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PROPERTY



                                                                               year-on-year. Take-up reached 16,500 sq
                                                                               m, much more than the 1,500 sq m recorded
                                                                               in the fourth quarter of 2021. This can be
                                                                               partly attributed to the city’s post-pandemic
                                                                               economic recovery.
                                                                                  Ms. Hoang Nguyet Minh, Senior Direc-
                                                                               tor of Commercial Leasing at Savills Hanoi,
                                                                               told VET that the office market has been
                                                                               far more resilient than other sectors like
                                                                               hotels or retail. There were many prolonged
                                                                               lease negotiations last year as tenants could
                                                                               not  visit  sites  due  to  social  distancing
                                                                               restrictions. As these were eased and inter-
                                                                               national borders reopened, the market has
                                                                               seen a significant recovery this year. There
                                                                               has  been  an  increase  in  the  number  of
                                                                               international businesses setting up shop,
                                                                               particularly those in logistics and real estate.

                                                                               CHANGING TO ADAPT
                                                                                  Developers have made changes to their
                                                                               office projects to adapt to the “new normal”
                                                                            PHOTO: VIET TUAN  have  adopted  hybrid  working  models,
                                                                               and attract tenants.
                                                                                  According to Savills, many companies

                                                                               where employees can work either remotely
                                                                               or  from  the  office,  depending  on  their
         Return to work                                                        scheduling requirements, which results in
                                                                               office  densities  being  much  lower  than
                                                                               before. Previously, in Grade A and B offices,
                                                                               lessors would need about 7 to 10 sq m per
         The office segment in Vietnam’s real estate market has seen           person, whereas hybrid offices have a den-
         positive signs as the “new normal” takes shape.                       sity of about 5 to 6 sq m per person. Land-
                                                                               lords  are  now  engaging  with  tenants  to
          HOANG TU Reports                                                     review their workplace strategies, which
                                                                               will improve tenant and building opera-
                                                                               tions. Other trends include the introduction
               ietnam’s  office  market  recorded  tenants looking to expand. Staff returning  of prop-tech (property technology) within
               many  positives  in  the  opening  to offices has also driven up demand in  many Grade A offices and the incorporation
         V months of 2022, with Savills not-  the first few months of the year. Mr. Eddie  of green areas into new developments.
         ing that real estate, insurance, banking,  Lim,  CEO  of  Viva  Land,  told  VET  that  For  old  buildings,  refurbishment  is
         and  ICT  tenants  led  the  market  in  the  Vietnam’s office market has bounced back  essential to retain tenants. Many new office
         first quarter. Average occupancy came in  strongly in the opening months of the year  developments are of international standard
         at 86 per cent, with Grades A and B the  after a challenging period. “Even during  and can compete with offices in markets
         leading contributors.              Covid-19, we still received a lot of inquiries,  like Shanghai, Hong Kong (China), Sin-
                                            which  means  occupiers  were  preparing  gapore, and even London. Landlords also
         RECOVERY DURING “NEW NORMAL”       for  their  next  move,”  he  said.  “After  the  need  to  be  more  flexible  in  the  services
           In terms of projects, in the first month  pandemic  was  brought  under  control,  they provide, as supply levels are increasing
         of  2022,  the  Viva  Land  Investment  and  demand for Grade A office space rose.”  and demand is becoming more complex.
         Development JSC announced that through  With overall occupancy at Saigon Centre  Mr. Lim agreed that the pandemic has
         its affiliates it had acquired Capital Place,  well above 90 per cent, Keppel Land’s Grade  changed  how  people  work,  and  many
         an international Grade A office building in  A office project in Ho Chi Minh City has  companies have implemented hybrid work-
         Hanoi, paving the way for it to deepen its  remained in high demand due to its prime  ing  models.  Several  tenants  at  Capital
         footprint in Vietnam’s luxury realty market  location and quality offerings. The tenant  Place  have  adopted  the  model,  such  as
         in the decade to come. Prior to that, Capi-  base has remained largely unchanged.  Microsoft  and  LINE.  The  building  has
         taLand Development (CLD), the develop-  In Hanoi in the first quarter, the total  also introduced a number of measures to
         ment  arm  of  the  CapitaLand  Group,  stock  of  2.17  million  sq  m  net  leasable  meet requirements and bolster the tenant
         announced its divestment from Capital Place  area  (NLA)  from  191  projects  was  up  8  experience,  such  as  offering  the  largest
         for $550 million to an unrelated-third party.   per cent year-on-year according to Savills’  column-free floor plate in Vietnam, assist-
           Thanks to a successful vaccination cam-  quarterly report released in April. Occu-  ing occupiers in developing workspaces,
         paign  and  reopening  of  borders,  which  pancy increased 2 percentage points (ppts)  installing advanced air purification systems
         has enabled expats and business travelers  quarter-on-quarter,  thanks  to  Grade  A  to  ensure  clean  air  supply,  and  imple-
         to enter Vietnam once more, Viva Land  and Grade B improvements.      menting access control technology.
         has  witnessed  a  dramatic  increase  in  In Ho Chi Minh City, office stock was  KLOUD, meanwhile, is Keppel Land’s
         demand  and  site  visits  to  Capital  Place,  approximately  2.5  million  sq  m,  up  0.4  new generation serviced co-office platform
         not only from new tenants but also existing  per cent quarter-on-quarter and 3 per cent  that  leverages  technology  and  caters  to


         42 | VIETNAM ECONOMIC TIMES | JUNE 2022                                               www.en.vneconomy.vn
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