietnamese and wealthy Vietnamese from other provinces of Viet Nam.
Two new apartments for sale projects were launched to the market in Q2 2010: Bau Thac Gian and Vinh Trung Plaza. Now, there are 11 apartments for sale projects with 2,300 units in the market. The apartment for sale market in Da Nang is concentrated in four districts: Hai Chau, Thanh Khe, Ngu Hanh Son and Son Tra. The average primary price of projects selling apartments is ranging from US$750 - US$3,000 per square metre. Similar to villa market, high proportion of buyers are from Ha Noi.
Market performance of apartment for sale projects by district, Q2 2010
Source: Savills Research & Consultancy, Q2 2010
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