The Hanoitimes - Despite of the frozen property market this year, office builders’ sales of renting luxury retail space in Hanoi remain positive, with occupation rates always at 100 percent.
The entire retail space in downtown Hanoi has been rented with an unchanged price of US$54 per square meters, according to a second quarter report of the commercial property and real estate services adviser CB Richard Ellis Vietnam.
The real estate services provider Colliers International Vietnam said in a report that retail sales in the last 11 months increased 20 percent year-on-year, showing consumption at shopping centers and modern supermarkets getting stronger.
Despite of their high rentals, big buildings in downtown including Vincom, Trang Tien Plaza and Big C announced they were occupied completely in early October.
Vincom asks for a rental of around $135 per square meters, while rentals of Trang Tien Plaza and Big C are $80 and $30-50 respectively.
The boom of retail space segment has encouraged property companies to focus on building luxury shopping centers.
Statistics showed many large shopping buildings will likely to open in Hanoi at the end of this year, including Hanoi Grand Plaza with an area of 16,000 square meters, Hang Da market 7,000 square meters.
Others including Mo market, Pico Mall, Ciputra Mall an Usilk City are expected to open in early 2012. Experts expected retail spaces with the total area of nearly 380,000 square meters will be rented in the capital city at the end of 2011.
Some analysts, meanwhile, showed cautious with the strong growth of retail space segment. An abundant supply will prompt to a harsh competition between office builders, leaving retail spaces opening late struggling to find customers, they warned.
Real estate brokers said retail spaces in Hanoi’s outskirt areas hardly found customers. CBRE Vietnam said in a report that retail space area in the outlying districts rose nearly 50 percent this year and expected an increase of 10 times higher in 2013.
Builders are also anxious on the fact that investors were lowering retail spaces’ prices and rental fees, brokers said.
“Earlier investors could easily earn a profit of $1,000-2,000 per square meters from selling retail space. Now they struggle to find buyers due to too-high rentals of retail spaces in downtown and low demand for ones in outskirt areas,” said a veteran broker in Hanoi.