The increase in foreign investment and the constrictions on foreign companies to develop in Vietnam through representative offices or having commercial presence in the country is forecasted to result in an increasing demand for international standard “offices for lease”. The newcomers on the office leasing market are expected to meet these demands by offering smart options which proved to be very efficient over the world.
Scarce and costly
CBRE, in its report on October 22, stated that after Vietnam joins the TTP, the demand for office lease will considerably increase in order to meet foreign companies’ requirements, while the supply of high-standard serviced offices remains limited in Hanoi and Ho Chi Minh City at the moment. No new high-standard office for lease project has been registered in Hanoi since the beginning of 2015, which caused a 0.3 per cent increase in the average renting price of high-standard offices in each quarter. For grade A office buildings an 82 per cent increase in occupancy rate was recorded at the end of the third quarter, meaning 3,800 square metres of Grade A office space was taken up in the third quarter only.
Foreign enterprises accounted for the larger portion of this newfound demand, and were assisted by CBRE. In addition, CBRE reported that areas highly rated for office leasing by companies are well-connected to the city center and offer good office quality, as rated by current tenants.
Prospects of the newcomer
Tan Heng Thye, managing partner of CSP Legal LLC (Singapore), when giving advice to foreign investors, noticed that the demand for high-standard offices to lease in the city center or at well-situated areas was recently high. When embarking on business in Vietnam, a number of foreign investors establish their representative offices with only 2-3 employees, to research the market before making substantial commitment. If they find the market in Vietnam favourable, they will continue to develop their business here. Otherwise they may shrink in size or even shut down presence in the country. A number of foreign companies complained that it took a great deal of time and financial resources to find and establish a traditional office and when they needed to expand/shrink or shut down, they met unexpected complications as well.
Skyline Serviced Offices, an innovative model of office leasing in Hanoi, can solve these concerns. Located at the top of an international standard building - the Prime Center in Quang Trung street - Skyline is composed of several offices with areas ranging from 8 to 30 square metres designed to accommodate 1-8 people. All offices offer a modern and elegant design and are fully-furnished with furniture, equipment, hygienic washrooms, running water, IT as well as telecommunication devices, such as landline, high-speed internet, and multilingual reception. Customers only need to carry their laptop to work.
All Skyline offices feature large glass window-walls which offer a magnificent view on Thien Quang lake and the skyline of Hanoi. According to geomancy, offices surrounded by natural water sources bring luck and fortune. Skyline offers a wide range of office leasing packages on a daily, weekly, monthly, and yearly basis, but remains flexible to customer demands. Additionally, Skyline offers virtual offices with different packages: registering business transaction address, putting through calls or leasing luxurious meeting rooms to receive business partners.
Traditional offices are a thing of the past
One of customers’ common concerns is the rent of the leased offices. Traditional offices seem to be cheaper than serviced offices due to the lower rent charges calculated on a per-square–metre rate. However, Skyline’s serviced offices live up to the challenge and turn out to be more economic and efficient for enternprises in search of small-scale representative offices or branches. Skyline offers shared areas, icluding the reception hall, a lobby to receive guests, a print and photocopy area, kitchen area (fridge, tables, etc.), which cut down renting expenses and provide more office space. Enterprises do not need to make large investments into infrastructure and large meeting rooms with costly video conference equipment which they use once a month. Skyline offers a virtual office package at a reasonable price, which may prove suitable for the different needs of different enterprises that only wish to create a mailing address.
Although serviced offices are new to Vietnam, they are flourishing in developed economies, especially in Hongkong. For instance, Compass, established in 2009, currently owns nearly 20 serviced office areas in Hongkong and 30 leased offices in 13 other countries. Catching up with this new trend of serviced offices, Skyline provides small and medium-sized enterprises with a new choice of efficient offices in Hanoi.