Hanoi may be the most expensive place to live in Vietnam, but commercial rent in downtown Saigon ranks amongst the most expensive in the world, according to recent statistics compiled by commercial property and real estate consultants Cushman & Wakefield (C&W).
With an average cost of US$1,540 per square meter in District 1, Saigon came in as the 32nd most expensive commercial rental market, outpacing that of more developed cities like Dubai, Doha, Bangkok and Manila.
In Asia, the only cities with higher rents are Shanghai, Taipei, Singapore, Tokyo and Seoul.
According to C&W, the growth of Saigon's rental market can be attributed to rising average incomes, stable economic conditions, a booming e-commerce industry, an emphasis on brick and mortar locations, and strong competition for space between international and local brands.
"Top foreign retailers consider Vietnam as a potential market in the region, given the fact that 36 percent of the total value of successful merger and acquisition (M&A) deals in Vietnam in the period of 2014-2015 was in retailing and consumer goods," Cushman & Wakefield wrote in its report.
It will be interesting to see if these prices can sustain themselves in the future, as over the next five or seven years, the total rental space in HCMC will rise 1.5 million square meters to 2.5 million square meters.
Office space in particular seems to be at a premium with Savills Vietnam recently reporting that such rentals have reached a record high occupancy rate of 94%.
