The New Race
In 2024, Binh Duong Mineral and Construction Corporation (stock code: KSB) will continue to develop key investment areas that are the company’s strengths, including mineral exploitation and industrial real estate. Early in April, the company was granted license number 05/GP-UBND by the Binh Duong provincial government, allowing it to exploit the Tam Lap 3 quarry in Phu Giao district.
Another major investment area for KSB is in the development of industrial park real estate. Currently, KSB is putting phase 2 of the extended Dat Cuoc Industrial Park in Binh Duong into operation. Dat Cuoc Industrial Park covers a total area of 553 hectares in Bac Tan Uyen, 50 kilometers from Ho Chi Minh City, adjacent to the Ring Road 4 and an arterial road, making it highly advantageous for trade. KSB has filled the entire area of phase 1 and phase 2, and is currently developing phase 2 of the expansion.
KSB recently announced the completion of its acquisition of Hoa Lu Industrial Park in Loc Tan and Loc Thanh communes, Loc Ninh district, Binh Phuoc province.
Notably, KSB recently announced the completion of its acquisition of Hoa Lu Industrial Park in Loc Tan and Loc Thanh communes, Loc Ninh district, Binh Phuoc province, with a land use area of over 348 hectares. The total investment of the project is over 1,700 billion VND.
“The acquisition of Hoa Lu Industrial Park demonstrates KSB’s determination to develop our industrial park ecosystem. We believe that the industrial real estate sector will see strong growth in the near future,” said a KSB executive.
In the Long An market, the 500-hectare Prodezi integrated urban industrial service complex has been developed in Ben Luc district. This is a green-oriented integrated urban industrial service complex, and the neighboring LA Home urban area is based on this model.
The project offers a variety of housing types, from townhouses and river view villas to commercial shophouses, meeting the housing needs of thousands of professionals, engineers, senior managers, and workers in Prodezi and neighboring industrial clusters. The investor expects this model not only to contribute to improving the efficiency of land use, but also to support the relocation of residents from the city center.
At the 2023 general meeting of shareholders of Saigon Thuong Tin Real Estate Corporation (TTC Land – stock code: SCR), Mr. Le Quang Vu – Deputy General Director of Thanh Thanh Cong Industrial Zone Corporation and Mr. Pham Trung Kien – Internal Audit Expert of Thanh Thanh Cong Investment Corporation were elected to the Board of Directors to prepare for the company’s expansion into the industrial real estate sector.
According to TTC Land, SCR believes that industrial real estate and logistics have outperformed other types of assets since 2018 due to the development of manufacturing, exports, e-commerce, transportation, and warehousing. Many businesses are considering Vietnam as a new destination to expand production from China in the Southeast Asian region, and it is predicted that the industrial real estate market will grow by at least 2x in the next 10 years.
Perspective of the 500-hectare Prodezi integrated urban industrial service complex in Ben Luc district, Long An province.
The absorption rate of ready-built workshops is expected to continue to increase. The demand for warehouse rental will continue to be sustained by domestic consumption, Vietnam’s export-oriented economy, and the growth of the logistics and e-commerce markets. Industrial real estate and warehousing will be the synergies that enable TTC Land to continue expanding its development.
Ha Do Group Corporation (stock code: HDG) has also proposed to Ninh Thuan province that it invest in two industrial clusters, Phuoc Nam 1 and Phuoc Nam 2, near Ca Na industrial park. Each cluster has an area of 50 hectares and focuses on low-impact, high-tech industries.
Great Potential
Commenting on this trend, Dr. Pham Anh Khoi – Director of the Dat Xanh Services Institute of Real Estate Economics and Finance, believes that industrial real estate is showing signs of growth, with the development of new industrial parks and the participation of new investors, especially in large-scale projects of 100 hectares.
In the meantime, CBRE Vietnam affirms that in the context of market difficulties in the real estate sector, industrial real estate will remain a bright spot this year, with high demand and rising rental prices. In 2023, the industrial real estate sector in the northern region recorded an occupancy rate of over 80%, while in the southern region it was around 92%.
In addition to electronics, automotive, and accessory manufacturers, CBRE notes that tenants from new industries in the high-tech sector, such as electric vehicle manufacturing, semiconductors, and green materials, are also interested in Vietnam. Based on this, CBRE expects that in the next 3 years, industrial land rental prices may increase by 5-9% per year in the north and 3-7% per year in the south. Rental rates for ready-built warehouses and workshops may also increase slightly, by 1-4% per year.
Industrial real estate will remain a bright spot this year, with high demand and rising rental prices.
SSI Research believes that industrial real estate will also have positive prospects due to the continuous growth of FDI inflows into Vietnam this year. In the north, the demand for industrial land leasing may increase this year due to the demand for production relocation from China to Vietnam, mainly in the electronics and semiconductor industries. In the south, industrial parks may recover thanks to tenant groups such as manufacturing enterprises (textiles, wood, leather shoes), logistics, food, and beverages.
Mr. John Campbell – Deputy Director and Head of the Industrial Services Department, Savills Vietnam, believes that the search for industrial land supply is becoming a difficult problem for businesses, as the occupancy rate in industrial parks is always high. In some southern provinces such as Binh Duong and Dong Nai, the occupancy rate is always above 95%.
“The industrial real estate market in Vietnam has great potential for development, with a variety of products such as data centers, cold storage, and logistics. In addition, the service of building workshops to order, to meet special technical requirements, is also attractive to investors,” said Mr. John Campbell.
