Retail premises in HCM City have been left idle

A house with the floor area of 160 sq m in Binh Thanh district is offered for lease with the rent of VND180 million a month. The landlord said the rent is negotiable if tenants sign long-term contracts. 

According to P, the manager of the premises, the house was leased at VND195 million a month in the past. The lessee opened a Korean-styled café, but left later because of poor custom. 

“If clients lease the premises for a long time, they will be able to enjoy discounts in the first six months and have to pay VND170 million a month only. The conditions are really attractive, but we still have not found tenants,” P said.

Many signs with ads on leasing retail premises have been hung over houses in the central area of HCM City, including Tran Hung Dao, Ly Tu Trong, Nguyen Thai Hoc and Nguyen Trai streets.

The premises at No 64-66 on Tran Hung Dao street in district 1, where there was a shop selling Japanese products in the past, have been left idle for a year. The landlord now accepts to lease the premises at VND125 million a month and VND120 million a month if tenants sign 2-year contracts.

Nguyen Trai, a bustling ‘fashion’ street, also displays abundance of ads for premises leasing. D, one of the landlords, admitted that no tenant has been found since he hang the ad banner six months ago. He receives calls sometimes from people who have interest in the premises, but they don’t contact him again after hearing about the rent. 

Though having lowered rents, some premises in areas near the central districts have also been unoccupied for years. On Nguyen Tat Thanh street in district 4, up to 10 retail premises are closed on a short street section of 300 meters.

Most of the premises have frontage width of four meters and rents between VND130 million and VND250 million a month. Brokers said the rents are 20 percent lower than that of the last year. Meanwhile, the landlords accept rent exemption for the first one or two months, when tenants make interior decoration, which is an unprecedented policy.

The report of a market analysis firm showed that the supply of retail premises for lease in HCM City has slightly decreased with the total floor area of 1.5 million sq m, because some real estate projects for lease as retail premises have shifted to offices.

Tuan Nguyen