Serving both residential and commercial purposes, shophouses are increasingly expensive but still go like hot cakes.
For example, at a project in the West of West Lake (Hanoi), the price of shophouses traded on the secondary market reaches roughly $10,800 to $11,600 per square metre, while one of terraced houses is only about $6,500 to $8,600 per square metre.
Previously, some projects such as Times City Park Hill, Vinhomes Gardenia in Hanoi or Phu My Hung in Ho Chi Minh city offered a limited number of shophouses at high prices, but they were quickly sold out. Customers even had to make a lucky draw to get an opportunity to buy one.
Shophouses are also the segment with the most robust rate of increasing price recently. According to CBRE’s data of the first quarter, the price of shophouses in Ho Chi Minh city increased by 261 per cent year on year, while villas and terraced houses only rose by 35 to 37 per cent.
Initially, shophouses were introduced to serve both residential and commercial purposes. Owners can rent them or do their business, such as groceries, restaurants, cafés, spas, for residents in a neighbourhood.
However, recently, new trends have emerged, including shophouses for tourists only, or residential complexes integrated with health care function.
For example, the Mon Bay project in Ha Long recently introduced itself as a festival real estate. Located at the exceptionally favourable position on Tran Quoc Nghien road, which goes along the coast, and opposite to the Square 30/10, which holds important events of Quang Ninh province, Mon Bay also pioneered to celebrate such festivals as "Asian Food and Culture Festival" or "EDM Festival".
Investors said that festivals held by Mon Bay were expected to attract millions of domestic and international tourists each year so that customers could buy terraced houses or shophouses to live in or open mini-hotels, restaurants, spas.
Another segment that has just emerged but immediately attracts investors is the medical real estate. The developer DRH Holdings plans to introduce the 139-unit commercial and healthcare service complex Symbio Garden, which lies opposite to the Ho Chi Minh City Oncology Hospital 2 project in District 9, Ho Chi Minh city.
According to Ngo Duc Son, Deputy General Director of DRH Holdings, the Symbio Garden project was developed to support Ho Chi Minh City Oncology Hospital 2, in which doctors, pharmacists and investors could buy a house to run their business or rent it as a clinic, a drugstore, a rehabilitation center, a restaurant, or a mini-hotel. This model has been successfully developed in Sweden and is being hunted by experienced investors in Ho Chi Minh city.
According to Nguyen Hoai An, Head of Market Research and Consultancy, CBRE Vietnam, the ability to rent for business and profitability of shophouses are the decisive factors for investors.
Most of the projects are located in areas which have quite a large size of the population coming from the neighbourhood. Hence, these products always have a high potential of approaching customers, which increases their value.
On the other hand, the number of projects with shophouses is not high. They are only found in projects with synchronised infrastructure, built by major investors.
Hence, shophouses are considered rare as they are always in short supply for customers. In urban area projects, shophouses account for only 1 – 3 per cent of the total number of products. As a result, projects for sale have all experienced high liquidity; some are even sold all units before the official sale.
Similarly, for the medical real estate, despite enormous profitability coming from rental and price hikes, there are few opportunities for investors due to scarce supply.
