By
Vu Pham, Minh Hue
Fri, January 24, 2025 | 10:05 am GMT+7
The Hanoi office market will be a tenants’ market by the end of 2025 or even 2026, so developers need to change their financial equation to bring more attractive incentives to tenants, said Hoang Minh Nguyet, senior director for commercial leasing at Savills Hanoi.

Hoang Minh Nguyet, senior director for commercial leasing at Savills Hanoi. Photo courtesy Savills.
What is your assessment of the Hanoi office market trend in 2025?
The 2024 market recorded a good rebound in the second half, when a series of companies had their plans to relocate, expand, or open new offices approved. This will help the market demand in 2025 to rise. We expect the absorption rate of vacant areas in 2025 to be higher than in 2024.
This year, the market will have many new sources of supply, giving tenants more choices. At the same time, it will increase competition among developers in terms of rental prices, building quality, and other rental incentives to attract customers.
Abundant new supply can lower the occupancy rate of the entire market. But the market will have much more positive activities in terms of both supply and demand in the new year.
Regarding tenants’ demand for office space, is there any difference compared to previous years?
At the end of 2024, we conducted a survey with nearly 500 businesses that are currently tenants of class A and class B offices, with an aim of better understanding the demand of the office market in 2025-2026. The results provide interesting information about the continuous shift in office demand.
First, the selected office location. The demand has shifted from the Hoan Kiem district area to Ba Dinh and Cau Giay districts. The percentage of tenants interested in the Hoan Kiem district area decreased from 45% in 2021-2022 to only about 25% in 2024.
In addition, tenants expanded their search, instead of focusing on just one area to find rental space as before. Almost all tenants pay attention to at least two different areas when looking for a new location, which can be Hoan Kiem or Ba Dinh, Cau Giay or Ba Dinh, Dong Da or Tay Ho.
This is understandable as the Hanoi market has achieved diversity and differentiation in terms of administrative/office locations. Therefore, tenants have more choices, and their choices will no longer be limited to one area. This means tenants will have more ability to negotiate with owners to achieve better rental conditions than before.

Taisei Square Hanoi office building in Hanoi. Photo courtesy of the building.
Which industries will have high demand for office space this year?
Information technology and manufacturing will still be the leading industries in terms of office space rental, because they often require very large rental spaces, with the average area of up to over 1,000 square meters of floor space.
Taking into account the number of office rental transactions in the 2025-2026 period, companies in the consulting sector, including financial and legal consulting, and the distribution and education industries may take the lead thanks to their rapid development in the coming time.
Is the office real estate market in Hanoi a tenants’ market?
With the large supply across the districts as it is now, the Hanoi market is clearly more beneficial for tenants. They now have more choices so they become more demanding.
We believe that until the end of 2025, even 2026, the market will still be largely in favor of tenants. Therefore, developers need to make better financial calculations to bring more attractive incentives to tenants.
What do office owners need to change to attract tenants in 2025?
In the past, owners would simply need to build a building and rent out empty space. Now, they have to provide more to tenants.
Because the market is very competitive, most buildings are built in a meticulous manner and Class A buildings are all aiming for green certification. A green certificate is now almost a must, especially in the context of climate change, air pollution, and environmental pollution, along with the need for businesses to ensure the requirements of achieving Net-Zero goals.
Services in the building are also a concern. Currently, buildings that are built later tend to compete by providing more services to customers. Dining areas for employees, gyms, green spaces are services that many owners add to retain tenants.
Some developers are very flexible in rental policies. They even support tenants to invest in perfecting interiors. Many tenants can sign management and operation contracts in cooperation with serviced offices, coworking spaces, and shared offices. Owners now can add more amenities in service of tenants.
Therefore, to compete amid the large number of office supplies, owners should expect reasonable prices, offer attractive rental policies, and provide more internal services.
From: The Investor
Real Estate News