Is Industrial park real estate in difficulty?
Before the outbreak of the 4th Covid-19 wave, Vietnam was considered as one of the countries with good disease control, the industrial real estate segment was in the sights of many foreign investors. However, recently two phenomena have slowed down this situation.
Those are industrial zones with a large number of infections such as in Binh Duong, Bac Giang and Bac Ninh. In Ho Chi Minh City and industrial zones near Ho Chi Minh City are also being severely affected.
That has affected the psychology of industrial real estate investors in particular and the market in general.
The next 1-2 years, it is possible that some investors in China and other countries are planning to relocate their production factories to Vietnam.
Industrial real estate in the past was also very different from industrial real estate 10-15 years ago. If in the past, investors in industrial real estate only made infrastructure, then they waited for investors to rent factories, and investors had to build factories themselves.
But now, the form of industrial real estate business in Vietnam has changed, investors can also build ready-made warehouses and factories and then rent them out.
Although there are available land, factory supply tends to decrease in big cities such as Ho Chi Minh city and Ha Noi. Trend is moving to nearby provinces.
Land cost and factory rental fee completely in the contrast with land supply. It is no doubt to conclude infrastructure of factory trending to nearby provinces to create a net of satellite cities.
With its resilience during the pandemic, the industrial sector in Vietnam became an attractive opportunity for both international and local players. In 2020, despite the pandemic, international warehousing giants such as GLP, LOGOS, and JD.com entered and heavily invested in both Northern and Southern of Vietnam. Vingroup, a major local real estate developer.
SUM UP
Although the market will still face restrictions on travel, limited flights, making foreign investment in Vietnam's industrial real estate have certain limitations. In the industrial real estate market, the interest of domestic and foreign investors in Vietnam is still present.