Slight growth puts pressure on Vietnam’s retail supply

Vietnam’s retail supply increased slightly during the past quarter, reports Colliers Vietnam.

This is based on its research in Vietnam’s three largest cities.

Ho Chi Minh City

Total retail supply in Ho Chi Minh City has reached 900,000 sqm with the opening of Vincom Plaza Saigon Res in Binh Thanh. The five-storey shopping mall covers 5800 sqm.

At US$52.5 a sqm a month, the average asking rent in the city edged up 0.2 per cent, while the average occupancy rate was stable at 93 per cent.

Colliers’ research also shows that consumers in Ho Chi Minh City tend to prefer large-scale retail mixes with F&B and entertainment services. This might imply solid demand for retail space in coming years with a focus on locations outside the CBD because of limited supply, says the report.

Retail centres in the CBD are expected to be in high demand in the long term. The limitation of supply will keep occupancy rate tight while the average asking rent will have sustainable growth.


Two new projects, Artemis shopping centre and Hanoi Center Point, boosted the capital city’s supply by 33,400 sqm.

The six-storey Artemis is home to Big C, CGV, Tran Anh electronics supermarket and F&B outlets such as Dairy Queen, King BBQ, Lotteria, Swensen’s, Thai Express and Wrap & Roll.

Hanoi Centre Point is a seven-storey mall in a residential area.

Retail podiums had 11 per cent rental growth to reach $26.5 a sqm a month, with department stores maintaining their rates at $34.9 a sqm a month, and shopping malls marginally reducing their rents to $33.7 a sqm a month.

The average occupancy rate was stable at 83 per cent. Retail podiums achieved the highest rate, 94 per cent, while department stores had a four-point drop to 90 per cent. Shopping malls were steady at 80 per cent.

Fashion and cosmetics retailers dominate the leasing market, while entertainment services have been growing, says the report. F&B services have become more popular, especially in new retail developments.

In the upcoming three years, Colliers estimates 16 projects will join the market, providing about 825,000 sqm gross floor area.

“Despite being an attractive destination for international retailers to open their flagship stores, Hanoi’s limited prime sites in the CBD makes it challenging to secure a suitable location and meet expansion plans,”says the report.

Da Nang

With no new supply in the past quarter, space remains flat at 91,491 sqm in the resort city. The average retail rent fell by 5.4 per cent quarter-on-quarter while the occupancy rate at shopping centres eased 1 per cent to 98.9 per cent.

Colliers says this is mainly because of vacancies at Lotte, which has paused leasing because of a floor plan change.

With Vincom Plaza Ngo Quyen, Son Tra district is still the largest supplier of retail space with 36,800 sqm, accounting for 46 per cent of retail stock, followed by Hai Chau and Thanh Khe districts at 45 and 9 per cent respectively.

Da Nang’s retail model has been increasingly transforming into a more modern and developed market, which appears highly attractive to both domestic and international retailers, says the report. The total retail sales of goods and services in the review quarter reached $11.4 billion, up 7.1 per cent on the same period last year.

Frozen projects are expected to revived, meaning there will be an influx of shopping centres and retail podiums in Da Nang in the upcoming years, says Colliers.

In the coming months, more than 140,000 sqm of retail space is anticipated to be added to the market.

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