Hanoi Office Rents
To be the Highest in Asia

Following Business-in-asia.com's earlier report on Cost of Living for Expatriates in Vietnam that Vietnam has been in the midst of a supply shortage for property projects and office rents in Ho Chi Minh City are now more expensive than those in Bangkok, Jakarta and Manila and are rising by the day.

The most current report from Vietnam News stated that Class A office rents in Ha Noi are averaging US$30-40 per sq.m, per month, with a high of $55, according to Marc Townsend, company general director of CB Richard Ellis, Viet Nam.  At these rates, office rents rank now are some of the highest in Asia, said Mr. Townsend.  Mr. Townsend explained that the demand for office space is still increasing as more international companies enter the market and local firms look to upgrade their offices, and this has pushed up rental rates.

As of the third quarter of 2007, occupancy rates in Grade A and B office properties reached 100 %. The newest Grade A buildings, Pacific Place and Opera Business Centre, were fully occupied, while the only new supply to be put on the market was the 6,000 sqm of Grade B office space in The Manor.

Mr. Townsend said "that the supply was expected to remain limited in the near future and there would be some 39,000 sq.m of new Grade B office space in the fourth quarter and during 2008, with projects including Kinh Do Building, Viet Towers and Sun City coming into the market". However, no new Grade A buildings are scheduled for completion until 2009.  In the residential market, no new serviced apartment projects were started during the third quarter and vacancy rates remained extremely low — near 5 %.

The hotel market has also seen a similar situation

Occupancy rates remain high, at over 74 % for five-star hotels and nearly 80 % for four-star ones, while room rates are averaging $124 per night.  It is estimated that by 2010, the four and five-star hotel market is expected to grow by 3,700 rooms, but will mainly serve international tourists and business travelers.

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