More co-working spaces are expected of the back of its existing success.
It was only earlier this year that it was announced that the first co-working space was to be gracing the shores of Ho Chi Minh City. Six months on and the buzzing southern metropolis and Hanoi have 17 co-working space operators with 22 venues. This is according to real estate firm CBRE. All operators bar one are locally run, but regional names are keen to capitalise on the co-working success.
Co-working spaces are a hit for a number of reasons. Primarily they offer tenants flexibility with a host of services to ensure day-to-day business runs smoothly. They allow tenants to network with other tenants from different entities to help promote their offerings. Therefore the culture behind the co-working space need to be right. This is something that landlords need to strive for in order to entice and retain tenants.
The industry has a whole has unprecedented growth. Having grown 53 percent every year over a five year period, Vietnam has pipped the average with 58 percent growth. A number that is expected to increase even further with the big global names in the industry expected to make their entry onto the scene.
The facts
With such growth CBRE decided to carry out their own research on the industry and have reported the following:
- 91 percent of co-working space users are millennials, i.e. under the age of 35. For Vietnam this is above the global average of 67% reflecting Vietnam’s young demographics.
- Whilst the start-up boom is a key driver in the success of co-working spaces, more corporate tenants are using co-working spaces due to the flexibility and environments that co-working spaces offer.
- Rental fees vary for co-working space with Hanoi and Ho Chi Minh City being cheaper than most other cities in Asia Pacific. A direct result of cheaper office rental costs available in Vietnam.
- Whilst co-working spaces in many cities are in prime locations adding to their appeal, in Vietnam they tend to be in underutilised buildings in decentralised locations to keep costs down.
CBRE concludes that the co-working industry is essentially in its infancy in Vietnam. It expects rapid growth thanks to local and international operators. This new form of office setup will be driven by local start-ups and freelancers, international start-ups and freelancers, and increasingly by small corporates.