Research &

Forecast Report
Yangon | Condominium Market
4Q 2014

Project launches increase despite

weakening take-up rate
Developers remained confident as project launches continued
to soar in 2014, hitting a new record high of 4,150 condominium
units, tripling over the past two years. However, the market
appears less optimistic as the overall sales performance
weakened for the year. The average take-up rate declined by a
substantial 12 and 15% from 2013 and 2012, respectively. Colliers
predicts that the rate will further decline in 2015 as new largescale developments will be revealed along with the sales opening
of new residential phases in on-going projects. At present, the
total unsold inventory from all pre-selling projects is estimated
at 3,310 units, up by over 2,100 units YoY.

Accelerating success.

Forecast Direction
4Q 2014 4Q 2015

New Supply
Take Up Rate
Selling Price

2014 project launches hit new record

high
The number of newly launched condominium developments
reached a new record high in 2014. Some 37 new projects
initiated pre-sales during the year, translating to some 4,150
units, a significant increase of 76% YoY, and triple the growth in
2012. Local developments continued to lead the number, while
large-scale foreign-invested projects are beginning to represent
a considerable share.

Newly Launched Condominium Units

Source: Colliers International Myanmar

One of these is Dagon City 1, which initially launched the first

phase of its mixed-use project in 3Q 2014. Occupying a 22-acre
Build-Operate-Transfer (BOT) piece of land, the integrated
development will consist of mid-rise residential and commercial
buildings, estimated to be completed within the span of three
years. Of the first condominium block, some 300 units were
reportedly reserved. An additional 288 units are slated to be
launched in the next three months following the announcement
of the second phase, while the sales of the remaining two phases
will be opened successively.
Launched earlier in 2014, Golden City likewise consists of a
considerable amount of stock represented by nine 33-storey
residential towers. The first phase includes four buildings, each
with 126 units. The sales reservations for the remaining towers is
expected to commence after with some 940 units.
The foreign interest in joint venture deals continues to heighten
with new big-ticket integrated projects expected to be revealed in
the near future. This suggests an increasing stock of international
quality condominiums going forward. Colliers predicts that
local developers will start reviewing business plans, and redesign project schemes and technical specifications, in order to
compete with the increasing competition. In fact, others have
moved ahead by engaging international property specialists (real
estate consultants, architects and engineers) to gain leverage.

This trend has been reinforced with launches in the second half
of 2014, as some locally developed projects (backed by foreign
consultants) are beginning to adopt international standard
designs and technologies. This includes sizeable condominiums,
such as The Illustra at Pho Sein (PSWN Development Company
Limited) in Tamwe Township; Sanchaung Garden Residence
(Sanchaung Garden Development Group) in Sanchaung
Township; and Royal Sayarsan Condominium (Than Htike Lu
Gems, Mineral & Construction Co. Ltd and Linn Yi Construction
Co. Ltd) in Bahan Township, all of which are located in the Inner
City zone.
By location, the Inner City zone registered the highest number
of new launches in 2014, and is now nearly at par with the Outer
City in terms of the total units launched since 2009. The latter
is being largely represented by the large-scale project, Thanlyin
Star City.
Owing to the centrality of the location, coupled with the
availability of attractive developable plots of land, future launches
in the Inner City are expected to trend upwards. However, largescale mixed-use development is seen to surface in the Outer City
zone where larger land plots are available.

Research & Forecast Report | 4Q 2014 | Yangon | Condominium Market

Over 2,400 units to be completed

annually

Notable Pre-Selling Condominium Take-up Rate

Due to the rise in project launches, Yangons high-rise residential

landscape is expected to take shape rapidly in the next three
years. In fact, as of the end of 2014, the total completed stock
of notable condominiums rose by 72% YoY to 2,681 units. The
number will almost double in 2015 with some 5,081 units slated
for completion.
The city will witness an average of 2,400 new units completed
annually from 2015 to 2018, a remarkable increase in new supply
versus that from 2011 to 2014, when the yearly average was 530
units. This development has begun to become evident, especially
with the recent completion of Thanlyin Star Citys Zone A in
2014. From 2016 to 2017, the other large-scale projects, namely
Golden City (Golden Land); Dagon City 1 (Marga Landmark);
Capital City (Capital Development Ltd); and Time City (Crown
Advanced Construction), will begin to surface.

Supply Stock - Notable Condominium

Developments

Source: Colliers International Myanmar

Dwindling take-up rates most likely

to continue

Source: Colliers International Myanmar

However, on a quarterly basis, the average take-up rate was up

by 6%, mainly fuelled by the strong sales performance in newly
launched projects in the Downtown area. The take-up rate in the
area similarly grew by a substantial 20% YoY amid limited sales
launches. Nonetheless, this was inadequate to help buoy the
citywide rate for the year, as sales in other locations remained
challenged. In particular, the rate in the Outer City zone dropped
significantly by 18% YoY caused by sluggish sales of low-quality
developments, mostly on the fringes of Thuwanna, Tamwe
and Thingangyun Townships. Though the take-up in the Inner
City zone dropped by 7% YoY, key selected developments have
recorded sturdy performance with over 15% monthly sales
velocity.
At present, the total unsold inventory from all pre-selling projects
is estimated at 3,310 units, up by over 2,100 units YoY. With the
announcement of new large-scale projects in 2015, coupled with
the launch of new phases in on-going projects, Colliers predicts
that the sales take-up rate will further decline, at least in the near
term. Moreover, the election uncertainty will temporarily mute
project launches in the latter part of the year as investors and
developers take a wait-and-see approach. This may potentially
narrow the gap between take-up and sales moving forward.

Despite the developers bullish market sentiments, the

sales performance of pre-selling condominiums dampened
significantly as of the end of 2014. The average citywide take-up
rate registered a dismal 68%, compared to 2013s 80% and 2012s
83%. The substantial rise in project launches coupled with the
weakening sales velocity of inferior quality developments caused
the drag in the overall sales take-up. Moreover, the relatively
high selling price, owing to large unit sizes, continues to deter
purchases from the untapped majority of owner-occupiers,
and from investors seeking rental potential amid the growing
number of single expatriates in Yangon.

Research & Forecast Report | 4Q 2014 | Yangon | Condominium Market

Selling price to remain stable, at least

in the near term

Average Sales Price by Segment (USD/SQ M)

As of the end of 2014, there were roughly 54 pre-selling projects

in Yangon. Of these, 65% are categorised as upper mid-market
segment. The number of high-end and luxury projects represent
26% of the total, and the rest were classified as mid-market.
The average selling price for the luxury segment was USD5,077
psm. This translates to about USD610,000 for a typical twobedroom unit. The average price for high-end developments
was USD3,842 psm. The majority of the pre-selling upper-mid
market projects were selling at between USD2,300 and 3,900
psm, while, the mid-market average price was USD1,895 psm.
The expensive land prices and high cost of construction are
putting upward pressure on selling prices. However, the
growing competition, particularly in the upper-mid to highend segments, on the back of the lowering levels of take-up rate
suggest that the average sales price will be stable in the near
term, but is in for a correction once launches continue to exceed
demand going forward.

485 offices in
63 countries on
6 continents

United States: 146

Canada:
44
Latin America: 25
Asia:
38
ANZ:
148

$2.1

15,800

billion in
annual revenue

1.46

billion square feet

under management

EMEA:

professionals
and staff

84

Source: Colliers International Myanmar

Karlo Pobre
Manager
Research & Advisory
+95 (0) 931 336 099
karlo.pobre@colliers.com
Theint Theint Thwin
Researcher
Research & Advisory
+95 (0) 950 267 22
theint.thwin@colliers.com
Tony Picon
Managing Director | Myanmar
+95 (0) 942 103 4026
antony.picon@colliers.com

Copyright 2015 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.

Colliers International
Myanmar
Unit 7/C (6th Floor)
White Cloud Building,
No. (138/142) Thein Phyu
Road, Botahtaung Township
Yangon Myanmar
TEL +95 (0) 931 491 678