Hard to find a corner office in HN
Viet Nam News, March 09, 2005
HA NOI — Finding a high-class office for lease is becoming increasingly harder for business owners in the capital due to the full occupancy of most high-rise buildings.
With the increase in demand for office space, high rise owners expect that Ha Noi will run out of office space by June this year.
The twin towers of Vincom, the city’s newest high-rise, has already had the whole of the A tower leased by the Bank for Investment and Development, and tower B, with more than 14,000sq.m for office lease, has a 70 per cent occupancy.
Le Khac Hiep, director of the Viet Nam General Trading Joint Stock Company which manages Vincom’s operations, said more than 1,000sq.m is reserved for a US company to set up a cinema next month. He expects that the remaining space will be leased soon.
Nguyen Hong Minh, director of Ocean Park building which is owned by the Viet Nam Marine Corporation, said the whole building has been leased, with foreign companies taking 70 per cent. He has warned that Ha Noi will run out of high-class offices for lease by June.
The nine-storey Artexport building, which is still under construction, has already had most of its available space reserved and now only has the top two floors available.
Unofficial statistics show that Ha Noi has 80,000sq.m of high-class office space for lease with monthly rents ranging from US$18 to 23 per sq.m.
Minh estimated the demand for high-class offices by the third quarter in the capital will be increase by 8,000-9,000sq.m.
Hiep echoed the prediction saying that the demand for high-class offices will boom in the near future, blaming the inflow of foreign investment (FDI) as the main reason for the rise.
In the past two months, Viet Nam has licensed 97 FDI projects with total registered capital of $1.032 billion with nine projects worth $824.3 million pouring into Ha Noi. Last year, Ha Noi enticed more than $290 million in foreign investment capital garnered from 74 new and 32 established projects.
Hiep said some local private companies that need comfortable offices for operations also pushed up demand. Another reason for the excess demand, he said, was the reasonable rents for such A-class offices with prime locations and large parking areas which has dropped dramatically from prices in 1997 when they ranged from $30-70 per sq.m.
More affordable offices are reported to have a 90 per cent occupancy, however, real estate experts said the demand for these offices will become saturated by 2007.
