New office space to hit market

With a large chunk of supply set to hit the HCM City property market soon, real estate developers and consultants are forecasting the vacancy rates in the office-for-lease segment to increase next year and rents to fall.
Adam Bury, senior manage of CB Richard Ellis, said rents fell across all grades of office buildings in the third quarter.

Grade A space saw a 0.2 per cent decline to US$34.13 per square metre per month, Grade B rates fell 1.9 per cent to $18.36, while Grade C was down 2 per cent to $15.33.

Grade A represents more than 304,000sq.m out of the total space of 1.844 million square meters, with Grades B and C accounting for roughly a half each of the rest.

For the nine Grade A buildings in the city, the average vacancy rate is almost 31 per cent. It is 18 per cent for Grade B and 10.2 per cent for Grade C.

“With such a large quantity of vacant space available, Grade A rents could continue to slide,” Bury said.

Truong An Duong, head of research at Savills Vietnam in HCM City, said around 217,000sq.m of space would be added to the market in 2012, mainly in the central business district and Tan Binh, Binh Thanh and Phu Nhuan.

“The entrance of large new supply and vacancy of 230,000sq.m. will [cause] rents to continue declining,” he said.
Vietnam News

Tags: Vietnam Property market, Vietnam property sector, vietnam real estate market

Posted by VBN on Oct 10 2011. Filed under Real Estate. You can follow any responses to this entry through the RSS 2.0. You can leave a response or trackback to this entry