The Commercial Real Estate Market in Vietnam 2021-2026 – Rising Demand for Quality Office and Retail Stock in Centralized Places, with the Hanoi CBD in Focus –

DUBLIN – (BUSINESS WIRE) – The report “Commercial Real Estate Market in Vietnam – Growth, Trends, Impact of COVID-19 and Forecasts (2021-2026)” has been added to offer.

The Vietnam commercial real estate market is expected to have a CAGR of 14.89% over the forecast period 2021-2026.

Despite signs of cyclical slowdown, the outlook for Vietnam remains positive. Vietnam’s economy is growing rapidly, with laws encouraging foreigners to invest in its development. As a result, there has been a wave of high-end real estate developments in the country.

Improving the infrastructure to support the tourism industry, which has always been one of Vietnam’s priority investment areas, has catapulted the rise of many tourist cities in recent years. Local demand in Vietnam is also increasing as Vietnamese entrepreneurs look for investments to put their money into.

The long-term outlook for the commercial real estate sector is positive due to the continued good economic conditions in the country, supported by rising consumer spending and a strong tourism industry.

In commercial real estate, Vietnam’s hospitality sector is growing rapidly. By the end of the third quarter of 2019, an estimated 442 four- and five-star hotels were operating in Vietnam, providing 91,236 keys to the market.

In the office segment, the banking / insurance, industry and IT sectors are likely to drive demand, with co-working spaces growing particularly strongly.

In the retail segment, many new retail brands are starting or planning to establish stores in Vietnam to introduce new concepts in the local market that want to attract visitors and develop in the commercial space.

Major market trends

Growth trend in Vietnamese e-commerce and industrial real estate

The commercial real estate market in Vietnam is growing at a CAGR rate of 14.89%. Continuing the momentum of 2018, Vietnam welcomed nearly 13 million foreign visitors in the first nine months of 2019, up 10.8% year over year. In addition to the hospitality and hotel industries, Vietnam is now one of the fastest growing e-commerce markets in Southeast Asia. Amid the COVID pandemic, more and more consumers are choosing to shop online, which has increased the demand for cold stores for food and other essentials.

E-commerce requires three times as much storage space as traditional logistics activities. According to JLL, both domestic and overseas investors have turned their attention to health logistics as they will need more cold stores to meet the growing demand for temperature-sensitive products such as food, medicines and COVID-19 vaccines. In the retail sector, Ho Chi Minh City is expected to have over 200,000 m² of new retail space in both CBD and non-CBD areas by 2023, according to CBRE Vietnam. Categories such as F&B, Health & Beauty will be further expanded on the sales podiums.

Vietnam’s commercial real estate market has performed well and is expected to grow. While Samsung Electronics has a huge factory with an area of ​​67,088 m². in Ho Chi Minh City, Apple Inc. plans further expansion in the country. With Vietnam set to become the new manufacturing hub in Asia, the industrial real estate market has outperformed other commercial real estate sectors. In the first three quarters of 2020, almost 47% of all foreign direct investment (FDI) was in manufacturing.

Workplace real estate continues to grow in Vietnam

In 2020, an experiment on working from home took place around the world that showed that companies can continue to work effectively through the use of technology. But for many, the lack of face-to-face interaction has put teams under pressure, and while some of our clients expect to adopt flexible work practices in the future, for most, this will be the office too, which will remain the focal point for doing business. Coworking spaces are a segment of office real estate that is growing in Vietnam.

In the challenging phase of the first half of 2021, Toong, one of the first and largest coworking space chains in Vietnam, put new projects into operation. In March 2021, the first Toong station was officially put into operation in a strategic cooperation project with Wink Hotels in 75 Nguyen Binh Khiem, District 1 Class A and B. In 2020 and 2021, the number of co-working and serviced offices in Vietnam is expected to break through this number.

Competitive landscape

Commercial Real Estate in Vietnam has a medium market share concentration. International investors are also drawn to the Vietnamese market and want to invest in almost all segments from office to retail to high-end hotels. Developers are active in developing new hospitality products for sale, the most famous of which are Shophouse / Shop Villa in Phu Quoc and Ha Long.

In the hospitality real estate space, developers in Vietnam need to diversify their market by paying attention to the non-traditional market and employing professionals to manage their properties. Demand for high quality office and retail properties in centralized locations is increasing, with Hanoi CBD as a focus. The strength of the manufacturing and tourism sectors will keep the demand for retail, office and industrial units high.

Distinguished companies

  • Wine group

  • Dat Xanh group

  • FLC group

  • Toong

  • Nam Long investment company

  • Group of suns

  • Colliers International Vietnam

  • Savills Vietnam

  • CBRE Vietnam

  • JLL Vietnam

  • Vietnam house

  • Full house Vietnam

  • Luxstay

  • My tour

  • Vntrip

  • Ivivu and

  • Vietnam booking

  • Vincom JSC

  • Bitexco

  • Lilamaland

  • Phat Dat real estate

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