>> Office rents way down in HCM City
Ho Chi Minh City office rents have continued falling so far this year, particularly Grade A offices.
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| No good signs for Ho Chi Minh City’s offices for lease |
By mid-March, office rents at some high-rise buildings in the city had dropped by 2-5%, depending on their grade, with Grade A witnessing the largest slip. Up to 40% of Grade A offices remain vacant.
Many market research firms forecast that 2-5% decreases will be seen from now to the end of this year in Ho Chi Minh City’s office-for-rent market, because, during this period, no more Grade A office projects will come into operation.
However, without a sudden increase in demand, the market will witness even larger drops in the next three years when many Grade A office projects are put into use.
Lower rents are also seen at Grade B and C offices due to the market entry of many offices upgraded from old buildings. In the first two months of this year, a number of Grade B and C offices in semi-urban areas of Tan Binh and Tan Phu were offered at rents of just USD10-12 per square metre per month.
According to CBRE Vietnam, Ho Chi Minh City office rents will follow the same downtrend as other big cities in Asia, such as Shanghai and Beijing, where prices range between USD31 and USD33 per square metre per month.
The city’s office rents have decreased by half over the past three years. Grade A office rental per square metre is now just USD35 per month, compared to the record high of USD70 in the first quarter of 2008.
By mid-October 2010, Ho Chi Minh City had more than 150 office buildings of all grades, providing around one million square metres of office space. Some 50% of the market is Grade B office space.
