Apartment sales remain strong in Da Nang

Thursday, Sep 17, 2015 17:26

Beach resorts locate mostly in Son Tra district. 38 future projects will enter into the city's hotel market in the second half of this year. — Photo Cong Thanh

DA NANG (Biz Hub) – The Da Nang apartment market continued to show positive signs in the second quarter with absorption at 18 per cent compared to 11 per cent in the first quarter of this year.

A report from real estate consultancy Savills Viet Nam showed that projects by well-reputed developers and those near the beach and downtown generated good sales in the first half.

Savills said with another 13 villa and 21 apartment projects set to finish, 1,350 villas and townhouses and 17,600 apartments would hit the market in the remaining period of this year. Hai Chau District would remain the main location for apartments with a 75 percent market share and Son Tra peninsula would continue to have the largest villa supply.

Two villa projects, Premier Village Da Nang resort and Naman Residences, are offering for sale 150 more units in their latest stage in the second quarter.

This has increased the villa inventory to 890 units in 16 projects, of which the primary market accounted for 450 in 10 projects.

The property consultancy said villa absorption was 12 per cent due to the good sales performance by Premier. The average price was VND27.5 million (US$1,300) per square metre, up 9 per cent quarter-on-quarter (QoQ).

Most purchases were in the nature of investment or buying to lease.

The central city saw a 25 per cent year-on-year (YoY) increase in tourist arrivals in the first half to 2.23 million. The number of international visitors was 600,000, an increase of 33 per cent, while domestic visitor numbers rose 22 per cent.

A view of De Bay hotel in the Ba Na Hills Mountain resort in the central city.

In the hotel segment, there were 7,050 three- to five-star rooms, a 10 per cent QoQ and 32 per cent YoY rise.

The increase was a result of the official ranking of eight hotels.

Three-star hotels accounted for 3,050 rooms, accounting for 43 per cent, followed by five-star (34 per cent) and four-star (23 percent).

The average rental rate (ARR) increased by 8 per cent YoY to VND1.78 million ($84.7) per room per night, while revenue per available room (RevPAR) grew 13 per cent YoY. ARR and RevPAR increased across the board.

The overall occupancy rate increased by 4 percentage points YoY to 74 per cent, while the three-star segment achieved the highest occupancy, followed by five- and four-star.

In the second half of this year 38 developments with approximately 8,570 rooms are expected to be completed.

By 2017 another 2,400 rooms would be added by eight new hotels, six of them in the beach area.

The number of visitors arriving in Da Nang by air in the first six months was 268,275, double the number in the same period last year.

The city has 23 direct international flights to destinations in Japan, Korea, Malaysia, Singapore, China, Hong Kong, Cambodia, and Europe.

Office supply

In the second quarter the total stock of office space was 86,500sq.m in 25 buildings, a 13 per cent increase QoQ and YoY.

Busy Hai Chau District continues to be the main supplier with 63,000sq.m in 20 buildings.

In the second quarter the average occupancy was 83 per cent, a 3ppts fall QoQ, while the average rent was down 2 per cent to VND213,500 ($10.1) per square metre per month.

The average grade A rent increased by 1 per cent QoQ, while both grades B and C saw a 1 per cent fall.

The Premier Village Da Nang resort relaunch its villa project in the central city. The city's village absorption was 12 per cent increase in the second quarter this year.

In the first six months of this year 1,495 new businesses were started with a registered capital of over VND6.06 trillion ($269 million).

Savills estimated that around 266,000sq.m in 18 projects would come into the market starting in the second half of this year though many have yet to announce launching dates.

In overall, only one new project is expected to enter the city's office market in 2015, supplying approximately 20,400sq.m

In the second quarter the retail sector saw a 24 per cent increase QoQ and 30 per cent increase YoY with a total availability of 167,000sq.m.

The figure was due to the entry of Vincom Ngo Quyen Da Nang, a mall on the Han River with an area of 40,000sq.m and costing VND900 billion (US$43 million). — VNS

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