The market segment for offices and retail space for lease in Hanoi has seen stable rental prices for grade A and B office buildings in the third quarter of the year, according to the CB Richard Ellis Vietnam, Co., Ltd (CBRE) – the world’s largest commercial real estate services and investment terms.
The rental price of A-class offices was 24.1 USD per square metre per month (excluding taxes and service fees), representing a year-on-year increase of 8.6 percent due to limited supply. Meanwhile, that of grade B buildings was 13.7 USD per square metre per month, up 1.4 percent from the same time last year.
Notably, there was no new project in the third quarter. The CBRE said that the total supply of office for rent was around 1.2 million squares metres as of the third quarter, including 66 percent of B-class offices.
Occupancy of both grade A and B offices in the period was high, at 89 percent and 84 percent, up 0.1 percentage point and 1.4 percentage points, respectively, from the previous quarter.
Net absorption during July-September was 13,000 square metres. Most of the demand for offices came from finance, banking, production and real estate sectors that want to branch out business or change offices.
In addition, demands for new working space of both domestic and foreign business have been on the rise.
As new A-class offices will not be rolled out into market until the end of 2018, rosy signs are expected for existing buildings in the coming time.
Troy Griffths, Deputy Managing Director of Savills Vietnam, said that office rental fees in Vietnam are rather modest as compared with other regional countries. However, the costs are forecast to scale up in medium term as office occupancy is nearly full, making it difficult for businessmen to find space.