How is Vietnam’s Office Real Estate Market Positioned?
Vietnam’s office market is a thriving real estate market, with both domestic and foreign brands offering office spaces in categories like Grade A, Grade B and Grace C. Boasting an average occupancy rate of ~%, Vietnams shows strong potential in terms of demand and increasing Rental Rates reflect that Landlords are also benefitting in the market. Vietnam’s GDP in 2018 amounted to USD ~ billion and GDP per capita amounted to USD ~, in 2018, indicating greater ability to own and rent Luxury and Grade A office properties. These factors point towards the scope and profitability of the office market in Vietnam.
Vietnam’s office real estate market has been growing at a CAGR of ~% which indicates the market still has room to grow. Rental rates witnessed some fluctuation but started increasing again by 2018. As market trends like the emergence of Co-Working and rising number of business migrating from China to Vietnam continue, the Office real estate market in Vietnam is expected to grow strongly.
Key Trends in the Office Real Estate Sector in Vietnam
Decentralization among Tenants: Decentralization is a trend noticeable among the major cities of Vietnam, namely, HCMC and Hanoi. In both cities, tenants are moving from the older CBD (Central Business Districts) to newer business areas – Midtown and the West in Hanoi, where has the largest future supply. Another reason for this shift is the availability of larger and more affordable spaces in the Non-CBD Area.
Co-Working Spaces Gaining Traction:- Co-working spaces are gaining traction since traditional office spaces are limited. Co-working space providers have rented ~ SQM in some of HCMC’s newest office buildings. The demand for co-working space keeps increasing since grade A office supply continues to be limited, and businesses struggle to find large space.
Landlord Dominant Scenario:- The Vietnamese office market showcases dominance of Landlords in terms of the rent charged for leased office spaces. Supply of office spaces in popular business districts in HCMC and Hanoi are limited, so a trend of inflated rent in these areas has been observed. Companies have to accept the hike or relocate.
Current Office Demand and Supply
Market supply in Vietnam took a major slowdown in 2015, due to shortage of supply in Hanoi, 2015 onwards. That slowdown can be attributed to projects not getting approvals for construction. Even still market supply has been steadily increasing due to HCMC’s contribution to the supply.
Vietnam’s Office real estate’s demand witnessed a steady increase due to the increasing number of business starting operations in Vietnam, however growth rates witnessed steady decline due to rising rental rates, across the country’s business centric states.
How is Vietnam’s Residnetial Real Estate MARKET Positioned?
Vietnam’s Residential Real Estate market has been under the eye of investors since 2015, when the Real Estate Housing law was enacted. Ever since foreign investors have been flocking to Vietnam, be it Chinese or Korean investors, looking to invest in Residential Real Estate in hope of stronger returns over the years. Vietnam’s Residential market has been growing at the rate of ~ % from 2013-2018 when the market showcased signs of recovery. With rising population and increased investments within the market, Vietnam Residential Market is expected to become a hotspot among the Asia-Pacific countries.
Vietnam’s residential real estate market is divided into three further categories namely: Apartments, Residential and Villas & Townhouses. Each of these categories have showcased strong CAGRs over 2013-2018, among which Villas showcased the highest growth, followed by Apartments and Townhouses. Proptech and the flexible millennial lifestyle are some trends that will affect the market in the coming future.
Key Segments Covered:-
Vietnam Office Real Estate Market
By Type:
Grade A Office
Grade B Office
Grade C Office
By Geography:
Vietnam
Ho Chi Minh
Hanoi
Vietnam Retail Real Estate Market:-
By Location:
CBD (Central Business District)
Non CBD (non central business district)
By Type:
Retail Podium
Department Store
Shopping Center
By Geography:-
Vietnam
Ho Chi Minh
Hanoi
Vietnam Residential Real Estate Market:-
By Type:
Apartments
Condominiums
Villas and Townhouses
By Geography:
Vietnam
Ho Chi Minh
Hanoi
Vietnam Hotel Real Estate Market:-
By Type:
3 Star Hotels
4 Star Hotels
5 Star Hotels
Others (Less than 3 Star Hotels)
By Geography:
Vietnam
Ho Chi Minh
Hanoi
Key Target Audience:-
Real Estate Developers
Independent Investors
Real Estate Consulting Companies
Third Party Real Estate Companies
Independent Architects
Government Associations
Government Agencies
Time Period Captured in the Report:-
Historical Period – 2013 – 2018
Forecast Period – 2019F – 2025F
Case Studies Covered:-
Vietcom Bank
Deutsches Haus
Diamond Plaza
Vincom Centre
Rever.vn
Emerge
Ohana.vn
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