Latest report for Q2 from Savills Vietnam shows office space performing strongly in southern city.
By 2017 the office segment in Ho Chi Minh City will welcome approximately 504,000 square meters of new supply, an increase of 36 per cent compared with 2014, Savills Vietnam wrote in its latest report on the Ho Chi Minh City Real Estate Market.
In the second quarter one new Grade C project, in District 3, entered the market, providing 3,200 square meters. There are now approximately 1.472 million square meters in 224 projects. Total stock was relatively stable quarter-on-quarter and increased 3 per cent year-on-year.
The second quarter also saw increasing occupancy in the office segment, by an impressive 93 per cent - the highest level in seven years. Average rent was VND541,000 ($25) per square meter, which was stable both quarter-on-quarter and year-on-year.
The report said that demand for Grade C office space was higher than for other grades, accounting for more than 68 per cent of total take-up in the second quarter.
Factors influencing demand, such as economic growth, foreign direct investment, and newly-registered enterprises, have increased year-on-year and provide positive prospects for office space demand.
Given the market performance Savills was extremely positive about the prospects for office segment this year and over the next few years.
This year one new Grade A project, three new Grade B projects and five new Grade C projects are expected to enter the market, supplying approximately 178,000 square meters.