These are the new entrants in Vietnam’s luxury retail market

Louis Vuitton and Christian Dior recently opened new flagship stores in Central Hanoi.

According to a Savills report, Ho Chi Minh City and Ha Noi are still the only two cities in Vietnam attracting interest from luxury retailers. For prime space, there is still healthy demand from retailers, lending resilience to the rental market.

Prime retail rents recorded a mild drop of 3.5% in Ho Chi Minh City but surged 11.1% in Ha Noi between 2H/2019 and 2H/2021.

Here’s more from Savills:

On average, the average prime retail rent stood at VND2,912,900 and VND3,096,400 per sq m per month in Ho Chi Minh City and Ha Noi respectively. Occupancy, in general, has remained stable with increased landlord and retailer confidence apparent.

The market has seen a number of new entries in Ho Chi Minh City in the last year. Christian Louboutin set up its first store in the city at Rex Hotel while Montblanc and Marc Jacob both committed to space within Saigon Centre. GlobalLink, a major luxury distributor in the country, plans to open a 700 sq m duplex store later this year in the city, housing a variety of brands, including Off -White, Ambush and Amiri. Meanwhile, Louis Vuitton and Christian Dior have opened new flagship stores of over 1,000 sq m and 500 sq m respectively at the International Centre in Central Hanoi.

The majority of international brands are still represented by distributors, some with exclusive rights. This does create some challenges for expansion, as brands depend on the ability of the distributors to develop and invest in the portfolio. We have therefore seen more luxury brands considering entering the market on their own instead.

Furthermore, the long-awaited Metro Line 1 in Ho Chi Minh City is scheduled to open in 2023, with the hub situated at the historic Ben Thanh market and roundabout. The construction of the metro line has disrupted the CBD for several years. The opening will reposition many of the CBD high streets and bring forward key development sites such as Viva One Tower. This will provide some much-needed new quality supply to compliment the revitalised CBD in Ho Chi Minh City.

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Savills

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