return icon

COVID-19 yet to affect HCM City office space market

Though the COVID-19 pandemic has cast a shadow over the global economy, the HCM City office space market has not been badly affected this year,...


An office building in HCM City. The city’s office market has not been much affected by COVID-19. — File Photo


Though the COVID-19 pandemic has cast a shadow over the global economy, the HCM City office space market has not been badly affected this year, according to property consultancy companies.

A report from the CBRE said during the first quarter the city office market added one new grade B building, Friendship Tower on Le Duan Street, District 1, with a total net leasing area (NLA) of 13,700sq.m.

It took the total supply in the office market to 1.37 million square metres.

Though the market has yet to see a significant impact, CBRE said many tenants have asked landlords to cut rentals by 15-20 per cent to compensate their revenue loss. Landlords have agreed to delay rent payment but, if the pandemic situation worsens, could agree to cut rents.

If the outbreak is contained before June the rental growth outlook could still be positive, CBRE said.

But if the disease is contained only by September the outlook would be more bearish, with rents likely to decrease by 8-10 per cent as companies demand cuts.

“CBRE also recorded some delayed and cancelled transactions [scheduled for] the end of the third quarter as international tenants face difficulties in visiting potential sites,” CBRE said.

“Such travel restrictions will possibly lead to a decrease in absorption of new supply, especially with the HCM City office market expected to welcome more than 70,000sq.m of NLA by the end of 2020.

“Hence, the market vacancy rate will increase regardless of how soon the disease is contained. Should the disease be contained before June the vacancy rate will only increase from 7 per cent to 14 per cent. However, if the disease lasts until September the vacancy rate might increase to 14-16 per cent.”

Jones Lang LaSalle (JLL) said, “The impact of Covid-19 on grade A and B demand is still limited.”

Around 68,700sq.m of new office space was completed in the first quarter, mainly in grades B and C, bringing the office stock to more than 1 million square metres in each category.

Most of the successful deals in the first quarter were negotiated before the epidemic and so the impact of COVID-19 on demand in grades A and B is still limited.

Companies have said that the outbreak is an outstanding opportunity to switch to flexible workspace and decentralised office buildings. During times of such economic and business disruptions, most bear significant rental costs while not generating much revenues, while large tenants realise that business discontinuity could occur if they have only one office during lockdowns.

“After the COVID-19 pandemic, the office market will be shaped by new trends in which tenants will prioritise agile working options,” Dương Thuỳ Dung, senior director of CBRE Vietnam, said.

“Tenants will prioritise agile working options like leasing flexible workspace or distributing workforce to various offices across the city.

“Tenants will start to pay more attention to their employees’ wellness instead of focusing too much on saving rental costs like before. LEED-certified buildings that comprise wellness features such as environment-friendly spaces, quality ventilation systems and natural lighting will be tenants’ new preferences in future.”

JLL predicted that since most new buildings that would enter the market in 2020 are already in the fitting-out stage or nearly completed, there would be no adjustment to its last forecast before the pandemic.

“As the global economy remains uncertain, especially now with the impact of Covid-19, tenants’ new set-up and expansion plans could possibly be affected in the near-term.

“The landlords of large vacant buildings, many of which are newly completed, may need to consider their rents and leasing strategies to attract tenants.” — VNS

Potential of eco property during COVID-19  ​

Potential of eco property during COVID-19 ​

Ecological real estate is considered a safe investment channel amid the pandemic, meeting the demand for green living space and ensuring health safety for dwellers.

COVID-19 threatens property brokers with unemployment

COVID-19 threatens property brokers with unemployment

The COVID-19 pandemic has become a new challenge for property brokers who have been facing many since last year due to the low supply in the market.


Central bank not tighten real estate credit: Deputy Governor

The State Bank of Vietnam (SBV) has never issued any documents or statements ordering credit for real estate be tightened, Deputy Governor Dao Minh Tu said on February 8.

Vietnamese Prime Minister starts official visit to Singapore

Prime Minister Pham Minh Chinh, his spouse, and a high-ranking Vietnamese delegation arrived in Changi Airport on February 8 afternoon, starting a three-day official visit to Singapore.

Businesses discuss ways to overcome challenges in 2023

Warned that uncertainties will still exist in 2023, businesses need to prepare well to weather the storm.

Vietnam's bond market remains quiet this year

The scale of debt in the corporate bond market is less than 15 per cent of GDP.

Organ trafficking in Vietnam driven by high demand, low rate of donation: experts

A conference on organ donation registration and the prevention of human organ and tissue trafficking was held on Monday.

VCCI proposes allowing businesses to set fuel retail prices

The Vietnam Chamber of Commerce and Industry (VCCI) has written to the Government suggesting fuel retail prices be decided by businesses based on supply and demand to prevent fuel shortages.


Vietnam puts children at centre of development policies, strategies: Ambassador

Gov’t issues action plan to realize Hanoi’s development vision until 2045

The Government has issued an action plan to realize Politburo’s resolution on the objectives for Hanoi’s development until 2030, with a vision to 2045.

Commercial sidewalk use may be charged by HCMC authorities

HCMC is planning to allow the paid use of sidewalks for commercial purposes such as vending goods or parking if these business activities leave a space of at least 1.5 meters wide for pedestrians.

CAAV advises caution when buying air tickets

The Civil Aviation Authority of Viet Nam (CAAV) has received feedback on the fact that passengers have to buy air tickets higher than the specified prices on domestic routes, especially during the peak of the Lunar New Year (Tet).

Prime Minister leaves Hanoi for official visits to Singapore, Brunei

Prime Minister Pham Minh Chinh, his spouse and a high-ranking delegation of Vietnam left Hanoi at noon on February 8 for official visits to Singapore and Brunei from February 8-11.

US war veteran wishing to return wartime diary to Vietnamese family

Pater Mathews, a US war veteran, has emailed relevant agencies of Ha Tinh province, central Vietnam, expressing his desire to fly to Vietnam and return a Vietnamese martyr’s diary he came across decades ago to the martyr’s family.


January payment transactions via national public service portal valued at 11.8 mln USD

Vietnam needs new products, services to reach tourism targets

To realise the targets of attracting 110 million tourists and earning some 650 trillion VND (27.5 billion USD) in revenue this year, Vietnam is recommended to develop more products and services to offer new experiences to visitors.

PM Chinh’s Singapore visit expected to advance bilateral trade ties

Prime Minister Pham Minh Chinh’s Singapore visit from February 8-10 aims to affirm the determination to elevate the bilateral economic ties to a new height in the context of many free trade agreement (FTAs) coming into force.