Vietnam Central City Sees Rising Demand for Office Lease: Savills

 

The increasing number of businesses in the Vietnam’s central Danang city has pushed demand for office lease segment up in the locality, real estate service firm Savills Vietnam said in a recent report.

 

The report says the number of new-established firms in Danang has grown steadily over the past five years, adding that the city licensed 2,100 new businesses in 2009, up 23% from a year earlier.

 

Overseas Vietnamese or Viet Kieu have to date invested in 60 companies totaling US$500 million in Danang, which has had an positive impact on the local office market, Savills added.

 

The city now has 21 office buildings covering a total area of 66,000sq.m with the addition of the Lilama L7 SJC building, representing a 3% rise against the first quarter. Most of the buildings located at Hai Chau and Thanh Khe districts with the former accounting for 80% of the total supply.

 

In the second quarter of this year, the city’s average rent was US$11/s.q.m per month, a six-percent decrease over the previous quarter.

 

Savills forecast that 14 realty projects will become operations in the next five and seven years, providing additional 94,000 s.q.m for the local market. More than two-thirds of the office space will be situated in Hai Chau and Son Tra districts.

 

At present, Danang has 11 apartment projects with 2,300 units Savills said, noting that rich Vietnamese people are the main customer group for the city’s apartments and villas with those from Hanoi making up 80%, followed by Ho Chi Minh City with 13% and the rest from foreigners and Viet Kieu. (vietnamplus.vn)