HCMC – Land rents at industrial parks in southern Vietnam were US$120 per square meter on average in the first quarter of the year, up 9% year-on-year, according to property consulting firm Jones Lang LaSalle (JLL).
In a report on the industrial real estate market, JLL attributed the land rent hike to a new wave of foreign direct investment into Vietnam after the country reopened its economy and enterprises showed a higher demand for expansion, news site VnExpress reported.
Meanwhile, real estate service provider Colliers Vietnam said the average industrial land rent in HCMC alone reached US$190 per square meter and the occupancy rate hit 90% in the January-March period.
Land rents in the industrial parks in the southern part of the country has grown 8%-9% per year over the past few years.
Many industrial parks in HCMC have run out of land for lease, paving the way for neighboring provinces such as Binh Duong, Long An and Dong Nai to attract more investors.
Warehouses, workshops and logistics services have high growth potential this year thanks to the fast growth of e-commerce in large cities, according to Colliers Vietnam.
In addition, a report on the highlights of Vietnam’s industry revealed that industrial parks reported the most positive growth in the real estate market during the Covid-19 pandemic, with rents and occupancy rates leaping in the first quarter.
John Campbell, associate director of industrial services at Savills Vietnam, said after Vietnam reopened international air services, investors could travel to Vietnam to see projects, sign contracts, establish manufacturing facilities and file for investment certificates, which has fueled the demand of industrial land, warehouses and workshops.
The Vietnamese Government has been encouraging companies, especially those with products of high added value, to move to the country and provide tax incentives for technology, R&D, renewable energy and smart agriculture firms, Campbell said, adding that the move has fostered the growth of the industrial real estate sector.
The sector has great opportunities for growth from 2022 onward, he noted.