Tax Trading Centre in HCM City.

VietNamNet – Business leaders still consider Vietnam’s retail market “underdeveloped”, a CB Richard Ellis’ (CBRE) representative said at a press conference yesterday afternoon in Hanoi.

Marc Townsend, CBRE Executive Manager, said that the number of trade centres in Vietnam remains modest and the professional retail market is developing too slowly to satisfy demand. Mr Townsend cited an example to show the consumption habits of the Vietnamese: they still prefer travelling great distance just to buy a small product that is a little cheaper than the same offered in a trade centre for more.

In Hanoi, for example, residents travel by motorbike and are more mobile. They can get to the ‘shops in houses’ that have become popular of late but which hamper the development of the trade centre.

According to CBRE, a commercial real estate company, the problem lies in the lack of completed buildings reserved for trade. There are too few choices for local distributors who want to develop their brand names. The dearth of space also limits market access for foreign business.

There are now at least seven trade centres in HCM City with a total area of 8,000 sq.m, while Hanoi has only three large trade centres with a total area of 12,000 sq.m. All command fees of between US$15/sq. m/month and $100/sq.m/month.

Despite the high leasing fee, however, the occupancy is 95% at several centres and CBRE forecast that leasing area at trade centres would increase dramatically in the next two to three years.

HCM City is forecast to develop 100,000 sq.m of floor area with trade centres such as Hung Vuong Plaza, Saigon Paragon, Binh Phu, Time Square, Saigon Pearl, Satram, Tan Da and Saigon M&C Tower. Hanoi will also develop 250,000 sq.m at Cau Giay Complex, Ciputra Mall, ICC Building, Luxury Mall, Pacific Place, Melinh Plaza, Viet Tower and Syrena. Of these, Ciputra Mall is expected to be the largest with a total area of 103,000 sq.m, which will include 1,200 stalls and 48 cafés and supermarkets.

Kieu Minh