Stores disappear from Hanoi's shopping districts -- e-commerce boom drives a structural shift to 'vacant prime locations'

Stores are disappearing from Hanoi's shopping districts. More than 30 vacancies have appeared on prime streets such as Thai Ha, Kim Ma, and Nguyen Thai Hoc, once lined with fashion and dining outlets. Even with rents cut by up to 37%, no tenants are stepping in. The rapid growth of e-commerce and the rise of large shopping malls are structurally reshaping Vietnam's retail real estate.

What's happening in Hanoi's shopping districts

More than 30 vacancies, rents down 13-37%

On Kim Ma and Nguyen Thai Hoc streets alone, at least 30 units are vacant. The average asking rent for townhouse-style storefronts has fallen 13-37% from its 2025 peak. According to data from the real estate portal Batdongsan, interest in residential housing in Hanoi has also declined 22% since the end of 2025.

The case of Thai Hoang: monthly sales fell below rent

Thai Hoang, 39, ran a men's clothing store measuring 40 square meters with a 5-meter frontage on Thai Ha Street. The monthly rent was VND 35 million (approx. JPY 210,000). The landlord offered a 6% discount, but Thai Hoang chose to close up, saying 'there were months when sales didn't even cover the rent,' and shifted the inventory to online sales.

Three drivers of the structural shift

1. Rapid growth of the e-commerce market

Vietnam's e-commerce market continues to expand at a pace of more than 20% a year. Shopee strengthens its Meta affiliate program and competition among platforms is also intensifying. Consumers are accelerating 'showrooming' behavior, trying items on in physical stores and then buying online.

2. The rise of large integrated malls

Mai Vo of CBRE Vietnam points out that 'consumer habits have changed significantly with the rise of e-commerce and integrated shopping malls.' The 'brand experience' function once expected of street-front stores has shifted to air-conditioned malls with parking.

3. Regulation and aging properties

In addition to stricter crackdowns on sidewalk vending, townhouse-style properties are increasingly aging, making it harder to maintain brand image. Because these are structural issues, an economic recovery alone will not fill the vacancies.

Market changes in data

Trends in rent and interest levels

Growth of Vietnam's e-commerce market

Vietnam's e-commerce market reached approximately USD 25 billion in 2025, ranking second in Southeast Asia after Indonesia. Grab expands its business through AI adoption and other tech companies' infrastructure investments are further accelerating the shift in consumption away from physical stores.

Local Reaction

Real estate expert views

Mai Vo of CBRE Vietnam declared that this rise in vacancies is 'not a temporary phenomenon but a structural shift in the market.' The advice is to consider repurposing the space (co-working, warehousing, experiential stores) rather than waiting for street-front demand to recover.

Landlords' response

Some landlords are offering 6% discounts, but this falls short of tenants' expectations. Even with rent cuts of more than 30%, there are more cases where the appeal of the location is offset by the property's physical condition.

Tenants shifting course

Like Thai Hoang, one operator after another is switching from physical stores to an online-only model, a decision that cuts fixed costs while expanding customer reach at the same time.

Impact on Japanese companies and those expanding into Vietnam

Rethinking store-opening strategy

Before Japanese companies entering Vietnam with physical stores see lower street-front rents as an opportunity, they need to soberly verify whether a physical store can actually attract customers. Consumer purchasing channels are shifting to e-commerce and malls, and street-front stores are heading toward functioning only as a 'brand experience space.'

Store design premised on e-commerce integration

Momo's expansion into financial services as shown by this indicates that Vietnamese consumers are moving quickly toward digital payments and e-commerce. An omnichannel design that uses physical stores as showrooms while directing purchases to e-commerce is a realistic option.

Ripple Effects on the Industry

Restructuring of the real estate industry

The rise in street-front vacancies reflects a structural change in Vietnam's real estate market. Demand to renovate townhouse-style properties and convert them into co-working spaces or dark stores (instant-delivery warehouses) represents a new investment opportunity.

Rising demand for logistics and warehousing

As e-commerce expands, demand for small urban warehouses and fulfillment centers is surging. Converting vacant street-front stores into warehouses is a rational solution for both owners and e-commerce operators.

Practical Information

Conclusion

The rise in vacancies in Hanoi's shopping districts is evidence that Vietnam's retail market is being reorganized around e-commerce. Falling rents may look like an opportunity at first glance, but since consumers' shopping patterns themselves have changed, traditional street-front openings should be judged carefully. Japanese companies need to approach the Vietnamese market with a store-opening design premised on an omnichannel model of 'physical store = brand experience, purchase = e-commerce.'

Sources: VnExpress International (April 2026)