HANOI – Rentals of the office leasing segment in Hanoi will continue falling in the coming time, according to many local research market companies.

A recent report of CB Richard Ellis Vietnam (CBRE) shows that grade B office rent dipped by 7% while rent of grade A spaces tumbled 3.6% in this year’s third quarter, with a contraction of up to 9% recorded at a number of buildings. As of the third quarter of 2012, the whole market in Hanoi had about 172,000 square meters which were yet to be leased out, with grade A offices accounting for 27% and grade B type over 18%.

Chu Thanh Huong, senior manager of office leasing department of CBRE, noticed office tenants of her company in recent times had mainly come from drug, finance and information technology industries.

Similarly, real estate services provider Cushman & Wakefield recorded several transactions it finalized in the third quarter were of office tenants in medicine areas planning to expand business in both Hanoi and HCMC.

In Hanoi, Merck Sharpe Dohme, a big pharmaceutical company, has moved from A Chau Building in Hoan Kiem District to Keangnam Landmark Tower in Cau Giay District. The firm asks for a building that is near hospitals, hotels and the Ministry of Health’s office along with other facilities suitable for laborers.

According to Cushman & Wakefield, those owners with good reputation have still retained tenants by slightly reducing rates in line with the management quality of the buildings.

Huong of CBRE, meanwhile, pinned high hopes on the better outlook of the market in the coming times. It is because many project owners have suspended their schemes and this has resulted in the supply of office leasing areas only edging up compared to previous quarters, she reasoned.

The Saigon Times Daily