The office leasing market in Hanoi has seen a strong rebound, especially in the Grade A segment where the occupancy rate in the first quarter shot up to 71%, an increase of 8 percentage points on the previous quarter, according to the property market research firm Savills.
The Savills Market Report states that in the first quarter this year, the rental of Grade-A office remains unchanged, at around VND680,000 per square meter a month, exclusive of service charge and value added tax.
The high occupancy rate is attributed to numerous incentives by Grade-A office building developers in order to not only keep hold of their valued current tenants, but also attract more new tenants from buildings of grades B and C.
Hanoi City’s central business district (CBD) has been considered the traditional destination for grade A office building development and operation with consistently high occupancy level of up to 90-100%, such as Sentinel Place, BIDV Tower, Asia Tower, Sun City, and Opera Business Center to name a few.
The tenants occupying these buildings are mostly non-production companies and organizations that want have a strong presence in the core center of the city to enjoy convenience in operation and daily business activities.
The main reason for the healthy occupancy in the Grade A segment is the limited supply, with only 16 buildings in total, including 13 in the CBD. Besides, the strict construction rules from the Ministry of Construction applied to all buildings in the CBD also limit the building height and land area; as a result, it consequently limits the supply source of the Grade A buildings.
Rol.vn - Source: Saigon Times