Skyscrapers are popping up at a fast pace in major cities in Vietnam. Height records are constantly being set and broken. This is definitely a good sign for those in the real estate industry. What does it mean for everyone else in the country?
Late last year, Saigon saw a major cityscape makeover with the opening of the Bitexco Financial Tower, the tallest building in the country at the time. The 861 ft tower is beautifully designed and inspired by the elegance of a lotus. Only a few months later, the Keangnam Hanoi Landmark Tower closely surpassed with 70 floors. The race doesn’t stop there. Already under construction or approved by the government are a slew of other high rise buildings including the Saigon Lotte Tower (111 floors), PVN Tower (102 floors), and the Lotte Center Hanoi (65 floors). The Saigon Lotte Tower once completed will be higher than the Willis Tower in Chicago, currently the highest in the US.
It is important to point out that up till very recently buildings of 30 storeys or above are very rare in Vietnam. However, in the past 3 years, 18 of them mushroomed all over the countries, mainly in Hanoi and Saigon. The trend is only picking up with about 50 projects in the pipeline or already under construction. Vietnam’s metropolitan landscape is fast transforming.
Skyscrapers are being built based on demand for commercial and residential real estate. Their proliferation, therefore, reflects well on the country’s economic development. Vietnam seems to follow the height race that started earlier in Thailand, Malaysia or China. This is quite a natural development phase since Vietnam also has very high population density.
However, the recent boom in skyscrapers has put noticeable pressure on urban transport systems. City centers now accommodate many more businesses and people. According to CBRE Vietnam, a leading real estate developer, Ho Chi Minh City will add 13 million square feet only in office space in the next 3 years. Most of this will be in the city center. Higher density in downtown areas will only make the current traffic problems worse.
The fast pace of high rise construction is in sharp contrast to the low level of transport infrastructure development. According to a report from the International Traffic and Land Transport Conference and Exhibition, only a quarter of the road network in Vietnam has more than one lane. Every year, the traffic volume increases 13% while relatively little road area is added. While skyscrapers are popping up everywhere, it is also getting harder to access offices and businesses in those buildings.
In the next few years, cityscapes of major cities in Vietnam will look so much more developed, just don’t look closely at the crazy traffic on the ground level.
Sources: CBRE Vietnam, Viet Traffic (International Traffic and Land Transport Conference and Exhibition 2011).