Illustrative image (Photo: VNA)
HCM City (VNA) – Demand for industrial real estate is growing on the back of Vietnam’s entry to international and regional trade agreements, according to the CBRE Vietnam Market Outlook released on February 22.
Ready-built-factory rents in Ho Chi Minh City continue to hike thanks to rising demand from retailers and fast moving consumer goods companies. However, there was no new supply recorded in 2015, mostly due to limited space and stricter project approval from the local administration.
In the southern province of Binh Duong, authorities actively sought for investors to fill excess supply of industrial space. Vacancy rate in this province is expected to fluctuate around 30 percent over the next three years.
Infrastructure improvement is a key supply driver in Dong Nai, with two major projects, including the recently-completed Long Thanh – Dau Giay highway and the upcoming Long Thanh international airport, which will be finished in 2020. As a result, rents will be stable for the next three years as landlords offer competitive prices to improve occupancy rates.
On the other hand, despite its low labour costs and proximity to Ho Chi Minh City, Long An is failing to attract investors because of its unfinished infrastructure and high rents and thus its vacancy rate will remain high at around 60 percent for the next few years.
According to the CBRE experts, the industrial real estate market is expected to be busy, as more multinational corporations expand their operations in Vietnam to tap the Trans-Pacific Partnership and other trade benefits, as well as the emergence of e-commerce.-VNA
