Da Nang property market saw better performance in H1

Retail: Better performance

In the second quarter of this year, total retail stock remained stable quarter-on-quarter (q-o-q) but fell 5.7% year-on-year (y-o-y) as Nguyen Kim supermarket temporarily closed for renovation in the last quarter. The average rent rose 7.3% and 11.5% on quarterly and annual basic, respectively. Meanwhile, retail podiums and department stores saw a rise of 19.2% and 13.1% q-o-q. In shopping centers, rent dropped 2.8%. 

Besides, the average occupancy went up 1.9 ppts q-o-q and 0.9 ppt y-o-y. Retail podiums climbed significantly by 24.7 ppts and department stores slightly rose by 0.8 ppt q-o-q, while shopping centre occupancy declined 0.4 ppt. In the second half of 2016, a new project is expected to enter the market with 18,000 sqm. Next year, two more projects will also add approximately 15,000 sqm to the market.

Office: Stable stock

The total office stock was stable in Q2- 2016 while average rent increased 2% q-o-q but decreased 5% y-o-y. Meanwhile, average occupancy was up 2 ppts q-o-q and 9 ppts y-o-y. Occupancy of Grade A dropped 2 ppts both q-o-q and y-o-y while that of Grade B rose 4 ppts q-o-q and 3 ppts y-o-y. Occupancy of Grade C was stable q-o-q but climbed significantly 15 ppts over the same period of last year.

Thanks to the good performances of Lilama 7 Building, Danang Book and Green Plaza, the total leased area was around 79,170 sqm, an increase of 2% q-o-q and 11% y-o-y. Since Da Nang aggressively encourages start-ups, demand for office space is expected to rise. During Jan-May period, 2,015 new businesses were registered. 

Hotel: Increasing volume of international visitors

In Q2, due to the entrance of one 4-star and three newly ranked 3-star hotels, hotel stock climbed 4% q-o-q and 15% y-o-y. The average occupancy increased 2 ppts q-o-q but declined 8 ppts y-o-y. 

Statistics of Da Nang Tourism Department showed about 795,646 international visitors came to the central city in Q2-2016, rising by 29.7% over the same period of last year. 35 future projects are planned to enter the market from Q3 onward. In addition, 3 new projects will provide 1,320 rooms in the second half of the year.

Villa and apartment: Improved sales

With 17 projects adding 410 dwellings to the primary market in Q2, the total villa stock remained unchanged q-o-q but soared 33% y-o-y. Similarly, apartment stock was also stable q-o-q but rose 7.4% y-o-y with 575 units from 12 projects entering the primary market. The largest supplier was Son Tra district, accounting for 58% market share, followed by Hai Chau with 39%. 

Reportedly, the lowest primary apartment price (VND15 million/sqm) was seen in Hai Chau while the highest (VND69 million /sqm) was in Ngu Hanh Son. In field of villas, both the lowest and highest primary price were recorded in Ngu Hanh Son, at VND22 million/sqm and VND54 million/sqm respectively. 

Thanks to developer reputation, proximity to the beach and construction progress, property price in Da Nang continues upward trend. According to Savills, a large supply of more than 7,000 apartments/ condotels is expected toward the end of 2018.

Source: Nhip song thoi dai