The HCMC office market grew positively in the third quarter

In the third quarter of 2020, the average asking rents for both Grade A and B office space remained on a slight increase. Specifically, prices increased by 4.5% and 11.5%, respectively, compared to Q2. Compared to the same period in 2019, Grade A rents decreased slightly by 0.2%, while Grade B increased sharply by 26.1%. Thereby, proving that the demand for office space has not cooled down, despite the outbreak of the second wave.

According to the report on the HCMC office market in the third quarter of 2020 of Colliers International Vietnam, as a result of the epidemic along with the trend of moving out of the center, Grade B buildings quickly became sought after products. for the majority of SMEs, and even large firms. Up to now, the supply of this segment is nearly 1,150,000 m2, although no new supply will be recorded in the third quarter, but it is expected that in the near future, the supply may increase to 1,250,000 m2.

Some companies have begun to move offices out of the CBD to cut costs, mainly with small, start-up companies. New districts that have received attention include: District 2, 5, 7, Binh Thanh and Tan Binh. The main reason why businesses move like this is because the rental price of Grade A office space is constantly increasing.

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In addition, a number of large tenants have moved from Grade A to Grade B, even looking for buildings with lower rental costs. The finance, banking and technology industries began to act to narrow the leased area because these companies wanted to restructure their offices to reduce costs. In fact, there are still tenants with good financial capacity moving their offices to Grade A buildings, but the transaction volume is much less compared to the same period. Due to no change in supply, the occupancy rate in this quarter remained at a high level.

“If the translation is well controlled, and the new supply in the eastern districts of Ho Chi Minh City is deployed, foreign investors will move to Vietnam. Meanwhile, the demand for office space will increase. In addition, FDI inflows have continuously poured into Vietnam over the past time, which is evidence that many foreign enterprises are moving and entering the Vietnamese market and they are the main customers for Grade A segment. ".

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According to Colliers International Vietnam, the net rental price range of Grade B buildings in Ho Chi Minh City is very wide, stretching from about 230,000 VND - 1.1 million VND / m2 / month as of the third quarter of 2020. Although these offices are mainly concentrated in districts 1 and 4, located in the city center, junctions, intersections or adjacent to many roads, but due to the time of use, most of them are over 10 years. There are buildings up to 20 years so they do not meet the new standards of architecture - construction - management of Grade A office building.

Grade B office has been highly appreciated for its quality, central location, convenient traffic, modern office, professional working space, meeting the standards of architecture - construction - management. There are certain reasons, but the price is "comfortable" than that of Grade A office. Therefore, this is the segment that will be most popular, dominating both the demand and supply of the market in time. next.

(According to natural resources and environment newspaper)

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