THE RENTAL PRICE OF RETAIL SPACE IN THE CENTER OF HO CHI MINH CITY IS INCREASINGLY EXPENSIVE.

The rental prices for high-end commercial spaces in the central area of Ho Chi Minh City have continued to increase by 18% in the first six months of the year compared to the same period last year, reaching $280 per square meter per month, according to CBRE.

A report from real estate consulting firm CBRE Vietnam states that the average rental price for ground floor and first floor spaces in high-end commercial centers in Ho Chi Minh City (mainly in District 1) has reached a record level of $280 (equivalent to 7 million Vietnamese dong) per square meter per month in the first half of the year. This figure represents an increase of over 18% compared to 2023, and a 60-70% increase compared to five years ago.

According to data from real estate services company Savills, in the first six months of the year, the average rental price for high-end retail spaces in the central area of Ho Chi Minh City (including District 1, Thu Thiem, and District 7) was $151 (equivalent to 3.7 million Vietnamese dong) per square meter per month, an increase of 4.7% compared to the same period last year. The supply has remained stable at 1.5 million square meters since Q1/2022.

Người dân mua sắm ngày Blackfriday tại Vincom Đồng Khởi tối 25/11. Ảnh: Thanh Tùng

(People shop on Black Friday at Vincom Dong Khoi on the evening of November 25.)

The recent increase in rent prices in Ho Chi Minh City’s retail market can be attributed to the limited supply of new commercial spaces and high demand from international brands.

According to Ms. Duong Thuy Dung, Executive Director of CBRE Vietnam, the retail real estate market, especially in the city center of Ho Chi Minh City, is benefiting from the limited supply. In the past six months, the city has only added 56,000 square meters of commercial space from two new projects, Vincom Megamall Grand Park (District 9) and Vincom 3/2 (District 10), both located outside the city center.

The city center currently accounts for only 12% of the total floor area, with an occupancy rate consistently above 95%. The demand for rental spaces from international brands in this area is high, leading to increased competition. As a result, rental prices are also rising.

Ms. Trang Bui, General Director of Cushman & Wakefield, stated that from 2013 to 2019, the city welcomed 130,000 square meters of new retail space each year. However, from the onset of the Covid-19 pandemic until the end of 2022, the market will only see an additional 100,000 square meters of retail space.

In the past three years, there have been no new projects in the city center, and the existing commercial centers have very few vacant spaces available for lease. Meanwhile, many new international brands such as Columbia, Arabica, Ain & Tulpe, and 6ixty8ight have expressed their intention to open stores in Vietnam, with Ho Chi Minh City being a key market of interest.

Furthermore, the F&B (food and beverage) and Lifestyle sectors continue to expand, with many Chinese retailers such as Dahu Hotpot, Xuxiaoying, and Long Wang increasing their demand for rental spaces. This situation has contributed to a continuous increase in rental prices over the years.

CBRE has stated that from now until the end of the year, Ho Chi Minh City will have two projects on Ta Quang Buu Street (District 8) with a total area of 100,000 square meters, but there will still be no new projects in the city center for the next three years. Therefore, for premium spaces located in the city center, rental prices are expected to continue to increase by 17-18%. From now until 2026, rental prices are projected to maintain an upward trend of 7-10% annually.

According to Oxford Economics, consumer spending in Ho Chi Minh City is forecasted to increase by 8.4% in 2025. Modern retail in this market of over 13 million people is also expected to capture 50% of the retail market share in the next two years. The strong recovery of the domestic economy has driven the development of the retail sector, attracting new brands to enter and expand. This trend further pushes up retail rental prices.

According to the VNEXPRESS.