Optimistic investment sentiment in the field of industrial property

The logistics sector has seen a number of large-scale investments in the first few months of the year as it experiences a period of significant growth which is vital to the ongoing development of the country’s economic recovery.

Many real estate developers are looking for industrial land for quality warehouses and more, Photo: Le Toan

This week, Kenneth Gaw, chairman and co-founder of global private real estate investment firm Gaw Capital Partners, will be one of the most high-profile foreign investors to visit Vietnam as the country attempts a full reopening of the pandemic.

Although Gaw Capital Partners’ portfolios range from high-end residential to hospitality, on March 9 in Ho Chi Minh City, Gaw was set to choose the industrial real estate angle to share his vision for the fund with a series of local partners who will jointly develop Gaw’s factory and logistics system in Vietnam.

Gaw NP Industrial in Vietnam is an industrial platform of Gaw NP Capital, with $200 million backed by Gaw Capital Partners and NP Capital Partners.

Gaw NP Industrial has two developments in Vietnam so far in the form of GNP Yen Binh Industrial Centers I and II, located in Thai Nguyen Province, with further developers in the pipeline.

During the first two months of the year, the industrial real estate and logistics segment revealed significant foreign investment with major projects announced.

Just after the announcement of the establishment of GLP Vietnam Development Partners I, with an investment capacity of approximately $1.1 billion in the development of modern and environmentally friendly logistics facilities in Vietnam, its joint- A strategic venture between GLP and SEA Logistic Partners (SLP) began construction of SLP Park Xuyen A in Duc Hoa district of Long An province last month.

This is SLP’s third project in Vietnam after others in the northern port city of Haiphong and the southern province of Long An.

CapitaLand Development (CLD), the development arm of CapitaLand Group, with portfolios of 35 properties in the Vietnamese real estate market to date, has also expanded its footprint in the industrial property market through a memorandum of understanding with the Committee popular Bac Giang valued at over a billion dollars. . The MoU outlines the mutual interest of CLD and provincial authorities in developing its first industrial park, logistics park and township development in Vietnam.

Meanwhile, BW Industrial Development JSC, Vietnam’s leading industrial and new real estate developer co-founded by Warburg Pincus and Becamex IDC, announced in January the acquisition of approximately 74,000 square meters of prime land in the industrial zone ( IZ) from Bac Tien Phong in northern Quang Ninh province, developed by DEEP C IZs.

Speaking to VIR, Matthew Lourey, Managing Partner of Acclime Vietnam, said that logistics represents an important part of the supply chain, underpinning manufacturing and consumption in Vietnam.

“From consumer-focused distribution centers and cold chain storage and handling to just-in-time delivery of inventory to factories, a flexible and expanding logistics sector remains at the heart of the economy,” he said. -he declares.

“Foreign investors, who control nearly 75% of Vietnamese exports, are keenly interested in how logistics interacts with their businesses and that as production technologies evolve, the logistics industry must progress. and change. Along with changing consumer habits and the use of technology, opportunities have been created for foreign investors in the logistics sector,” Lourey said.

According to Graeme Torre, Managing Director and Head of Asia-Pacific Real Estate at APG Asset Management, with the ongoing changes in the global supply chain to Vietnam, the country’s logistics is seen as an attractive opportunity for investors in the region. region.

Dutch pension fund manager APG was a new investor who participated in the establishment of GLP Vietnam Development Partners I in February.

“Vietnam’s logistics market complements our existing regional logistics exposure very well, while also offering very strong risk-adjusted returns that will benefit our pension fund clients and their participants. With GLP’s extensive global experience, credentials and expertise in the logistics industry, we are thrilled to partner with them in this endeavor for our first foray into Vietnam,” said Torre.

In 2022, the consultants cited that warehouses and logistics continue to attract investor interest.

According to JLL, the market expects to accommodate many warehouse projects such as phase 1 of a business developed by Boustead and KTG in Yen Phong II-C with an area of ​​8.1 ha; and BW Industrial Phase 3 at VSIP Hai Duong with an area of ​​10.4 ha.

“Due to the strong demand from domestic and foreign enterprises, many real estate developers pay attention to industrial land to build high-quality warehouses and factories, not only in provinces and cities in the northern regional key economic zone, but also in neighboring localities,” the JLL report said.

In the south of the country, Long An, Ho Chi Minh City and Binh Duong are still among the top five in the country in terms of attracting investment. In 2022, pharmaceuticals, medical devices and data centers are expected to be the new market growth drivers. IZ and warehouse investors have also started paying attention to the sustainability trend, with new factories meeting green standards being developed and built.

IZ real estate appraisers will keep the heat going again this year. SSI Research estimates that IZ land prices in Vietnam will increase by 8-9% in the south and 6-7% in the north by 2022. SSI expects demand for land rental in IZ recovers when the contracts signed last year are completed this year. year.

Promoting public investment in infrastructure will also support industrial real estate. Vietnam’s IOI land supply is expanded to nearly 45,000 ha by 2025, mainly located in the Red River Delta, North Central Coast and Central Coast regions.

Source: VIR

The price of industrial land is soaring

The price of industrial land is soaring

Binh Duong and Long An provinces are still active markets in the south, with land prices and rents soaring, while the northern industrial areas are also attractive.