Illustrative photo (Photo: bnews.vn)

Hanoi (VNA) - Real estate attracted the second largest volume of foreign direct investment with 34 new projects worth 1 billion USD in the first nine months of this year, or 6.1 percent of the total, according to the Ministry of Planning and Investment’s Overseas Investment Agency. 

Nguyen Hoai An, CBRE Vietnam Director of Research, Consulting and Asset Management Services, said Vietnam had been extremely attractive to Asian investors over the last decade, especially those from Japan, the Republic of Korea and Singapore. 

These investors consider market potential, penetration opportunity and capital safety when deciding to invest in any overseas property market, she said. 

Japanese investors have shifted their interest from industrial properties to housing and offices over the past two years. They tend to buy up existing projects or start new ones from scratch, she added. 

Another perspective came from real estate services provider Savills Vietnam, which said it was not just residential housing and commercial office buildings that had picked up. 

Industrial real estate had also become valuable, it said, pointing out that rising labour costs in China was putting pressure on labour-intensive industries like garment, footwear and mechanical engineering. 

As a result, foreign firms seeking better manufacturing conditions, especially in labour costs, were leaving the country. 

Vietnam was emerging as a bright spot for this investment thanks to its waterway and road connectivity with China, it said.

The country’s membership in ASEAN and a number of free trade agreements has attracted a surging amount of FDI, especially since the conclusion of negotiations on the Trans-Pacific Partnership and the EU-Vietnam Free Trade Agreement in late 2015, it added.-VNA