Transit-Oriented Development (TOD) should not be viewed simply as a catalyst for rising land values around transit stations. Its broader purpose is to improve accessibility, use urban land more efficiently, and strengthen productivity. Ngoc Le, Senior Director and Head of Strategic Consulting at Cushman & Wakefield Vietnam, explains what this means for Ho Chi Minh City.
HCMC’s Metro Line 1 began operations.
From an investor’s perspective, what role does TOD currently play in site selection for new developments in Ho Chi Minh City?
Since HCMC’s Metro Line 1 began operations, projects along the corridor have recorded clear benefits. Residential prices and transaction activity have increased, while shopping centres have attracted stronger footfall and improved occupancy. These outcomes are beginning to reshape how investors assess development opportunities.
Investment decisions were once driven primarily by geographical location. Today, connectivity and travel time are becoming equally important. Distance is no longer measured solely in kilometres, but also in the number of minutes needed to reach employment hubs, commercial districts and essential services.
As centrally located land becomes increasingly scarce and private vehicle ownership more expensive, access to high-quality public transport is emerging as an important competitive advantage. TOD is therefore evolving from a value-added feature into a strategic investment criterion that can support long-term demand and asset resilience.
Which property sectors stand to benefit most as HCMC’s metro network expands?
All property sectors are likely to benefit, although the scale and timing of those benefits will vary.
Retail is expected to be among the earliest beneficiaries, particularly around interchange, central and terminal stations. Increased pedestrian traffic can support consumer spending, attract retailers and improve occupancy. Residential developments should also see stronger owner-occupier and rental demand as commuting times decline. This will be particularly attractive to young professionals, families and urban workers seeking more affordable, greener living environments outside the city centre without sacrificing access to employment. Office properties may benefit as well, although a metro station alone is not enough to create a successful office cluster. The surrounding area must also offer a critical mass of businesses, services and talent. Office demand is therefore likely to strengthen most significantly around major interchanges and TOD districts planned as emerging employment centres. Hotels may also achieve stronger occupancy as visitors gain easier access to accommodation and key urban destinations.
How has TOD reshaped central business districts in other cities? Is HCMC beginning to experience a similar shift?
In cities such as Tokyo, Hong Kong, Singapore and Seoul, metro networks have supported a polycentric urban model in which multiple business districts emerge along transit corridors rather than all economic activity being concentrated in one traditional CBD.
Under this model, the established CBD remains the primary centre for finance, administration and premium services. However, some demand for offices, retail, housing and entertainment gradually shifts towards well-connected urban clusters. This helps relieve pressure on the traditional urban core while creating new engines of economic growth. The trend is most evident in locations offering three conditions: sufficient land for redevelopment, strong multimodal connectivity and a diverse mix of land uses capable of attracting residents, businesses and visitors. HCMC appears to be at an early stage of this transition. District 1 remains the city’s dominant CBD, but areas along Metro Line 1—including Thao Dien, An Phu, the High-Tech Park and the Vietnam National University precinct—could develop into new employment, commercial and service centres.
Metro networks in Ho Chi Minh City.
What conditions are needed for a TOD district to attract businesses, jobs and new economic activity?
First, land-use planning must be sufficiently diverse. A TOD district dominated by residential development will struggle to generate sustainable employment and economic activity. It needs a balanced mix of housing, offices, retail, hospitality, healthcare, education, public services, green spaces and community amenities.
Second, the district must be genuinely walkable. Residents should be able to move safely and comfortably between transit stations and their homes, workplaces, schools, shops and public spaces. If commuters still depend on motorcycles or cars for the last mile, the model’s effectiveness will be significantly reduced.
Third, density must be high enough to create the critical mass needed to support businesses and services, but it must also be carefully managed. Higher density should be accompanied by adequate technical and social infrastructure, public spaces and effective urban management. Otherwise, it can add pressure rather than address existing urban challenges. Fourth, transparent land-development and redevelopment mechanisms are essential. TOD projects often involve multiple landowners, established communities and complex urban restructuring. Without clear frameworks for compensation, public-private partnerships and value sharing, investors may hesitate to make long-term commitments. Finally, every TOD district needs a clearly defined economic role. Businesses do not choose locations solely because they are served by metro lines. They also consider access to workers and customers, operating costs, infrastructure, supporting services and market positioning. Depending on local strengths, a TOD district could become a hub for finance, technology, education, healthcare, retail, urban logistics or tourism.
If you could choose only one metric to evaluate a TOD district after ten years, what would it be?
I would choose the concentration of residents and jobs within the district.
Unlike property prices, this provides a clearer indication of how well the district is functioning. Land values may rise because of speculation, market expectations or supply constraints, but that does not necessarily mean the TOD model has succeeded. When people choose to live in the area, businesses establish offices, shops and service facilities there, and workers regularly travel to it by public transport, the district has become a genuine centre of economic activity.
What is the most common misconception about TOD in Vietnam today?
The most common misconception is that TOD simply means developing real estate near a metro station.
Proximity to transit is only the starting point. True TOD is an integrated urban-development model in which public transport forms the organising core for living, working, shopping, services and community life. A project should not be considered TOD if it lacks pedestrian connections, feeder transport, mixed-use functions, public amenities or appropriate density. In that case, it is merely benefiting from nearby transport infrastructure rather than applying TOD principles.
