The industrial real estate sector will likely continue to pick up in the remaining months of the year thanks to the ongoing global supply chain disruption and diversification, and the trade deals that Vietnam has signed, experts said.

Energy price uncertainty due to geopolitical issues and concerns on economic growth, China’s persistence in pursuing a zero COVID-19 policy coupled with a global trade slowdown have been fueling the disruption and diversification, they added.

In Vietnam, industrial real estate leasing has seen a hike in demand and rental prices, especially for logistics and warehousing.

Vietnam Singapore Industrial Park (VSIP) in Binh Duong (Park 1)

According to CBRE Vietnam, a commercial real estate services and investment firm, in the third quarter, its industrial leasing enquiries are improving in both quantity and sizes. Land acquisition enjoyed 10 per cent year-on-year growth so far this year and 7 per cent growth for ready-built factories/warehouses.

The average size required by tenants of all CBRE’s enquiries was 9.4 ha in the first half of 2022 compared to 9.2 ha last year for land and 6,700 sqm in the first half compared with 6,100 sqm in 2021 for ready-built factories/warehouses.

Vietnam continues to be an appealing destination for industrial real estate investors, according to global real estate services firm Cushman and Wakefield.

It attributed this to the country’s stable growth rate, an export-oriented economy, a rise in free trade agreements, a young labour force, investment incentives and strategic location.

With favourable government incentives, competitive labour costs, a stable political environment, a positive economic outlook and free trade agreements, the Southeast Asian country has become popular for foreign investors moving out of China.

Source: Vietnam News Agency