Average gross rents for retail floors decreased in both Hanoi and HCMC

By Chi Hao - Jan 14, 2018 | 07:00 AM GMT+7

TheLEADERAccording to Savills, the demand of the retail sector increased in Hanoi, while Ho Chi Minh City (HCMC) experienced a surplus in supply.

Average gross rents for retail floors decreased in both Hanoi and HCMC
The occupancy rate of Hanoi's retail sector nearly reached 100 per cent in 2017. (Photo: Savills)

Hanoi’s total stock for retail was approximately 1.3 million square meter, up 1.2 per cent quarter-on-quarter and 6.0 per cent year-on-year. Nearly 19,000 square meter was added from three new retail podiums.

Savills noted that the average ground floor rents decreased by 2.0 per cent quarter-on-quarter. The occupancy rate maintained its upward trend with 2.6 ppts quarter-on-quarter growth. Both the shopping center segment and the secondary trade area saw the most improved quarter-on-quarter and year-on-year occupancy rates.

Thirteen new projects are scheduled to launch in 2018, which are expected to provide 229,000 square meter. The West area of Hanoi is seeing robust development of real estate projects.

In comparison, according to Savills, the total stock of HCMC was approximately 1.2 million square meter, nearly equal to Hanoi, with 24,200 square meter added from three new supermarkets and one shopping center opening. Three closures withdrew 11,100 square meter.

The average gross rent decreased by 3 per cent quarter-on-quarter. The average occupancy rate slightly decreased by 1ppt, lower than one of Hanoi in all three segments. The rents in the region outside central business districts (non-CBD area) decreased in the face of surplus supply to safeguard the occupancy rates.