List of the 34th edition of Global Retail Avenues, showing the world’s most expensive retail areas. Đồng Khởi in HCM City continues to be the most expensive street in Việt Nam. – Photo Courtesy of Cushman & Wakefield

HCM CITY – Đồng Khởi Street in HCM City, the country’s most expensive retail destination, ranks 14th globally, according to a report by Cushman & Wakefield.

Rents there are US$330 per square metre per month, up 32 per cent from before Covid-19 but down 6 per cent from last year mainly due to the local currency’s fluctuation against the US dollar.

Trang Bùi, country head of Cushman & Wakefield, said: "The luxury retail market in Việt Nam is growing strongly and attracting the attention of many international brands.

“Đồng Khởi is one of the busiest and most famous streets in the centre of HCM City, with proximity to many high-end hotels and famous tourist attractions, helping to attract a large number of potential high-end consumers.

“Many luxury brands have chosen Đồng Khởi as a location to open stores and position their brands in Việtnam.

“Being present on this street helps luxury brands not only reach their target customers but also maintain and enhance their luxurious and classy image.”

When Việt Nam's first shopping malls like Tràng Tiền Plaza in Hà Nội and Tax Trade Centre in HCM City opened, the total retail supply of commercial retail space was around 30,000 sq.m.

According to Cushman & Wakefield, between 1996 and 2019 an average of 97,000 s.qm was added each year in the two cities.

The retail market skyrocketed between 2013 to 2019 with 195,000 sq.m of new retail space entering it each year. But in the past five years supply has slowed down, especially in the central core area, which has been the main driver of rentals.

In Tràng Tiền Street in Hà Nội, the rental rate is $300 per month, up 50 per cent from the pre-pandemic level and unchanged from last year.

According to the Asia Pacific Market Ranking in the report, Tràng Tiền has the 18th highest retail rental price.

The Cushman & Wakefield report also said: “Brands, from luxury to mass market, are doubling down on their physical stores in the top locations as competition for consumer attention drives the need for a superior shopping experience and product showcase. While e-commerce plays a role in an omni-channel strategy, it is the physical embodiment of the brand that customers connect with.

“As a result, vacancy rates remain exceptionally tight which translates into the rents that retailers are willing to pay to secure and retain their space.” – VNS