Tenants there may have to pay billions of VND annually for a rental space in the building, but the rent is not the highest in the area.

The Hanoi People's Committee has recently agreed with the proposal to demolish the shopping center at No1-3-5-7 Dinh Tien Hoang, commonly known as the "Shark Jaw," to build an underground space.

Built in 1991-1993, the "Shark Jaw" building covers an area of about 310 square meters and has six floors. Floors 2-5 are reserved for restaurants and cafes, while the sixth floor offers panoramic views of Hoan Kiem Lake.

This building currently offers premises to many well known brands, including Aldo, Highlands Coffee, Vua Cha Ca, and Laika Cafe.

Well located opposite Dong Kinh Nghia Thuc Square and facing Hoan Kiem Lake, the rental rates at the "Shark Jaw" building are among the highest in Hoan Kiem District.

According to Hanoi's new land price list (effective from December 20, 2024 to December 31, 2025), which serves as a basis for calculating annual land rent, the highest commercial land price belongs to Hoan Kiem District at nearly 244.3 million VND per sq m.

This price corresponds to the first position, which includes streets Dinh Tien Hoang, Hai Ba Trung (from Le Thanh Tong to Quan Su), Hang Dao, Hang Khay, Le  ThaiTo, Ly Thuong Kiet, and Nha Tho, assessed based on profitability potential, infrastructure conditions, and proximity to streets.

Previously, Dinh Tien Hoang had the highest commercial land price, nearly VND90.5 per sq m. The new land price list has nearly tripled the previous rate.

Meanwhile, the surveys on real estate buying and renting sites showed that in 2023, the asking rental price at the "Shark Jaw" was about VND3.1 million per sq m. Thus, renting a 75 sq m space would cost around VND230 million a month, or nearly VND2.8 billion a year.

In August 2023, a store with an 11-meter frontage and 75 sq m area on the first floor of the "Shark Jaw" building was advertised for rent at VND255 million per month, equivalent to VND3.06 billion a year.

Some brokers specializing in inner-city areas reported that rental rates at the "Shark Jaw" building are at least $100 per sq m.

According to a real estate service company, first-floor rental prices range from $60 to $200/m²/month (approximately VND1.5-5 million, excluding taxes and fees), equivalent to VND180-500 million a month for a 100 sq m floor area. The asking rent and contract price vary depending on negotiations between tenants and the building owner.

Due to high rental prices, many businesses have come and gone, but brands like Aldo and Highlands Coffee have remained steadfast.

Higher rates 

Despite the advantageous position, the rental rates at the "Shark Jaw" are not the highest in Hanoi.

In 2023, market research firm Cushman & Wakefield reported that Trang Tien Street had the highest rental prices in the capital city, averaging around $300 USD/m²/month.

Nationally, the highest rental rates belong to Dong Khoi Street in HCM City. In 2023, rental prices there averaged about $350/m²/month.  

Amid a wave of businesses returning rented spaces in HCMC and Hanoi, Hoang Minh Nguyet, Senior Director of Savills Hanoi's Commercial Leasing Department, stated that there are two main types of premises.

For prime locations for luxury brands, supply is always scarce, and tenants are willing to pay high prices for space. However, the situation is different for regular commercial spaces. Many previously considered "golden" locations now fail to attract tenants due to high rental costs, and strict payment terms.

According to Nguyet, major brands still need physical stores to enhance brand recognition, attract customers, and combine in-store and online shopping. In the current market, brands must carefully consider their location and remain flexible in their business strategies.

The Hanoi authorities have decided to demolish ‘Shark Jaw’, a decision applauded by architects and people.

"Hoan Kiem Lake has a small area, so it does not need to have overly grandiose architecture buildings because they will contrast with the general panorama of the entire area," said architect Hoang Thuc Hao.

Hao expressed support for Hanoi to research and invest in building other public spaces around Hoan Kiem Lake and the Dong Kinh – Nghia Thuc Square area.

It is necessary to think carefully about whether to consider demolition or renovation, he said.

Architect Pham Thanh Tung, an independent critic, said that removing Shark Jaw is a correct policy but has been a bit slow. The idea of removing the building was first put forward 10 years ago.

Tung agreed that the demolition of the "Shark Jaw" building will create an open, friendly, and intimate space.

Hong Khanh