A series of central premises in Hanoi and Ho Chi Minh City continue to be vacant.

A series of premises on central streets of Hanoi such as Kim Ma, Nguyen Thai Hoc, Hang Bong, Pho Hue, Xa Dan, Kham Thien, Nguyen Luong Bang... are all vacant. Some of the front houses have not been able to find tenants since the end of last year.

On Kim Ma Street, just on the odd-numbered side from the intersection of Nui Truc and Nguyen Thai Hoc, there are about 30 shops that have closed or are hanging signs for rent. Previously, this street was crowded with women's clothing and fashion accessory stores.

Not only offline, on many online groups, there are also dozens of ads for renting street-front houses, transferring fashion stores, spas, coffee shops... in Hanoi every day. Quynh Anh - the owner of a spa in Cau Giay district is looking for someone to rent the store for 20 million VND per month (not including the spa transfer fee), when there is still more than a quarter of rent left. She made this decision because business has not been favorable since the beginning of the year, the landlord recently also wanted to increase the rent by 10% in the next contract period. However, thanks to both brokers and posting ads herself since the beginning of May, Quynh Anh has not found a partner yet.

Shophouses are also in a slump. In a project handed over early last year in the Tay Ho Tay urban area, there are still less than 10 units with tenants, including a Korean bank that has rented 2 units as its headquarters. Many townhouses in Nam Tu Liem, Ha Dong or Long Bien are not doing any better, although the investment price of each unit 3-4 years ago was over 20 billion.

Ms. Minh Thu, a broker specializing in selling and renting residential land in the center of Hanoi since 2017, commented that never in the past ten years have there been as many choices of beautiful premises as now. "Previously, shops in Kim Ma, Chua Boc cost 15-20 million VND or a 4.5-storey house in Xa Dan had not yet been sold, but new customers were flocking to see. But now, renting is much more difficult, even when the landlord has support policies such as reducing the deposit, paying 3 months instead of half a year," Ms. Thu said.

Similar, In Ho Chi Minh City, a series of houses on prime streets in District 1 such as Nguyen Hue, Le Loi, and Ngo Duc Ke have not been able to find tenants, and some have even been left empty since the pandemic.

Mr. Hung, a broker with many years of experience specializing in houses in District 1, said that a property that used to be a luxury Japanese restaurant has been abandoned for a long time. However, according to him, the owner still keeps the rent high at about 300 million VND a month. On Le Loi Street, many houses facing the sea are also for sale and rent.

Renting townhouses and shophouses in District 7 is also not convenient. On the main roads in Phu My Hung such as Nguyen Van Linh, Cao Trieu Phat, Phan Khiem Ich, Pham Van Nghi, dozens of houses are also covered with classified ads and for rent.

These shophouses were previously busy places for restaurants and banks. The wave of returning premises in District 7 has lasted since the end of last year. However, many landlords are still determined to keep the rental price. A shophouse of over 100 square meters on Nguyen Van Linh Street is being offered for 48-50 million VND per month. The owner of this house, which used to be a hair salon, does not agree to reduce the tax, but if he is willing, he can support the customer by reducing the deposit from 4 months to 2 months.

The wave of returning premises in Hanoi has been taking place since the second half of 2020 after the first wave of the pandemic, causing rental prices to drop locally in some areas. Townhouses in the central area have been sought after by businesses again since mid-2022. However, the warmth in the rental market did not last long when the situation of returning street-front houses gradually recurred since the end of the third quarter of last year.

At the beginning of this year, some market research units also commented that the situation of unsold premises on many central streets is becoming more and more common. Experts at Savills said that the reason is due to high rents and fierce competition from e-commerce. Accordingly, retail rents on the first floor or street frontage on many streets in Hoan Kiem district in early 2024 are 20% higher than before the pandemic and are forecast to continue to increase.

According to the leader of a real estate consulting and brokerage company based in Tay Ho district, the vacant space partly reflects the fact that consumers are increasingly tightening their purse strings for non-essential activities. This makes many businesses, especially cafes, restaurants, fashion, beauty, entertainment... operate more difficultly.

Along with that, he also assessed that the current shopping trend is increasingly shifting to the online environment, causing many units (except for large retailers, cafe and restaurant chains, or franchise brands) to reduce spending on premises. "A reduction of 10-15 million VND in monthly rental costs can also help many small fashion business owners convert it into advertising costs, hiring more staff to answer customers, and closing online orders," he said.

In fact, Mr. The Manh, who has been selling exported clothing in Hanoi since 2010, has always chosen a store on the main street in Hai Ba Trung and Ba Dinh districts. But since last year, he has decided to move the store to a smaller alley in Giang Vo because the number of customers coming to the store has been decreasing, now mainly ordering online - on average accounting for over 70% of monthly sales.