Shophouses, also known as commercial shophouses or units, first appeared in the 19th century in many Southeast Asian countries like Singapore, Viet Nam, and Malaysia. Shophouses were originally designed to be mixed-use properties with a shop (which opened onto the pavement) and a residence for the owner. While this has changed over the years, particularly for newly built shophouses in Viet Nam, shophouses still serve as commercial properties with street frontage. 

Nowadays, shophouses are usually on the ground floor, the lower floors of townhouse or apartment projects, or they can be stand-alone properties. Usually, shophouses are only two or three levels high, they sit next to one another, and they have road frontage. Today shophouses offer investors attractive investment opportunities as they can be rented out and usually offer attractive rental yields. For example, Hamptons Mall, a coastal shophouse project, expects rental yields of between 6.2% and 28.5%.

As the name implies, shophouses are usually in multifunctional areas with commercial, residential, and business use. Shophouse tenants include commercial customers like convenience stores, F&B tenants like coffee shops, or retail stores like clothing boutiques. Some private businesses, like lawyers, accountants, medical practitioners, or beauty salons like using shophouses too.

Shophouses play an interesting role as they offer alternative commercial space for private businesses, which is attractive considering the rising office rents and limited commercial vacancy, especially in the CBD. With prices in the CBD rising and limited availability (even for shophouses), areas like Thu Thiem are appealing to both investors and tenants who want good proximity and connectivity to the CBD without the high prices.

Shophouses in coastal areas like Ho Tram are proving to be lucrative investment channels too, with average rental yields of approximately 12%. According to Savills Hotels APAC, shophouse products in the main coastal markets had an impressive growth rate of 149% between 2015-2020, nearly three times higher than the growth rate of the second home sector, which had a 52% increase in the same period. With good proximity to HCMC and a good supply of tourists from resorts and villas in the area, Ho Tram is a coastal area with huge potential. As vaccine rollouts continue and tourism recovers, shophouses in Ho Tram are likely to remain a popular investment.

Read further: Ho Tram Primed for Coastal Second Homes

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