According to Savills' Real Estate Market Report, in the fourth quarter of 2024, the operations of the serviced apartment segment continued to improve. The total supply of serviced apartments reached 6,346 units in 64 projects, remaining stable quarterly and increasing by 3% annually after Swiss- Belresidences Hanoi came into operation. The filling capacity increased by 2 percentage points quarter-on-quarter and year-on-year to 84%.
Accordingly, higher-quality and service apartments such as Class A and Class B continue to be favored, with higher occupancy rate per quarter, while Class C decreases by 2 percentage points. The average rental price for serviced apartments increased by 1% quarterly and 2% annually. Of which, class C is the only segment that recorded a decrease in rental prices.
The factor leading to the improvement of this segment is assessed to be foreign direct investment capital and demand from industrial parks. Mr. Matthew Powell - Director of Savills Hanoi - commented: "The expansion and development of industrial parks (IPs) in Hanoi along with strong foreign direct investment (FDI) flows have caused the demand for serviced apartments to grow strongly".
Data from the General Statistics Office shows that Vietnam attracted 38.2 billion USD in registered FDI capital in 2024, including 3,375 newly registered projects. Implemented FDI capital reached 25.4 billion USD, up 9% annually and is the highest level recorded to date. Of which, Hanoi has attracted 2.2 billion USD in FDI capital from 293 newly registered projects, an increase of 30% over the same period last year, ranking fifth nationwide after Bac Ninh, Hai Phong, Ho Chi Minh City and Quang Ninh in attracting foreign investment capital.
By November 2024, the planning task of the three new industrial parks (IPs) in Thuong Tin and Soc Son had been approved with a total area of 600 hectares. Including Bac Thuong Tin Industrial Park (137 ha), Phung Hiep Industrial Park (175 ha) and Soc Son Industrial Park (324 ha). 10 operational industrial parks have a total area of 1,300 hectares, of which 9 areas have been filled.
The increase in FDI capital and the number of industrial parks have brought a large number of foreign experts, engineers, and technicians to work and live. On the other hand, according to Mr. Matthew, foreign experts often have certain requirements for quality and services for accommodation. Therefore, the demand for housing options for foreign experts is mainly concentrated in Hanoi to easily access a diverse system of utilities and high-quality supply.
The director of Savills Hanoi also said that currently, the market has also recorded an increase in rental demand, when the demand for housing is large but house prices are anchored at a high level. However, the rental option will mostly be apartments or individual houses, because serviced apartments often have higher accommodation costs.
Regarding the prospects for the supply of serviced apartments, the expert said that from 2025, 17 projects will be launched on the market with 4,077 new apartments. In 2025, 7 projects will provide 2,889 units, of which Tay Ho View Complex is expected to supplement the largest supply of Class A. A project in Tay Ho District is expected to provide 162 units in 2026. The remaining 17% of future supply is in the inner city and the remaining 17% is in the West.
Notably, international operating units continue to be optimistic about the development potential of the market, demonstrated by the fact that these units dominate with 87% of the supply of serviced apartments in the future. Notable units participating in the market include The Ascott, Lotte Group, Parkroyal Serviced Suites Hanoi, Shilla hotels & Resorts, Hilton and Hyatt.
