QUARTE

21

ECONOMIC OVERVIEW
Quarter 2 | Da Nang
Quarterly Report | Colliers International

GDRP
Danang is facing many challenges as key economic sectors which made major contributions to the city’s development
were seriously affected by COVID-19. The GRDP of Da Nang in the first six months of 2020 decreased by 3.61% over
the same period last year. It had been 23 years since this city had recorded a negative GRDP rate.
CPI
The average CPI of Danang in the first half year increased by 4.42% compared to the same period of 2019. Some notable
industries recorded growth rate were food & beverage, education and healthcare. On the other hand, there were also
groups of goods and services witnessed a decrease in the average CPI such as transportation, entertainment and
tourism, post and telecommunication.
FDI
The total FDI in Q2 2020 was estimated to reach 102.9 million USD, increasing by 28,7% compared to the same period
last year. This growth resulted from big projects calling for investment in 2019. Some notable projects are Mikazuki Spa
& Hotel Resort and Sunshine Aerospace Components Factory.
Retail
Due to the social distancing period, the demand for spending on goods and services of many industries reduced in this
quarter, resulted in the total retail sales decreased by 5.6% compared to the last quarter and 6.8% compared to the same
period last year.
International Arrivals
As mentioned, Danang tourism economy suffered heavy damages as the number of international visitors to Danang
declined considerably in the first half year with only 627 thousand arrivals. Due to the complicated and unpredictable
situation of COVID-19, the possibility that the number of visitors went back to its normal state seemed to be very unlikely
to happen in the near future.
Trade Balance
Similar to HCMC and Hanoi, the export turnover and import turnover decreased sharply since COVID-19 had spread
strongly in many countries which were top trading partner of Vietnam such as America and China. In Danang, it was
estimated that the total export turnover reached 318.6 million USD (decreased by 23,7% compared to the same period
last year) and the total import turnover reached 258.7 million USD (decreased by 21,4% compared to the same period
last year).

Figure 1: Vietnam Export-Import 2015-2021F Figure 2: Vietnam International Arrivals, 2015-2020F

Exports Imports Trade Balance International tourist arrivals Growth rate

300 20 40%
Source: Colliers International
250 30%
15
million arrival

200 20%
USD billion

150 10 10%
100 0%
50 5
-10%
0
0 -20%
2015 2016 2017 2018 2019 2020F 2021F
-50 2015 2016 2017 2018 2019 2020F

Source: Colliers International Source: Colliers International

 5

OFFICE – DA NANG

Quarterly Report | Colliers International

Quarter 2 | Da Nang
Performance: Some were able to return to Figure 3: Danang office, market performance
normal state
Because of the government’s great effort to fight COVID-19, some Average Rent Occupancy Rate

businesses were able to back to their normal states. Some foreign 25 100%

companies even continued to open their new offices to Da Nang 20 90%

USD/sqm/month
this quarter such as Ubisoft and Generali. However, not much
15 80%
increase was observed in the performance of Da Nang office
market. 10 70%

Supply: No new supply 5 60%

Da Nang office market witnessed no new supply in both grade 0 50%

A and B. Since countries around the world still struggled to cope Grade A Grade B Grade C

with the COVID-19, developers were wary about the Source: Colliers International
possibilities for office expansion of many companies.
Consequently, it was likely that no new supply from office Figure 4: Danang office, market performance
segment would be provided in the near future. trend

Demand: No intention to expand business Average Rent Occupancy Rate

Negative impacts of COVID-19 brought about the decline 15.0 100%

in office space demand, resulted in the average occupancy

80%
USD/sqm/month

rate reduced from 85% to 82.1 % compared to the 10.0

60%
previous quarter. The operation of many businesses were not
quite effective; therefore, it seemed like they had no intention to 40%
5.0
expand their businesses in the meantime.
20%
Outlook: Both supply and demand were likely
0.0 0%
to remain the same in upcoming time 2017 2018 2019 2020F

Overall, office market in Da Nang were affected by Covid 19

Source: Colliers International
outbreak. Based on the fall in average occupancy rate, it is
projected that the growth of both supply and demand were likely
Figure 5: Danang Office, Market Supply
to stay unchanged in the near future.

9.18 10.35

80.47

Grade A Grade B Grade C

Source: Colliers International

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4

Table 1: Danang Office, Notable Properties

Average
Completion NLA Service Occupanc
No Name Address asking rent
Quarter 2 | Da Nang
Research & Forecast Report | Colliers International

Year (sqm) Charges y rate

(USD/sqm)

1 Indochina Riverside Tower 74 Bach Dang, Hai Chau 2008 6,219 Inc. 70% 22.0
2 Hilton Bach Dang 50 Bach Dang, Hai Chau 2018 15,623 Inc. 75% 50.0
Grade A
115 Nguyen Van Linh,
1 One Opera 2013 4,234 Inc. 75% 12.0
Hai Chau
253-255-257 Hung
2 Vinh Trung Plaza 2008 5,200 Inc. 70% 14.0
Vuong, Hai Chau
3 Softech Tower 02 Quang Trung 2009 20,000 Inc. 82% 14.2
Lot A2.1, 30/4 Street, Hai
4 PVFC Building 2010 11,162 Inc. 100% 10.0
Chau
5 Green Plaza 238 Bach Dang, Hai Chau 2010 4,400 Inc. 80% 16.0
135 Nguyen Van Linh,
6 Thanh Loi Building 2011 5,100 Inc. 93% 12.0
Thanh Khe
155 Nguyen Van Linh,
7 Post Office 2014 8,500 Inc. 100% 12.0
Thanh Khe
8 Crystal Tower 65 Hai Phong, Hai Chau 2020 8,298 Inc. 30% 15.0
9 Petrolimex Tower 122, 2/9 Street, Hai Chau 2013 6,000 Inc. 100% 10.0
Grade B
1 DanaBook 78 Bach Dang, Hai Chau 2008 3,500 Inc. 90% 13.0
Z85 Tran Hung Dao, Son
2 SPT 2009 15,863 Inc. 94% 8.0
Tra
Grade C
Source: Colliers International
 5

RETAIL – DA NANG

Quarterly Report | Colliers International

Quarter 2 | Da Nang
Performance: Both occupancy and price Figure 6: Danang Retail, Market Performance
decreased
Average Rent Occupancy Rate
Overall, the performance was not much different from Q1 30.00 100%
2020 as the real estate market in almost all segments had
25.00
been impacted negatively since the middle of last year. 95%
20.00

USD/sqm/month
Moreover, the decrease in number of tourists for a half year
due to COVID-19 have led to the gloomy retail market. 15.00 90%

However, there was a slight difference in the rent price, for 10.00
85%
example project Indochina Riverside Towers, raising their 5.00
average rent price from 22.5$/m2 to 29$/m2 because of some
- 80%
changes in business strategies (focus on big brand tenants). Retail Podium Department Shopping center
Store
Supply: No new supply Source: Colliers International
Up to this point, total NLA of retail sector remained the same
with approximately 114.730m2, including 12.450m2 retail Figure 7: Danang Retail, Market Performance
podium, 8.000m2 department stores and 94.280m2 shopping Trend
centers. Until Q2 2020 this figure had not increased because
Average Rent Occupancy Rate
there were no suppliers entering the market, almost all new
projects were on hold due to some legal problems as well as
15.0 100%
influences from COVID-19. Especially, Vien Dong Meridian
Tower project located in CBD had been revoked by the state 80%
USD/sqm/month

after many years delayed in construction. 10.0

60%

Demand: Decreased significantly 40%

5.0
Although some shopping malls were temporarily closed in the 20%
first month of the second quarter of 2020 (social distancing
0.0 0%
period), retail market showed signs of growing again. 2017 2018 2019 2020F
However, the development was not as strong as expected in Source: Colliers International
2019, due to the severe consequences that the pandemic
brought. The source of foreign tourists was constrained Figure 8: Danang Retail, Market Performance
because the international routes for foreign tourists had not Trend
opened yet, so the operation of the retail shops had not been
satisfactory.
Outlook: Quickly return to normal if Covid-19 is
under control
As Vietnam still remained closed to foreign tourists, many
businesses in Da Nang might focus on domestic travelers in
the following time. They need to adapt quickly so as to serve
this segment, for example changing or improving some
business products and customer service process. In addition,
landlords should share the issue with tenants so they are able
to maintain their retail stores instead of transform the entire Source: Colliers International

business structure into online business models.

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Table 2: Danang Retail, Notable Properties

Quarter 2 | Da Nang
Quarterly Report | Colliers International

Name of Completion NLA ARR Occupancy

No Address Location
Project/Building Year (sqm) (*) Rate
Indochina Riverside
1 74 Bach Dang Hai Chau 2008 5,251 29.0 90%
Towers
HAGL-Lake View
2 72 Ham Nghi Thanh Khe 2012 7,200 12.0 100%
Residences
Retail Podium
Parkson Vinh Trung 253-255-257 Hung
1 Hai Chau 2011 8,000 25.0 99%
Plaza Vuong
Department Store
1 Da Nang Square 35 Thai Phien Hai Chau 2011 3,280 6.25 79%
Vincom Plaza Ngo
2 910A Ngo Quyen Son Tra 2015 36,800 23.0 100%
Quyen
3 LOTTE Mart 06 Nai Nam Hai Chau 2016 19,200 19.0 99%
Ngu Hanh
4 VVmall 8 Vo Nguyen Giap 2019 35,000 25.0 80%
Son
Shopping Centre
Source: Colliers International
 5
7

CONDOTEL – DANANG

Quarterly Report | Colliers International

Quarter 2 | Da Nang
Performance: Lower selling price to raise Figure 9: Danang Condotel, Absorption Rate
demand by District

In April, tourism was considered as the industry which suffered

the most in COVID-19. Therefore, condotel market had been
affected significantly during this time. Specifically, the average
selling price of condotel projects decreased to $93/sqm
compared to 1Q2020. In addition, a number of legal issues
also put up to the decline in condotel market.

Supply: Projects handover could not be made

Source: Colliers International
The negative impact of the Corona virus delayed the handover
of projects. However, with the strength of tourism and policies
Source: Colliers International
to attract investment, it is expected that the future supply of
condotel will increase in the future.
Figure 10: Danang Condotel, Supply by
Demand: Negatively effected by the pandemic District performance trend

As well as tourism industry, hospitality industry was affected

Ngu Hanh Son Son Tra Hai Chau
severely. Demand for condotel went down since the number
of tourists was limited (Vietnam had not re-opened to foreign 8%
tourists).
42%
Outlook: Focus on domestic tourists
After the success of COVID-19 prevention activities, Vietnam 50%
Source: Colliers International
was identified as a safe destination. Therefore, Da Nang is
currently considered as a potential city and attracts attention
from many Asian countries such as Korea, China, etc. In
Source: Colliers International
addition, Da Nang is launching a stimulus package "Danang
Thank You 2020" aimed at attracting domestic tourists and
Figure 11: Danang Condotel, Guaranteed
foreign tourists after the epidemic. If condotel's policy is
Return
fulfilled by the government as well as the profits guaranteed
by the developers, the market will be restored and developed.

Source: Colliers International

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Table 3: Danang Condotel, Future supply

Quarter 2 | Da Nang
Quarterly Report | Colliers International

Completion
No Name of Project/Building Address Location No. of units
Year

1 Anh Duong Soleil 2 Pham Van Dong Son Tra Q3/2023 2,300
2 Monarchy Danang Tran Hung Dao Son Tra Q4/2021 2,100
3 Sunrise Bay Nguyen Tat Thanh Hai Chau Q2/2025 TBC
4 The Sang Residence 57 Pham Kiet Ngu Hanh Son Q2/2022 260
Source: Colliers International

Table 4: Danang Condotel, Notable Properties

Completion No. of Average Selling

No Name of Project/Building Address Location
Year units Price (USD/sqm)*

1 F Home 16 Dang Tu Kinh Hai Chau Q1/2016 560 1,600

105–107 Vo Nguyen Ngu Hanh
2 Ariyana Condotel Furama Q1/2016 1,320 2,534
Giap Son
Ngu Hanh
3 Cocobay Truong Sa Q1/2016 1591 1,917
Son
4 Vinpearl Riverfront Ngo Quyen Son Tra Q2/2016 736 2,203
Ocean Suites (Block Ngu Hanh
5 Truong Sa Q2/2016 115 2,394
A&B) Son
6 Wyndham Soleil Vo Nguyen Giap Son Tra Q4/2016 706 4,069
7 Hoa Binh Green Danang Le Van Duyet Son Tra Q4/2016 1,536 926
Ngu Hanh
8 Naman Garden Truong Sa Q4/2016 99 2,145
Son
A1 - A6 Vo Nguyen
9 Alphanam Luxury Son Tra Q4/2016 234 1,815
Giap
Source: Colliers International
 59

VILLA – DANANG

Quarterly Report | Colliers International

Quarter 2 | Da Nang
Performance: Selling price decreased Figure 12: Danang Villa, Market Performance
Till the end of the second quarter of 2020, Danang villa market
Sale Price Absroption
began to recover. Specifically, the selling price of villa projects 3,000 100%

recorded a decrise of 15% compared to the first quarter of 2,500 80%

USD/sqm
2,000
2020. However, in this quarter, new periods from previous 60%

Percentage
1,500
projects have recorded receive absorption rate from 95% to 40%
1,000
100%. This indicated that investors had strong interest in 20%
500
Danang villa market. - 0%

Supply: No new supply

The COVID-19 pandemic had a significant impact on the villa Source: Colliers International
market in Danang because new villa projects were delayed to
open. However, some projects launched in the first quarter Figure 13: Danang Villa, Primary Supply by
were sold out in the quarter and old projects are planned to District
open for sale in new areas of projects.

Demand: Negative impact from pandemic

Since May, even though domestic economic activities began
to return to normal state but due to the negative effect on
tourism industry, most buyerss did not consider this section as
a good investment this time.

Outlook: Hard to recover by the end of 2020

It is assumed that till 2025, there will be 1030 new villas from
4 major projects being added to the current supply. With the Source: Colliers International
success in controlling the pandemic in community so far by
the Government, the villa market in Danang is expected to Figure 14: Danang Villa, Primary Supply by
recover soon by next year. Meanwhile, 2020 may be a very Profile
tought time for the whole hospitality market in Vietnam,
5%
especially villas in Danang. 5% Ha Noi
5%

HCMC

85% Vietnamese
residing
abroad/Foreigners

Source: Colliers International

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Table 5: Danang Villa, Notable Properties

Quarter 2 | Da Nang
Quarterly Report | Colliers International

Name of Completion Number of Asking Price

No Developer Location Location
Project/Building Year units (USD/sqm)
1 Euro Village 2 Sun Group Hoa Xuan Ngu Hanh Son - 54 1,199
Ariyana Vo Nguyen
2 Furama Villas Ngu Hanh Son 2009 131 3,075
Corporation Giap
Vinpearl Luxury Da
3 VinGroup Truong Sa Ngu Hanh Son 2011 39 1,318
Nang 1
4 The Point Residences VinaCapital Truong Sa Ngu Hanh Son 2014 40 1,168
5 The Ocean Estates VinaCapital Truong Sa Ngu Hanh Son 2016 33 1,844
6 Euro Village Sun Group 27 Hoa Hong Son Tra - 175 2,400
Source: Colliers International

Table 6: Danang Villa, Upcoming

Completion Project area

No Name of Project/Building Developer Address Location
Year (ha)
Lodgis Hospitality
1 Anh Duong Soleil 2 Pham Van Dong Son Tra Q3/2023 15
Holdings Pte.ltd
2 Monarchy Danang FLC Group Tran Hung Dao Son Tra Q4/2021 42
3 Sunrise Bay Dat Quang Riverside Nguyen Tat Thanh Hai Chau Q2/2025 4
4 The Sang Residence Dat Xanh Mien Trung 57 Pham Kiet Ngu Hanh Son Q2/2022 2
Source: Colliers International

Copyright © 2020 Colliers International

The information contained herein has been obtained from sources deemed reliable. While every reasonable effort has
been made to ensure its accuracy, we cannot guarantee it. No responsibility is assumed for any inaccuracies. Readers
are encouraged to consult their professional advisors prior to acting on any of the material contained in this report.
RESEARCH AND ADVISORY
David Jackson Nhu Khuong
+84 906 925 935 +84 909 680 997
David.jackson@colliers.com nhu.khuong@colliers.com

Winnie Lam
+84 765 595 616
Winnie.lam@colliers.com

This report gives information based primarily on Colliers International data, which may be helpful in anticipating trends in the property sector.
However, no warranty is given as to the accuracy of, and no liability for negligence is accepted in relation to, the forecasts, figures or conclusions
contained in this report and they must not be relied on for investment or any other purposes. This report does not constitute and must not be
treated as investment or valuation advice or an offer to buy or sell property.
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Research & Forecasting