VietNamNet Bridge – Vietnam is facing office property crisis as supply outstrips demand, said PropertyWire of the UK on April 13.
According to the global property news service provider, office rents in Ho Chi Minh City have plunged by up to 50 percent and the trend is expected to continue.
PropertyWire also cited various international analysts as saying that this trend is attributed to belt tightening due to the global economic downturn.
Global real estate companies Cushman & Wakefield, Savills and CB Richard Ellis said top quality office space rents have fallen to 43 USD per square metre this year from a peak of 70 USD per square metre at the beginning of 2008; second-class space rents down from about 45 USD per square metre to between 28 USD-40 USD and third-class office space from 39 USD to between 14 USD-25 USD.
PropertyWire quoted CB Richard Ellis managing director Marc Townsend as saying that office demand is closely linked with employment and financial stability and firms were tightening their belts, cutting jobs and also cutting costs on office rents.
The deteriorating situation is compounded by an increase in vacancies and 1.25 million square metre of new office space predicted to come into the market this year, adding to the downward pressure on rents, according to CB Richard Ellis.