1. Retail: Good mid-end growth

Retail stock was 1,050,000 m2, stable quarter-on-quarter (QoQ) due to new supply of 30,500 m2 and equivalent withdrawal from closures, but up 13% year-on-year (YoY).

The average gross rent decreased by -1% QoQ and -10% YoY. Developers were pressured to decrease rent to avoid tenant shifts and secure occupancy in a competitive market.

The average occupancy was 93%, stable QoQ. Department store occupancy increased 2 ppts QoQ while shopping centre decreased by -1 ppt and retail podium was unchanged. Soft demand for luxury was observed over various promotions in high-end retail projects. F&B continued its rapid expansion as consumer demand shifts towards daily consumption needs with greater awareness of hygiene.

 2. Office: Supply limits helps performance

In Q2/2016, total stock was 1,580,000 m2, mostly unchanged QoQ in spite of the withdrawal of 6,100 m2 from the closure of three Grade C projects. Supply side remained unresponsive in Q2/2016 despite strong demand.

Property owners enjoyed continued strong performance. Average occupancy steadily rose, up 1 ppt QoQ and 4 ppts YoY reaching 97 percent. Average rent slightly increased at a sturdy pace of 1% QoQ and 5% YoY.

Grade A and B projects in district 1 contributed to most of the new take-up this quarter, accounting for 56% of all new leased office space. Grade B was the best performer of all three segments with both average rent and occupancy, consistently trending upward since Q1/2015.

For more information, click Savills report on HCMC Real Estate Market Q2-2016 – EN and Savills báo cáo thị trường bất động sản HCM Q2-2016 – VN.


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