• Large-scale shopping centres (mega malls or hypermarkets) are becoming increasingly popular in Viet Nam, and numerous projects have recorded successful and efficient operations.

• Several experienced players, both domestic and international, such as Vincom, AEON, and Central Retail, share the market.

• Viet Nam’s consumer market has experienced significant expansion, with total retail sales of goods and services increasing by 8.7% in the first seven months of 2024. Although Ha Noi and Ho Chi Minh City remain key hubs, densely populated neighbouring provinces are now emerging as important consumption markets.

The Growing Excitement in the Mega Mall Arena

Retail spaces in Ho Chi Minh City, as well as across Viet Nam, represent a highly efficient investment segment with consistently strong occupancy rates.

According to the General Statistics Office, total retail sales of goods and services in July reached VND 3.625 billion, marking a 9.4% increase compared to last year. Over the first seven months of 2024, retail sales and service revenues rose by 8.7% year-on-year.

A June 2024 consumer behaviour study by PwC on the Asia-Pacific region reveals that Viet Nam has the highest online shopping rate in the region, at 67%, driven by the widespread use of e-commerce platforms like Shopee and Lazada. In-store shopping remains strong at 63%. The survey gathered feedback from over 7,200 consumers.

Ms Tu Thi Hong An, Senior Director of Commercial Leasing Services at Savills Viet Nam, notes that Ho Chi Minh City and Ha Noi each offer approximately 1.5 million square metres of retail leasing space, with occupancy rates consistently above 90% in recent years. This demonstrates the strong and lasting demand for large-scale shopping centres.

Investment in mega malls (those exceeding 100,000 square metres in floor area) is attracting significant attention and resources from domestic and international players, including Vincom, AEON Mall, Central Retail, and potentially Central Pattana, another member of the Central Group, in the near future.

“Domestic developers' greatest advantage lies in their understanding of the local consumer base, as well as their access to available land reserves,” explains Ms. An. “Conversely, foreign developers like AEON and Central Retail, with their long-standing reputations and strategies in regional retail markets, retain their competitive edge when entering Vietnam.”

The expert also points out several strengths of both foreign and Vietnamese investors in the retail sector. Foreign investors benefit from their established experience and reputation, which are crucial in retail development and operations. On the other hand, Vietnamese developers leverage their land reserves, ensuring coverage and expansion in the retail space.