Trang Tien Plaza in Hanoi.

Prominent growth was seen in regions including Quang Ninh, Hai Phong, Can Tho, Danang, HCM City and Hanoi.

Trần Phạm Phương Quyên, Senior Leasing Manager at Savills Vietnam, said that retail growth is being driven by demographic factors and widespread urbanisation, which in turn stimulate economic expansion.

A study by KPMG Vietnam forecasts that from 2020 to 2030, Vietnam will gain about 23.2 million new middle-class individuals, with a compound annual growth rate of 5.5 per cent. It places Vietnam among the fastest-growing countries in Southeast Asia.

Also, as of October 2023, the urbanisation rate in Vietnam has reached 42.6 per cent.

The Vietnamese government aims to raise this rate to at least 45 per cent by 2025 and over 50 per cent by 2030.

"The rise of the middle class, the positive recovery of the tourism industry and the continuous arrival of new brands have created a dynamic, modern retail landscape with immense potential," Phương Quyên explained.

She added that shopping malls are becoming increasingly popular as entertainment and leisure destinations.

According to the Prime Benchmark report released by Savills Asia-Pacific, Hanoi was among the most active retail real estate markets in the first seven months of the year.

Emerging markets in Southeast Asia, including HCM City, Hanoi and Jakarta (Indonesia) have seen significant improvements in rental prices for high-end retail space, with increases of 4.7, 4.6 and 3.8 per cent, respectively.

In Hanoi, rents for prime spaces are $96.4 per square metre. By comparison, Kuala Lumpur's rate is $158.6 per square metre, Singapore's is $399.7 per square metre and Beijing's stands at $289.5 per square metre.

Đỗ Thị Thu Hằng, Senior Director of Advisory and Research at Savills Hanoi, emphasised that prime retail rents in Hanoi remain competitive relative to other regional markets.

"Briefly, rents in this segment in Hanoi are expected to stabilise or increase due to limited new supply. It means that existing projects in prime locations will maintain high occupancy rates and could see rental price increases," Thu Hằng said.