Offices along the Metro Line – The Future of Ho Chi Minh City Approaching
By the end of 2023, the office market in Ho Chi Minh City will be more vibrant with many new entrants joining the market. When Metro Line 1 becomes operational in 2024, office projects along the metro line will become focal points in the office market in Ho Chi Minh City.
Office Market Situation in Ho Chi Minh City Q3/2023.
In Q3/2023, the Grade A office market in Ho Chi Minh City welcomed two new projects in non-central areas (Thu Thiem, former District 2). These projects provided an additional 80,000m2 of high-quality office supply in Ho Chi Minh City.
Despite the global trend of abandoning offices in many areas, the office market in Ho Chi Minh City remained relatively stable in Q3. Especially in the Grade B segment, where rents and occupancy rates fluctuate less during the quarter. Meanwhile, for Grade A offices in the city center, the occupancy rate decreased by more than 7% (according to a report by Cushman & Wakefield) compared to the same period last year. The reason cited was the trend of closures and relocations of offices by many businesses, as well as the new attraction from Grade A offices outside the city center. Landlords of office buildings in the central area were noted to have more flexible and attractive policies, such as rent reductions, to attract customers.
In the future, areas outside or near the city center, such as Thu Thiem, will provide a significant supply of office spaces for the Ho Chi Minh City market
In Q4, Ho Chi Minh City will welcome two large-scale quality office projects coming into operation, promising to be a vibrant period in the market as investors increasingly focus on construction quality. Evidence of this is the growing number of office buildings with green office certifications and higher standards than before.
However, the Ho Chi Minh City market still faces an oversupply situation. Both office rents and the number of personnel working in Ho Chi Minh City are higher than in other economic centers in the region, such as Bangkok or Jakarta, by 2 to 3 times. The office market is not yet overly large, and with increasing demand, especially after the pandemic, the rents in Ho Chi Minh City remain relatively high, especially in the city center. Therefore, more and more businesses are choosing office locations outside the city center that still have good connectivity and are more affordable. Especially in 2024, when Metro Line 1 Ben Thanh – Suoi Tien becomes operational, offices along Metro Line 1 will become attractive magnets for businesses.
Explore more: Conveniently located office for rent near Metro Line 1 for easy commuting
Offices along the metro line – the future model of Ho Chi Minh City
Ho Chi Minh City has clear policies on experimenting with the compact city model, following the Transit-Oriented Development (TOD) urban planning direction, which means developing the city based on the transportation network, especially public transportation nodes. First, Ho Chi Minh City will experiment with this model on Metro Line 1 and Ring Road 3, then expand it to other metro lines and ring roads.
Metro Line 1 will be the first place to experiment with the compact city model in Ho Chi Minh City
With the vision of urban development in height, office buildings along the metro line are expected to flourish in the future, integrating multi-functional office buildings for dining, shopping, and entertainment. OneHub Saigon located in the Saigon High-Tech Park is a typical project for this model. It is a multi-functional office complex directly connected to Metro Line 1 at Station 12. The project integrates seven office towers and many functional buildings, accompanied by green spaces for outdoor activities. The office towers at OneHub Saigon are built to LEED green office standards, suitable for businesses focusing on sustainable development or prioritizing ESG criteria (Environment – Social – Governance). This is the future office model that businesses are waiting for, a versatile office solution, convenient for commuting, and sustainable infrastructure development.
Businesses prioritizing ESG in the future will be attracted to green offices along the metro line
Offices along the metro line will become the future model of Ho Chi Minh City, similar to what Japan and other developed countries are building. Offices will be concentrated near electric train stations, and bus stops, allowing workers to commute without personal vehicles such as motorcycles or cars easily. Not only improving traffic issues, the TOD urban planning model also helps limit environmental pollution from vehicle exhaust and noise. Additionally, it enhances the safety of people participating in urban traffic. The ability to connect with customers and attract talent for businesses with offices along the metro line will also be improved, helping businesses thrive. It can be seen that the office model along the metro line will bring many benefits for both landlords and tenants in these office buildings.
High-quality green office buildings bring many benefits to both tenants, users, and landlords
Another factor that tenants will prioritize is the cost, as the rent of offices along the metro line, such as OneHub Saigon, is much more optimized compared to offices in the central area, while still having good connectivity due to being located on the main axis and the advantage of metro public transportation. In the future, projects like OneHub Saigon located outside the city center will receive more attention, along with increasing competition for office buildings in the central area against new projects with strengths in both quality and rental prices.
Read more: Discover what Tech Hub is and the development opportunities for businesses in the High-Tech Park
Sustainable Development Trends in Office Construction in Ho Chi Minh City
Not only office buildings along the metro line like OneHub Saigon, but many office projects in Ho Chi Minh City are increasingly emphasizing sustainable development in the construction and operation of office buildings.
New office buildings are paying more attention to the working experience of employees inside the building. Factors such as thermal balance, indoor air quality, and efficient energy use are becoming more and more highlighted in the construction and operation of buildings. This not only brings health and well-being benefits to workers but also helps businesses operate efficiently and save costs. Landlords also find it easier to attract customers in the highly competitive market.
Green office buildings will bring health and well-being benefits to occupants
Green offices along the metro line are the type of offices that Ho Chi Minh City needs for the future. These buildings not only offer economic and transportation advantages but also contribute to achieving sustainable urban development goals in Ho Chi Minh City.
Conclusion
The office market in late 2023 in Ho Chi Minh City is predicted to become more vibrant with the increasing number of high-quality Grade A office projects coming into operation. Offices along the metro line are anticipated to represent a new future in the Transit-Oriented Development (TOD) urban model that Ho Chi Minh City has envisioned. Green office projects along the metro line, such as OneHub Saigon, will pose strong competition for traditional office buildings, meeting various criteria that businesses are currently concerned about.
Learn more: Data center with over 70 million USD investment – 1Hub Data Center
