28 Jun 2024
Creating value for tenants in Vietnam: Do more with ‘lease’
Hong Anh Nguyen, Head of Commercial and Industrial Leasing, Frasers Property Vietnam
When the idea for Worc@Q2, a sleek, 32-storey tower near the banks of the Saigon River was mooted years ago, it was an exciting and novel proposition. The serviced office building, replete with amenities, would be a unique addition to Vietnam’s property market.
Then COVID-19 happened. In 2021, the project was launched in Ho Chi Minh City amid the country's largest coronavirus outbreak. Occupancy was a mere 20 per cent at opening. It was time to come up with a new strategy, realised Hong Anh Nguyen, Frasers Property Vietnam’s then Head of Commercial Leasing.
The team quickly adjusted its approach, shifting from engaging one exclusive leasing agency to casting a wider net with multiple agencies and raising agent commission fees. It also took its marketing in-house and engaged directly with prospective tenants once the agents had referred them.
“After all, we know the building and our strengths best,” Hong Anh noted.
Occupancy rate has since risen to a healthy 90 per cent, with most tenants coming from the manufacturing and oil and gas sectors.
Hong Anh discussing with her colleagues at Frasers Property Vietnam's office, Melinh Point
“We focused on foreign SMEs (small and medium-sized enterprises) that had a good budget, but preferred to be located outside the traffic-congested CBD,” she added.
The leasing strategy for Worc@Q2 exemplifies Frasers Property Vietnam’s approach to leasing: target the right people and shine a light on the property’s strengths – stellar amenities, good service, and a commitment to sustainability.
Serviced office tower Worc@Q2 is a recipient of LEED Gold certification for Operations and Maintenance v4.1 by the U.S Green Building Council, marking our Vietnam business unit's first LEED Gold certification for a commercial building. The development is located in the Thao Dien ward within the heart of District 2.
Green buildings
Located in the prime district of Thao Dien, Worc@Q2 has a whole floor dedicated to meeting rooms as well as a cafe, nearby shops, and an entertainment centre where people can enjoy table tennis and mini-golf. There are also plans to open a restaurant on the top floor this year.
One of the project’s greatest draws, however, is its emphasis on sustainable operations.
Both Worc@Q2 and Melinh Point in Ho Chi Minh City and Eco Logistics Centre in Binh Duong – have received Leadership in Energy and Environmental Design (LEED) certifications by the non-profit U.S. Green Building Council. This is in line with the Group’s goal to have 100% by GFA of new development projects, and 85% of our owned and asset-managed properties, be either green-certified or pursuing green certification by 2030.
“Sustainability is a unique selling point for our project. In the market, especially in industrial, there are not that many projects committed to green certification like ours,” noted Hong Anh, who has since expanded her portfolio as Frasers Property Vietnam’s Head of Commercial and Industrial Leasing.
Tenants are encouraged to do their part. At Melinh Point, a boutique office building which received the prestigious LEED Platinum certification – as well as the Green Mark Platinum rating from Singapore’s Building and Construction Authority (BCA) – tenants are invited to join a 'Green Committee'.
The Committee provides a platform to collectively steward sustainable practices. These include sharing ideas and finding ways to reduce or improve energy consumption as part of ongoing building operations. They also come together to organise fun and engaging activities to raise sustainability values amongst occupiers. Activities include terrarium workshops and a photo contest encouraging tenants to bring their own food containers and bottles to work.
Room to grow
The diverse scope of work at Frasers Property and its rapid growth appeal greatly to Hong Anh, who joined the company in 2020 after seven years in real estate agencies.
“There are a lot of opportunities to grow. I learnt a lot of new things I had never dealt with before,” she said.
In the early days, she was mainly in charge of Melinh Point, where she managed the tenant experience, including the receptionist and customer service teams.
The team introduced energy-saving assets that included LED lightings, high-performance HVAC and chiller upgrades, as well as other systems such as card access and an efficient parking system when the decades-old building completed an asset enhancement initiative in 2020.
The biggest achievement for Melinh Point, she said, was changing the public perception of it as “an old, ageing building”. “It’s now recognised as a Grade A building, and a good example for other developers considering renovating their buildings.”
Located in Thao Dien Ward within the heart of District 2, serviced office tower Worc@Q2 is a recipient of LEED Gold certification.
Melinh Point is the first operating and non-residential building in Vietnam to attain the Green Mark Platinum Certification from Singapore's Building and Construction Authority. It is also a recipient of the prestigious LEED Platinum certification.
Bigger industrial footprint
The journey of growth continues for Hong Anh, whose remit expanded two years ago to cover industrial leasing.
This comes as Frasers Property Vietnam sets its sights on widening its industrial footprint, taking full advantage of the growing appetite for foreign investment in Vietnam. The country attracted more than US$2.36 billion in foreign direct investment as of January 2024 – up about 40 per cent from the same period in 2023.
Frasers Property Vietnam and SP Group signed a memorandum of understanding in 2023 to jointly develop green industrial parks in Vietnam.
Binh Duong Industrial Park – a 75 ha masterplanned development an hour away from Ho Chi Minh City’s central business district – was launched in 2021 and is Frasers Property’s first industrial foray in Vietnam. More industrial facilities are now also being developed in North Vietnam as the country continues to attract multinational companies to set up operations.
The big difference between industrial and commercial tenants, said Hong Anh, is that the industrial tenants need more support with the necessary paperwork.
“The market for commercial leasing is mature, and the tenant and agent know what to do. Meanwhile on the industrial front, foreign investors in particular would need to complete additional paperwork for permits and certificates before they are allowed to enter into a leasing contract,” she noted.
Binh Duong Industrial Park offers our first premium estate concept for an industrial park in Vietnam and has attracted leading national enterprises and foreign direct investments.
Located alongside My Phuoc - Tan Van Expressway and 10-minutes away from Binh Duong Administrative Centre, Eco Logistics Centre is a versatile, multi-tenanted logistics facility comprising eight warehouse spaces each ranging from 3,000 to 10,000 sqm.
“We are also dealing more with the macro environment. We need to know which industries are emerging, and which countries are now focusing more on overseas investments,” added Hong Anh, who is working hard to help Frasers Property secure more industrial tenants.
“In terms of quality and service, we are confident we are among the top in real estate. In terms of size, over the next three to five years, we are aiming to move into the top three.”
Keen to realise your full potential with a differentiated career in real estate, alongside the likes of Hong Anh and her team? Find career opportunities here.