Becoming survival of the fittest

BIDV Tower Joint Venture Company deputy general director Dang Minh shares VIR why office leasing market competition would become tougher in 2012.

The year 2011 is a tough time for developers in office leasing field. Could you brief us on BIDV  tower’s business performance?

BIDV tower came onto the market from the second quarter of 2010. This is an grade A office tower with 25 floors covering more than 34,000 square metres in total area with 1,000sqm in each floor.

Since its debut around two years ago the tower often reports high occupancy rates, now reaching 96 per cent, thanks to its premier position in the heart of Hanoi capital and on the back of well-conceived business strategies.

What sort of tenants are there?

Around 20 big trademarks have jumped onboard the BIDV tower. Some of them are our major stakeholder BIDV, Prudential, Dragon Capital, Piaggio, Tetra Pak and Dell, just to date a few.

Hanoi’s office leasing market features stiff competition between developers to retain old tenants and lure new ones. What are the company’s tactics to stay afloat of tough market conditions?

Generally Hanoi’s Grade A office leasing market in 2011 has witnessed a fierce competition but mostly at towers situated west of Hanoi or those not having ‘good places’ in the city inner areas.

Despite our late presence from early 2010 the company took advantage of BIDV tower’s premier location and the quality of service we provide to tenants. Besides, we offer customers competitive rental rates.

Hence, though the office-for-lease market was hurt by global economic recession in 2010 right in the first year coming onto the market BIDV tower reported occupancy  rate of 86 per cent. At this point of time, the occupancy rate reaches 96 per cent and we expect tower area will be fully leased in the coming period.

Our management, however, always strives to constantly improve the service quality to satisfy tenant requirements and stand out from competitors.

What is your office leasing business forecast for 2012?

We perceive the world  and Vietnam’s economy will continue facing numerous difficulties in 2012. Hence, competition would be tougher in 2012 in Grade A office leasing market in Hanoi’s inner districts, partly due to a supplemental supply from EVN tower, Conerstone building and some other towers. To retain tenants, we will strive to bring them the best utilities and working environment. Our target is to turn BIDV tower into best quality Grade A office tower in Hanoi.

BIDV is equitising. What is the Vietnamese party stake in BIDV Tower Joint Venture?

Our major stakeholder BIDV works on equitising plan from December 8-28. Its initial public offering (IPO) will be held on December 28. The BIDV Tower Joint Venture Company consists of BIDV which holds 55 per cent of joint venture stake and Singapore-based Bloomhill Holdings. We hope BIDV tower would contribute to ameliorate BIDV image during equitisation process.