Outlook of local property market is good
A report from the US based CB Richard Ellis (CBRE), which manages a dozen high-rise building projects across Vietnam, says that Hanoi and Ho Chi Minh City were experiencing “unusually” high occupancy rates compared with the rest of Asia and this trend should continue over the next three to four years.
The outlook of the local property market is good if you look at the number of projects and the very unusual high occupancy rates in Ho Chi Minh City and Hanoi, the managing director of CBRE, Marc Townsend, said.
Vietnamese developers are obviously leading the race - they have capital, energy, determination and some excellent sites. This is a very promising market place compared with the rest of Asia, he said.
According to CBRE’s latest market updates, Hanoi’s office occupancy rate has reached an average 88 percent, while HCM City’s has climbed to 84 percent. Office rental prices in Hanoi stand at U$26.67 per square meter and at U$$26.2 per square meter in Ho Chi Minh City. Vietnam’s office rental costs are even higher than places like Hongkong ($23.8), Singapore ($25.5) and Bangkok ($12), said Townsend. This could be explained by the current shortage of office space, but new supply in the next two years will soften the rental rates, particularly in Grade B buildings, he added.
Regarding the retail market segment, he said the future market boom would be partially caused by an influx of international retailers over the next few years.
New retailers are coming, including some big brand names like Mango, Dunhill, Prada and Benetton, to open their shops in towns. This trend will mean the presence of hyper market operators, department store chains, and fast food restaurants. While some retailers have been operating locally for some time, many will come to Vietnam for the first time, he said. Garment retailer Benetton of Italy recently announced the group would soon open its first store in Ba Trieu Street of Hanoi, in the newly developed Vincom City Towers, following the opening of two stores in Ho Chi Minh City.
The market for residential homes was also growing rapidly. The residential housing market is going to be very competitive, Twonsend said.
Tran Quoc Quynh
VNECONOMY updated: 19/10/2004
