Now that it has a fancy new pedestrian promenade, landlords that own buildings along Nguyen Hue Street are hiking rents, putting the hurt on business that are just starting to recover from slow sales during its construction.
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Since the walking street opened in late April, rents on the street have increased by 15 – 20%, reports SGGP.
Nguyen Van Thai rents a 4m wide and 32m long shop on Nguyen Hue and complained that his landlord has hiked the rent to US$12,000 per month, 20% more than he was previously shelling out.
A manager at Sun Wah Group Do Minh Luan told the paper that their current rates of US$33-35 per square meter a month would also be boosted by 20% next year.
Business owners moan about poor sales performance, not only during the lengthy construction period, but also after the street became operational, wrote the paper.
“An electronic shop owner in Nguyen Hue said that when the walking street was under construction, he had to paid VND20 million monthly for a 16 square meter space and fell in unsold conditions for several months due to road works. Some shops nearly closed down without entrance ways.
However right after the street was built and opened, the space price was increased by VND10 million while purchasing power had yet to recover at that time.
Camera shop owner Le Hung said previously he received an average of 300 visitors a day. The number has fallen to only 50 recently. Many customers told they were afraid of parking and walking to shops in the street amid hot weather.”
Luong Thanh Hung, head of Hung Phat Real Estate Exchange in Tan Binh District, said that it isn’t unusual for rents to be raised following road expansions and improvements.
He added that while demand has increased for shops along the pedestrian boulevard, a 20% rent hike is too high.
