Illustrative image (Source: VNA)2021 is forecast to be another bumper year for the sub-sector, withVietnam continuing to scoop up global manufacturing relocations, and industrialdevelopers with large land banks are looking forward to an even brighterfuture, according to the latest report from real estate consultants SavillsVietnam.
The report stated that average occupancy rates have increasedsignificantly since 2018. In the north, average occupancies last year were upto 90 percent in Hanoi, 95 percent in Bac Ninh, 89 percent in Hung Yen, and 73percent in Hai Phong. The rate in Ho Chi Minh City was 88 percent, Binh Duong 99percent, Dong Nai 94 percent, Long An 84 percent, and Ba Ria-Vung Tau 79percent.
Vietnam now has about 260 operational IPs and 75 others underconstruction. The national occupancy rate averages over 70 percent.
The sudden increase in rental enquires for land, ready-built factories,and warehousing has been accompanied by price escalations in IPs near majorcities. In the north, prices in Hanoi of 129 USD per sq m were up 13.1 percentyear-on-year, of 95 USD in Bac Ninh were up 9.2 percent, of 83 USD in Hung Yen wereup 6.4 percent, and of 96 USD in Hai Phong were up 3.2 percent.
In 2020, HCM City saw rental prices of 147 USD per sq m, while in othersouthern industrial areas, the price in Binh Duong of 107 USD per sq m was up4.9 percent year-on-year, of 98 USD in Dong Nai was up 6.5 percent, and of 65USD in Ba Ria-Vung Tau was up 18.1 percent.
Rising demand for industrial properties gave a major push to overallperformance by developers. The Kinh Bac City Development Holding Corp (KBC)reported revenue in excess of 2 trillion VND (87 million USD) in the firstquarter of 2021, almost quadrupling the figure in the same period last year. Ofthis, over 1.9 trillion VND came from land rentals and property transfers, a three-foldincrease year-on-year.
The Sonadezi Corporation’s revenue rose 14 percent from January-March toover 1.26 trillion VND, with more than 365 billion VND from industrial realestate, Savills said, adding that other developers such as the Tan Tao Group(ITA), the Becamex Infrastructure Development JSC (IJC), and the Nam Tan UyenJSC (NTC) also saw high growth in profit during the period.
Vietnam has been drawing up plans since last year for the heavy investmentbeing channelled into developing infrastructure and industrial parks to attractmore companies in supply chains. Various incentives, including corporate taxexemptions, have been adopted to acquire a competitive advantage over rivals inthe region./.
VNA
