VietNamNet Bridge – The supply of retail space is increasing in Hanoi and HCMC and could reach 1.5 million square meters in both cities late this year, according to a study of CBRE Vietnam.

A model of SC Vivo City in HCMC’s District 7

Regarding the number of projects and retail space being planned, Hanoi and HCMC can compare well with regional countries. Hanoi will have around 900,000 square meters of retail space at commercial centers while the area in HCMC will be 600,000 square meters by the end of the year.

HCMC is expected to have at least five new projects this year, and two of them are Mega Mall of Vingroup and SC Vivo City of Vietsin Commercial Complex Development Joint Stock Company (VCCD).

Early this month, Vingroup announced its plan to develop 25 Vincom commercial centers and Vincom Mega Malls nationwide this year. According to Vingroup, the occupancy rate at 25 commercial centers has reached 70%.

Vingroup has recently opened Vincom Thu Duc in HCMC’s Thu Duc District with nearly 28,000 square meters of floor space and started work on Vincom Haiphong. The project in the northern city of Haiphong will provide the market with over 48,000 square meters of retail space and housing.

Richard Leech, executive director of CBRE Vietnam, said the development of new shopping centers has resulted in new brands emerging in Vietnam. Last year saw many new names on the retail market in HCMC like Robins Department Store, Lalique and Marks & Spencer.

Leech noted Metro Line No. 1 currently under construction will link together several shopping centers in HCMC’s central business district and District 2.

According to CBRE Vietnam, rentals in HCMC are approximately US$100 per square meter in the central business district and US$40 in other parts of the city.

Besides, nearly 50% of the enquiries for retail space are from the food and beverage sector.

As calculated by the Daily based on reports of property market research companies like CBRE Vietnam, Savills Vietnam, Cushman & Wakefield Vietnam and DTZ Research, the occupancy rate at commercial centers is 80-90%.

Retail space is offered at not only big commercial centers but also on the ground floors at most apartment buildings and towers.

At a recent review meeting, Do Thi Loan, vice chairwoman of the HCMC Real Estate Association, expressed concerns that if the development of retail space at buildings does not proceed with viable plans, developers will find it difficult to attract tenants.

SGT