Vietnam Maintains Fit Out Cost Advantage Amid Stronger Office Demand and Rising Focus on Workplace Quality

• Contractor Sentiment Survey shows 70% of respondents expect improved market conditions in 2026

• Vietnam remains a cost-competitive fit out market, with Hanoi and Ho Chi Minh City among the region’s lower-cost cities

• Shorter lead times and efficient delivery continue to strengthen Vietnam’s appeal to occupiers

Ho Chi Minh city, 25 March, 2026 – Cushman & Wakefield’s Asia Pacific Office Fit Out Cost Guide 2026 highlights a clear shift in regional market dynamics, with sentiment strengthening and activity levels improving across several key markets. Contractor confidence has risen year-on-year, with 70% of the respondents to the firm’s annual Contractor Sentiment Survey anticipating improved conditions in 2026. This positive sentiment is further supported by the stronger‑than‑expected 990 million square meters of office absorption in 2025 and a tightening construction pipeline outside India.

Of the 180 survey respondents, nearly two thirds reported project backlogs of around six months, reflecting improving project delivery conditions across the region. While Japan and Indonesia remain outliers with longer backlogs, most markets expect stabilisation or slight improvement in delivery timelines in 2026. This alignment between contractor sentiment and strengthening occupier demand points to a more balanced and active project environment emerging across Asia Pacific.

Tom Gibson, President - Project & Development Services and Sustainability, APAC & EMEA said:

“Across Asia Pacific, fit out and project delivery conditions are improving, with contractors reporting more balanced workloads, strengthening pipelines and better visibility over labour and materials availability. As construction pipelines tighten in several major cities, competition for high quality space will intensify, making early planning and disciplined project execution even more critical. These shifts are prompting organisations to restart workplace upgrades and portfolio transformation efforts. Looking ahead, we expect growing demand for high quality, experience-led fit outs as occupiers prioritise more efficient, future ready workplaces across the region.”

Fit Out Cost Movements (YoY, 2025 → 2026)

The 2026 Guide reported a divergence in city level fit out costs (measured in USD per sqm) across the region:

• Costs rising: Japan and Taipei posted the largest year-on-year increases
  (Tokyo: USD 2,314 vs USD 2,099; Taipei: USD 1,561 vs USD 1,184)
• Costs easing: Mainland China and South Korea saw declines
  (Shenzhen: USD 936 vs USD 1,012; Seoul: USD 1,399 vs USD 1,679)
• Costs steady: Singapore (USD 1,507) and Hong Kong (USD 1,722) remained largely unchanged
• Best value: India remains the region’s most cost competitive market, with most major cities ranging USD 700– 786 per sqm

Table: Ranking of Average Fit Out Costs In 33 Cities Across Asia Pacific

These cost movements reflect evolving local construction dynamics and broader economic adjustments influencing material, labour and delivery markets across Asia Pacific.

APAC Office Market Dynamics

Even as office demand across APAC surged in 2025, Cushman & Wakefield also noted a substantial contraction in new office supply outside India. Development pipelines have moderated sharply due to rising construction costs and reduced project feasibility, intensifying competition for prime space. As supply tightens, vacancy rates in high quality buildings - particularly in core CBD locations - are expected to trend lower, reinforcing the ongoing flight to quality amongst occupiers.

Report author and Head of International Research, APAC & EMEA, Dr Dominic Brown said:

“After a resilient 2025, the Asia Pacific office market is now transitioning into a more stable phase, supported by a gradual return of business confidence. Coupled with the tightening supply pipeline outside India, which is reshaping the competitive landscape for high quality space, these collective shifts indicate a meaningful turning point for the region in 2026, with both occupiers and investors positioned for renewed momentum.”

Against this regional backdrop, Vietnam continues to stand out for both cost competitiveness and delivery efficiency. At USD 678 per sqm in Hanoi and USD 657 per sqm in Ho Chi Minh City, both markets are among the lower-cost cities covered in the guide. According to the report, Vietnam is also one of the few markets in Asia Pacific with execution and lead times noticeably below the regional average, supporting occupiers seeking greater certainty around project delivery. While labour costs continue to be a source of pricing pressure, occupiers are also monitoring imported material and logistics costs more closely amid ongoing geopolitical uncertainty, even as workplace quality, sustainability and long-term operational value remain key priorities.

“All-in” Fit Out Costs in Southeast Asia

Hung Huynh, Head of Project & Development Services, Vietnam, Cushman & Wakefield, said:

“Vietnam continues to offer occupiers a compelling fit out environment, combining competitive costs with relatively efficient delivery timelines. At the same time, clients are becoming more selective about how they invest, with growing attention on workplace quality, ESG outcomes and long-term operational value. In the current environment, the most effective fit out strategies are those that balance ambition with practicality, particularly through local sourcing, early planning around imported items and selective reuse where appropriate.”

Notes:

1. Data and pricing benchmarks in the guide reflect market conditions as of December 2025. For insights on the Middle East conflict, please refer to Cushman & Wakefield’s Middle East Conflict: Implications for Energy, Inflation, and CRE.
2. Cushman & Wakefield publishes Office Fit Out Cost Guides for APAC, EMEA and the Americas, which are all available here.