Retail: Increased Competition and Decreased Rents

In Q3/2016, the total retail stock was approximately 1.2 million m², up 3% quarter-on-quarter (QoQ) and 23% year-on-year (YoY) due to the entry of two new retail podiums with approximately 32,800 m².

The average ground floor rent decreased across all retail segments. Average occupancy increased 1.9 ppts QoQ but decreased -2.7 ppts YoY. While department store occupancy decreased -1.3 ppts QoQ, both shopping centre (2.6 ppts) and retail podium (2.1 ppts) occupancy increased.

Strong competition between domestic and foreign retailers forced some projects to renovate and restructure floor plans.

Office: Reasonable Performance

Ha Noi office stock remained stable QoQ but increased 9% YoY. In Q4/2016, one project will enter the market supplying approximately 11,300 m².

The average rent decreased slightly -0.5% QoQ due to downward adjustments to both Grade A and C but increased 3.0% YoY.

Average occupancy showed improvements of 2.2 ppts QoQ and 2.8 ppts YoY, much due to Grade B increases of 2.9 ppts QoQ and Grade A increases of 2.3 ppts QoQ.

The total take-up was approximately 23,000 m². Grade B led with approximately 18,000 m², followed by Grade A with 8,400 m² and Grade C with 4,300 m².

For more information, click 12102016 – Savills Vietnam report on Hanoi real estate market Q32016- EN and 12102016 – Savills Việt Nam báo cáo tình hình thị trường BĐS Ha Noi Q32016- VN.