In the context of Vietnam's economy being on a growth trajectory and deeply integrating into the global supply chain, industrial real estate in the North is becoming an attractive sector with numerous investment opportunities…
Cushman & Wakefield believe that, compared to Indonesia, Malaysia, and the Philippines, the price of industrial land in Vietnam is still relatively low. Along with other factors such as a stable macroeconomic situation, low inflation, and advantages in infrastructure and transportation, Vietnam therefore has the potential to become a leading industrial center in the region.
Vietnam’s logistics sector has been developing strongly, leading to high demand for logistics real estate. Timely solutions are needed, however, as supply is limited. According to a report on the emerging market logistics index, published by Agility, Vietnam currently ranks 11th among emerging countries and 4th in ASEAN.
Data from CBRE Vietnam on four cities and provinces considered key industrial centers in the south and Mekong Delta - Ho Chi Minh City and Dong Nai, Binh Duong, and Long An provinces - shows that industrial land rentals have increased 8-13 per cent over the course of the last year. The highest price was $300 per sq m per rental cycle.
The Vietnamese Government is always willing to assist foreign investors seeking to invest in the country’s industrial real estate. With over 394 industrial parks, Vietnam has an abundant supply of industrial land funds compared to other countries in the region. It also actively restructures industrial parks into eco-industrial parks, thus attracting more investors.
The Covid-19 pandemic has certainly caused industrial real estate to wobble at times, but with support coming from the government the market holds a great deal of potential. Vietnam is also aiming to increase clean technology and low carbon production, so will establish many eco-industrial parks in the future.
