knight frank retail - tiger talk june 2011

16th June 2011

Shopping Mall –

Golden Rules In Design

Presented by

Knight Frank Vietnam

Viet Nam

Outline

I. Changing of Vietnamese shopping habits

II. Hanoi retail market update

III. Moving to Shopping Centres-Local retailers’ positive trend in Hanoi

IV. Proactive movement towards modern retail formats

V. Golden rules for a successful shopping centre

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I. Changing of Vietnamese shopping habits - Hanoi

Hanoi:•Population: 6.5 million people•20-24 age group= 25% population•9% of total Vietnam GDP

Vietnamese retailing industry needs “big guys”(Vietnam Business & Economy News, 6th of June 2011)

“Investors will keep injecting money in retail”(Vietnam News, 24th of January 2011)

0

200000

400000

600000

800000

1000000

1200000

1400000

Vietnam Consumer Spending 1995-2009

Hanoi- Consumer Spending in Billion VND

Vietnam Consumer Spending in Billion VND

Source: Ministry of Trade

• Hanoians have a collective mindset

• The role of advertising is critical in Hanoi

• Price promotions is the most appeal to Hanoians

• Tougher economy impacted does not affected Hanoians’ consumption habits

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I. Changing of Vietnamese shopping habits - Hanoi

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II. Hanoi Retail Market update

•Total Retail Space is 456,000 sqm

•Average Occupancy: 93%

•Shopping Centre in CBD achieve 100% occupancy

Rental Rate by Retail Projects

Source: Knight Frank Market Research

In U

SD

Max rate

Min rate

•Highest rates achieved in CBD is $185/sqm/month

•Retail sales is expected to increase by 23% compare to 2010

•Rental rate is more stable in Hanoi compare to HCMCShopping Centre Department Store Hypermarket

*Survey includes Department Stores & Shopping Centres

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• Trend of retail lease space turn to long term investment.

Mo Market Commercial Center: 25,000 sqm

Hang Da Galleria: 7,000 sqm

Keangnam Retail Podium: 10,000 sqm

• Incredible promotion campaigns on rental price to attract new tenants move to non-CBD area

Shopping Centre/

Department store/

Hypermarket 47%

Electronic mart 18%

Wholesales 13%

Retail podium

4%

Supermarket18%

Retail market share by square metre QII 2011


77

2011

PICO Mall

Vincom Village

Keangnam

IPH

Icon 4

Habico

Significant New Supply 2011-2013

SAVICO Plaza

2012 2013



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III. Moving to Shopping Centres – Local Retailers’ Positive Trend in Hanoi

Percentage figures are based on retail brands surveyed in the following retail objects in Hanoi:

Parkson Viet Tower, Vincom City Towers/ Galleries, The Garden Mall, Fodacon Building, Grand Plaza

Domestic International

77%

23%

Domestic vs. International Brands

0%

10%

20%

30%

40%

50%

60%

70%

80%

90%

100%

Jewelry Cosmetics Textile Shoes & Handbags

International

Domestic

Domestic vs. International Brands in

selected segments

Customers

✓Security & Cleanliness

✓ Air conditioning

✓ Parking opportunity

✓ Common opening times

✓Occasional& seasonal events

✓ Entertaining features (cinema, food court,

etc.)

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IV. Proactive Movement Towards Modern Retail Formats

Retailers

✓ SC increases length of customers stay

✓ SC increases higher turnover

✓ Retailers benefit of tenant mixture

✓Retailers benefit from SC marketing

✓ SC targets all types of consumers

✓ Architectural attractive location

✓ SC is recognised as one shopping

destination

Shopping Centres create advantages for…

…to provide comfort & suitability which reflect the consumers modern lifestyle

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Location Anchor Tenant Feasibility Study

Tenant Mixture

Centre attainabilityCentre Design

Centre Management

Effortless Business

Qualified and experienced management posses knowledge which contributes to the centre’s success

Study must include socio-economic, financial, marketing and physical targets

The greater the tenant’s market share, the more positive the tenant’s influence on the centre’s image

Although a great location may not guarantee success, a bad location will almost always guarantee failure

Ratio of domestic & international brands must match consumers preferences in terms of products, quality and price

As consumers’ time becomes more valuable, SC should provide easy navigation for shoppers inside the centre

Centre’s atmosphere must invite visitors to spend a maximum of time

SC must provide a convenient access for shoppers – adequate transportation links, parking and opening times

V. Golden Rules For a Successful Shopping Centre

Factors that decide over

Shopping Center’s level

of success

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Thank you for your attention

Present by Mr John Gallander

Country Managing Director

Special Thanks to Mr. Gregor Tatsios

Viet Nam – Track Record

THE GARDEN SHOPPING CENTER, HN

Total Area: 57,000 sqm

Developer: Bitexco Land

Type: Shopping centre

Service provide:

Exclusive marketing agent

KHAI THONG PLAZA, D1, HCMC


Developer: Phuong Trang Investment Corporation


Service provide:

Market research & consultancy

Viet Nam – Track Record

THE FLEMINGTON TOWER, D.11, HCMC


Developer: Bao Gia Joint Stock Company


Service provide:

Consultancy & leasing agent

THIEN SON PLAZA, D7, HCMC


Developer: Thien Son Co.,


Service provide:


Singapore -Track Record

ORCHARD CENTRAL

Total Area: 38,000 m2

Developer: Far East Organization


Service provide:


ILUMA

Total Area: 28,000 m2

Developer: Jack Investment


Service provide:


AMK HUB


Developer: Singapore Labour Foundation , NTUC Income & Fair Price


Service provide:

Management

SUNTEC CITY MALL


Developer: Suntec REIT


Service provide:


Singapore -Track Record

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Find us

• Knight Frank Vietnam – Hanoi Office

• 5th floor – 40 Phan Boi Chau Street

• Hoan Kiem District, Hanoi

• Tel: (844) 3 9411 638

• Fax: (844) 3 9411 639

• Knight Frank Vietnam – Ho Chi Minh Office

• Suite A, 7th floor VTP Office Building

• 8 Nguyen Hue Blvd

• District 1, Ho Chi Minh City

• Tel: (848) 3 8226 777

• Fax: (848) 3 8277 856

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knight frank retail - tiger talk june 2011

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