Gia Lam becomes a district, which real estate segment will "upgrade"?

Potential of real estate in Gia Lam

According to Savills Vietnam, real estate in Gia Lam has many growth prospects, because this is the gateway area of Hanoi connecting to the Northeast economic triangle, including Hai Phong, Hai Duong , Quang Ninh; directly adjacent to the two provinces of Bac Ninh and Hung Yen, which are considered the "capitals" of industrial parks in the Northern economic corridor.

Gia Lam's elevation to a district will have a strong impact on the real estate market in this area. (Photo: LD)

Furthermore, Hanoi is also rapidly developing and improving its transport infrastructure to enhance connectivity and reduce traffic pressure in the inner city.

In particular, when becoming a district, Gia Lam will benefit from the mechanisms and policies of an inner-city district, including promoting investment in construction, renovation and upgrading of technical infrastructure.

Thanks to the above advantages, Gia Lam is expected to have an advantage in the office segment.

Ms. Hoang Nguyet Minh, Senior Director of Commercial Leasing, Savills Hanoi, analyzed: Office is still one of the sectors with very good and attractive investment returns.

Often when a building reaches average occupancy, the profit margin for an entire office building can be as high as 65%, or even 70% of revenue. This is a very good profit margin.

“At the same time, when the trend of businesses moving out of the center continues to be clearly recorded and vacant space in the central area is still limited, areas like Gia Lam, which is preparing to become a district, need attention,” said Ms. Minh.

According to Savills research, office supply is mainly concentrated in the Western region, including Bac Tu Liem, Nam Tu Liem, and Cau Giay districts, with a market share of 50%, equivalent to about 873,700 square meters.

On the contrary, Gia Lam currently does not record much office supply, not to mention high-quality and green-certified supply.

Meanwhile, Ms. Chu Thanh Huong, representative of Vinhomes Office Leasing, said: With the orientation of developing an international quality office building and demonstrating a strong commitment to sustainable development, TechnoPark Tower is our first project to successfully conquer the strict LEED Platinum classification.

This achievement not only brings to the market an international quality office building, meeting the requirements of sustainable development, creating a healthy working environment for the tenant community, but also contributes practically to Vietnam's roadmap towards Net Zero.

Savills experts emphasized that Gia Lam is a special area in terms of business. Therefore, the tenant structure is quite different compared to Hoan Kiem area, which concentrates on financial and banking enterprises, government organizations , or the West of Hanoi with a large density of companies in the fields of information technology, insurance, and real estate.

Because it is located around industrial and manufacturing centers such as Bac Ninh and Hung Yen, Gia Lam will attract FDI enterprises or multinational companies with factories located in neighboring industrial parks.

Housing and apartments still have prospects

Meanwhile, Mr. Nguyen Van Dinh, Chairman of the Vietnam Real Estate Brokers Association, also said that besides offices, housing and apartments still have growth prospects in this area, thanks to the relatively abundant land fund.

Besides offices, housing and apartments still have growth prospects in Gia Lam. (Photo: PD)

According to Mr. Dinh, in the past 10 years, real estate in the East of Hanoi in general and Gia Lam in particular has had impressive development progress. From the low-income housing sector, this area has witnessed the arrival of many real estate giants with the penetration of diverse types of real estate.

Therefore, in areas with systematic and quality investment, creating high value and increasingly improving quality, attracting customers and the wealthy, elite community, the growth rate will be higher.

"I think that in urban areas like the East of Hanoi, price and profit growth of about 10% - 15% will be guaranteed," said Mr. Dinh.

According to a report by the One Mount Real Estate Center for Market Research and Customer Insights, the high-rise supply in the Eastern region in the next 3 years from 2023 - 2025 is expected to welcome about 92,900 new apartments for sale.

One Mount Real Estate also believes that as the land fund in the inner city is gradually depleted, Hanoi has been implementing policies to limit population in the core area, redirecting people to suburban areas such as Long Bien, Gia Lam and satellite areas such as Van Giang (Hung Yen).

In addition, according to the development planning of the capital and Van Giang, by 2030, the Eastern region is expected to have 1.05 million people, an increase of 39% compared to 2022. These population factors will create a great demand for housing in the Eastern region in the coming time.

Source: https://www.congluan.vn/gia-lam-len-quan-phan-khuc-bat-dong-san-nao-se-len-doi-post268339.html