In a recent analysis report, Savills said that in the past 20 years, thanks to the stable growth rate, the export-oriented economy, the increase of Free Trade Agreements (FTAs), the force With young workers, preferential investment policies and a strategic geographical location, Vietnam has become one of the production centers that attract the most attention in Asia.

By 2020, the US-China trade war, FTA and the wave of multinational companies' factory relocation out of China have boosted Vietnam's economy along the value chain.

Due to the impact of the COVID-19 epidemic, Vietnam's economy in general faces many challenges. In fact, during the epidemic period, which lasted from April, the business activities of industrial park real estate enterprises were heavily affected and it is highly likely to delay development plans in the short term.

“Industrial developers have not been able to lease out as many properties as expected by foreign investors,” said John Campbell, Head of Department, Industrial Real Estate Services at Savills Vietnam. and tenants cannot directly visit, select and sign industrial real estate lease contracts.However, in 2021 there will be a large supply of industrial real estate due to the introduction of new industrial parks and projects. extended project".

Due to the impact of the COVID-19 epidemic, Vietnam's economy in general faces many challenges. In fact, during the epidemic period, which lasted from April, the business activities of industrial park real estate enterprises were heavily affected and it is highly likely to delay development plans in the short term.

A series of new industrial zones was established from the North to the South
As of May 2021, the whole country has 394 industrial zones with a total natural land area of ​​121,900 ha. Of which, there are 286 industrial zones in operation (3.78 million jobs) with occupancy rate of 71.8%, down from 74% recorded last year. In the first half of 2021, there are 25 newly established IPs, an increase of 19 industrial zones compared to the first 6 months of 2020.

Particularly in the first quarter of the year, dozens of industrial park projects in 13 provinces and cities have been approved, providing thousands of hectares of industrial land for future needs. Bac Ninh has the most projects with 5 upcoming IPs such as Que Vo III Industrial Park (208.54 ha with total investment capital of 120.9 million USD); Gia Binh II Industrial Park (250 hectares with a total investment of 172.2 million USD),...

Or Quang Tri has new projects such as Quang Tri Industrial Park (481.2 hectares with an investment capital of 90.2 million USD), Trieu Phu Industrial Park (529 hectares). Besides, Vinh Phuc is expected to have some new projects with a total supply of 500 hectares. Many new projects will also be implemented in the provinces of Hai Duong, Vinh Long, Quang Nam, Thua Thien-Hue, Nam Dinh and Nghe An.

In the southern region, there are 3 more expansion zones with a total area of ​​6,475 ha, including Long Duc 3 Industrial Park (253 ha), Bau Can - Tan Hiep Industrial Park (2,627 ha), Xuan Que - Song Nhan Industrial Park (3,595 ha). . Long An is expected to have 119 ha Century Industrial Park and a total investment of 59 million USD developed by Hai Son Co., Ltd in Duc Hoa district. In addition, Long An will have an additional 1,500 hectares of land for clearance in industrial zones to increase FDI attraction to Vietnam in 2021.

Many M&A deals were done in the year of COVID-19
From the beginning of the year until now, Savills has reported that there have been many new mergers and acquisitions (M&A) deals in the industrial real estate segment. In which, Boustead Projects Co., Ltd. reached an agreement to buy back 49% of shares in KTG & Boustead Logistics Industry Joint Stock Company.

This deal includes 13 real estate projects (of which 10 properties belong to KTG and three properties belong to Boustead Projects) with an estimated total asset value of USD 141 million, including about 840,000 m2 of land and about 550,000 m2 of total area for the project. to rent.

ESR Cayman Company Limited and BW Industrial Development Joint Stock Company (BWID) have entered into a joint venture to develop 240,000 square meters of industrial land in My Phuoc 4 Industrial Park, near Ho Chi Minh City.

Besides, Logos Property's 81,000 m2 project in VSIP Bac Ninh 1 Industrial Park is expected to come into operation in the fourth quarter of 2021; or joint venture SEA Logistic Partners (SLP) and GLP held the groundbreaking ceremony for the construction of the SLP Industrial Park project with a total construction area of ​​89,000 m2 in Hai Phong.

In addition, Vietnam Industrial Park Group Joint Stock Company has acquired a land fund of 250 hectares with an investment of 300 million USD with the goal of developing high-class warehouses for lease stretching from Bac Giang, Hai Phong, Hai Duong, Dong Nai and Long An. An.

But it is necessary to reconsider the current industrial park model
According to Savills expert, the blockade and travel restrictions due to the COVID-19 epidemic have slowed down the process of relocating production activities from China in 2021 as expected.

However, the developers believe that leasing will be more efficient in 2022. At the same time, tenants and investors will also have more options for new supply when many of the distancing orders are lifted.

In the South, especially in Ho Chi Minh City, after the news of easing the gap, about two-thirds of industrial activities have reopened; 66% of enterprises in export processing zones and industrial zones in Ho Chi Minh City and 74% of enterprises in Saigon Hi-Tech Park have returned to production.

Information from Savills said that Intel and Samsung aim to restore full capacity of factories in Saigon Hi-Tech Park by the end of November, helping to reduce disruptions to the supply chain.\

Besides the positive factors, experts say that the current model of Vietnam's industrial park is outdated. Industrial zones of several hundred hectares or 1,500 hectares are no longer suitable. To catch up with the investment wave in the future, new and attractive planned industrial park models are essential.

In particular, clustering can help industries move up the value chain and benefit specific industries. The consolidation of projects by sector can create production networks and value chains, reducing the imbalance of industries in the country.

Traditional master plans have posed many problems for the new wave of investment in industry in Vietnam as most of the leasable area is for manufacturing – often limiting data center investors materials and logistics.

Therefore, new industrial projects must carefully evaluate the overall planning and development options in relation to the actual needs of the market. This includes industrial zones near the city that create mixed-industrial projects by zoning land for logistics, cold storage, data centers and research and development (R&D) centers, etc.

Source: Vietnambiz

(Translated by Google)