HCMC office landlords give discounts to retain customers

By Vu Le   July 10, 2023 | 12:46 am PT
HCMC office landlords give discounts to retain customers
Buildings in District 1, Ho Chi Minh City. Photo by VnExpress/Quynh Tran
Landlords in Ho Chi Minh City office buildings are offering discounts of up to 20% to pump up demand amid a dampened property market.

Affordable offices in Phu Nhuan and Tan Binh Districts, which charge $15-20 per square meter per month, are now giving tenants discounts of 10-20%.

Landlords of at least 10 buildings in these areas are offering free rent on every third square meter. They are also prolonging payment deadlines and offering free property management.

Many of these buildings have been recording a no-occupancy rate of 15-20% in the last three months.

In the mid-range and high-end segments, prices have dropped marginally.

The high-end segment recorded an average price of $45.4 per square meter per month in the second quarter, down 1.1% year-on-year, according to market research company CBRE.

The mid-range segment saw prices falling 0.8% year-on-year to $25.6 per square meter.

CBRE also saw a large portion of offices being moved around last quarter.

Nearly 60% of total office space under CBRE management saw a change in tenants, indicating businesses were looking for more competitive prices amid economic challenges.

Property consultant Cushman & Wakefield Vietnam observed that 90% of offices in the first six months were returned by tenants from many sectors including property, tech and banking.

Trang Bui, country head of Cushman & Wakefield Vietnam, said that businesses were facing financial difficulties and they had paid a lot of attention to cutting expenses, which is why they are moving to more affordable areas.

Nguyen Huu Thien, CEO of office renter Sabay Home, said that the company was offering discounts on 12 office buildings in HCMC.

The decline in office rents began at the end of last year and will likely persist until the end of this year, he added.

"There have been many forecasts of prolonged economic difficulties, therefore landlords will offer more discounts in the upcoming months," he said.

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