About 75% of future property projects in retail and office segments would be located in Hanoi's west and central areas, according to a report on Hanoi’s property market released by Cushman & Wakefield.

Some notable projects are Hinode City in Hai Ba Trung District (20,762 sqm), Lancaster Luminaire in Dong Da District (5,631 sqm), The Zei in Nam Tu Liem District (9,000 sqm), Lotte Mall Hanoi in Tay Ho District (72,000 sqm), AEON Mall Giap Bat Hoang Mai District (84,000 sqm) and BRG Park Residence Thanh Xuan District (13,945 sqm).

The retail market in Hanoi has recovered and returned to the growth trajectory of the pre-pandemic period. The occupancy rate of the whole market reached 89%, with the total accumulated supply of shopping malls, department stores, and commercial podiums reaching 1,25 million sqm. 

The average rental price was $39 per square meter per month, up 1,09% compared to the previous quarter and the same period last year.

Office

The report highlighted the west and central areas will be the locations of a series of new office projects in the next three years.

These are Techcombank Tower (36,300 sqm), Lancaster Luminaire (21,500 sqm), BRG Diamond Park Plaza (33,800 sqm), Lotte Mall Hanoi (41,000 sqm), and Landmark 55 (60,000 sqm).

The market recorded a new supply in the third quarter (Q3) of 22,350 sqm from the Epic Tower project (19 Duy Tan, Nam Tu Liem), bringing the total supply of Grade A and B in Hanoi to a total of 1,65 million sqm of office space. 

Office rents in the whole market increased slightly at $34 per square meter per month for Grade A, and $20 per square meter per month for Grade B. 

The market witnessed a positive absorption volume of 40,000 sqm in the first nine months of 2022, coming from companies in the fields of insurance (25%), manufacturing (25%), technology (20%), services (10%), and logistics (5%), mainly concentrated in the buildings on the edge of the center and the West area.

Industrial and logistics segment

According to the consulting firm’s estimation, future supply for the industrial and logistics segment will be an additional 17,000ha with the northern region’s emerging manufacturing centers in Hai Duong, Hung Yen, Bac Giang, and Bac Ninh provinces.

With strong foreign direct investment inflows and mature infrastructure, the northern provinces, including Hanoi, Bac Ninh, Hai Phong, Vinh Phuc, Hung Yen, Hai Duong, and Quang Ninh, have always been the focal point for industrial investors. 

The total accumulated industrial land supply in the whole market reached 13,600 ha, with a new project recorded as an expanded Phuc Dien Industrial Park (172 ha). 

Land rent in Q3 has increased by 2% compared to the previous quarter, reaching $111 per square meter per lease term, and the occupancy rate reached over 80%. 

The ready-built factory market saw no significant change in new supply at more than 2.5 million sqm, with the absorption rate down 6% YoY at 86%. In contrast, ready-built warehouse supply increased by 9.3% QoQ to more than 1.8 million sqm, of which warehouse absorption rate increased by 2% QoQ and decreased by 15% YoY, at 78%. 

The average asking price for the factory is $4.6 per square meter per month, and the warehouse is $4.5 per square meter per month, respectively.

Apartment

According to Cushman & Wakefield’s estimation, there will be about 103,000 new apartments for sale from the last quarter of 2022 to 2025.

The supply of apartments in the inner-city districts is getting limited as the project approval process is increasingly complex. As a result, the supply of new apartments in Q3 reached just over 3,000 units, down 38% QoQ and 15% YoY, with supply mainly from Nam Tu Liem, Hoang Mai, and Gia Lam districts. Mid-end apartments account for 84% of the total supply this quarter, other segments are affordable 12%, and high-end 3%. 

There is no supply for the luxury and super luxury segments. Some projects include Hanoi Melody Residence, Khai Son City, Grand Sunlake, and MHD Trung Van.

Credit control also made it difficult to disburse loans to customers, leading to sales and absorption rates decreasing in the quarter, with 4,600 units sold, down 15% QoQ. To adapt to the current situation, developers have offered easier payment terms with significant discounts or attractive promotions to customers to increase market demand.

The average primary selling price reached about $1.858 per square meter, down 3.1% from the previous quarter. 

Townhouses

Cushman & Wakefield estimates the city's total supply of townhouses in the future will reach 12,000 units. Notable projects in the implementation process from Q4 include Sunshine Heritage Resort, Hana Garden Homes, and Will State.

The new supply of townhouses in Hanoi dropped significantly in Q3, only 625 units were launched, halving in comparison to Q2 but still up 4.6% YoY. The total number of units sold is about 374 units. 

Leading Hanoi's new supply are Me Linh, with 50%, and Gia Lam, with 26%, with notable projects such as HUD Me Linh Central and Highway5 Residence.

The average primary price was recorded at $6,800 per square meter of land, down 0.2% QoQ and up 43.3% YoY. Investors are becoming more cautious in investing and buying real estate due to a lack of liquidity and loans.

Source: Hanoi Times