A Plethora of Premises in Ho Chi Minh City Remain Vacant: What’s the Story?

Despite positive economic and trade developments in the first half of the year, many of Ho Chi Minh City’s once-bustling streets, such as Nguyen Trai (District 5), Le Loi, Dong Khoi, Nguyen Hue, Le Thanh Ton (District 1), Cach Mang Thang Tam (District 1 – Tan Binh), and Ba Thang Hai (District 10, 11) are witnessing a persistent issue of vacant storefronts and “For Lease” signs.

According to Báo Người Lao Động reporters, Nguyen Trai Street, once known as the city’s “fashion street,” is now facing a wave of store closures. Fashion boutiques, restaurants, dental clinics, and spas have all shut down, leaving behind empty spaces. The proliferation of “For Lease” signs along this street has led to a decline in its vibrancy and overall appeal.

By contacting the phone number displayed on one of the vacant properties on Nguyen Trai Street, our reporter reached Mr. Cong Thanh, a real estate broker. He informed us that the property measures 4 meters in width and 12 meters in length, and it is currently available for rent at a price of 40 million VND per month. The rental conditions include a 3-month deposit and a minimum lease term of 3 years. Negotiations are possible for shorter-term leases. Mr. Thanh also mentioned that this space was previously occupied by a fashion business but has been vacant for quite some time.

Similarly, Ms. Minh Hang, another broker on this street, offered a more affordable rental option at 35 million VND per month for a 4-meter by 12-meter space, as the upper floor is occupied by the owner. She suggested that if the client is interested in establishing a brand presence only, they could consider renting a storefront on Nguyen Trai Street (District 1) for 50 million VND per month.

“For brand-building purposes, you might want to consider locations with better visibility, whereas online sales could be more effective for actual product sales,” Ms. Hang advised.

Our survey revealed that rental prices on this street range from 45 to 60 million VND per month for a single-front property with a width of 4 to 5 meters. Larger spaces, with widths of 8 meters and above, can command rents exceeding 200 million VND per month.

The brokers unanimously noted that while rental rates have dropped by 10 to 30% compared to the end of 2024, finding tenants remains a challenge.

Mr. Nguyen Tat Thinh, the founder of Housezy Joint Stock Company, attributed the prolonged vacancy of storefronts in Ho Chi Minh City to the changing consumer behavior coupled with the current challenging business landscape.

According to Mr. Thinh, industries that traditionally relied on physical stores, such as fashion (clothing, shoes, and accessories), cosmetics, snacks, and dining services, have swiftly adapted to the e-commerce trend. At the same time, the increasingly uncertain business environment has made investors more cautious about expansion decisions and renting storefronts. This cautious approach further dampens the market for storefronts, which was already subdued following the COVID-19 pandemic.

“Rental prices in Ho Chi Minh City have decreased by an estimated 20%, depending on the area, due to weak demand. The only way to improve the situation for these vacant spaces is to repurpose them, such as converting them into offices or flexible workspaces,” Mr. Thinh analyzed.