During the 4th wave of Covid-19, Vietnam continued to have newly established industrial parks, and a few key industrial projects started operating. Notably, the market witnessed M&A deals and an improvement in supply. The largest industrial production projects in May 2021 came from Hong Kong and Singapore businesses in two markets, Quang Ninh and Bac Giang.

The latest IHS Markit report shows that the Purchasing Managers' Index (PMI) of Vietnam's manufacturing industry dropped to 53.1 points in May 2021 from 54.7 points the previous month. This is the lowest index since February, ending a streak of 3 consecutive months of increases due to the impact of the 4th Covid-19 wave. However, the efforts of the Government and businesses in both prevention and control. The Covid-19 pandemic has maintained production, which is expected to help industrial production continue to develop.

Social distancing and domestic travel restrictions have made it difficult for investors who want to rent industrial land, factories and warehouses because they cannot make field visits to provinces and localities. However, the operation of the industrial sector in the first 5 months of 2021 still recorded certain improvements. Mr. John Campbell, Head of Industrial Real Estate, Savills Vietnam said: “During the 4th Covid-19 wave, Vietnam continues to attract FDI. As of May 20, 2021, Vietnam has attracted a total of 13.9 billion USD in registered FDI. Manufacturing and processing industry attracted USD 6.1 (accounting for 43% of total capital), there were 215 new projects with a total registered capital of USD 2.57 billion and 222 existing projects registered an increase of 3.1 billion USD. USD capital.

The growth momentum of industrial real estate benefits positively from M&A deals and new supply of industrial real estate. Specifically:

In terms of M&A activities, the market has witnessed new deals in 2021. Typically, Boustead Projects acquired a 49% stake in KTG Bac Ninh Industrial Development Joint Stock Company in Yen Phong Industrial Park with about 6.9 million USD. ESR Cayman Limited - Asia Pacific's largest logistics real estate platform and BW Industrial Development Corporation (BW), Vietnam's leading logistics and industrial real estate developer , announced cooperation to establish a new joint venture with the goal of owning and jointly developing 240,000m2 in My Phuoc 4 Industrial Park near Ho Chi Minh City. This cooperation marks the entry of ESR Cayman Limited into the Vietnamese market, expanding the scope of this business in Southeast Asia.

Vietnam industrial real estate welcomes many new projects despite the complicated epidemic

With projects coming into operation, the Logos Property project with an area of ​​​​81,000m2 in VSIP Bac Ninh 1 Industrial Park is expected to come into operation in the fourth quarter of 2021. Vietnam Industrial Park Joint Stock Company has acquired a land fund of 250 hectares with a total investment of 300 million USD. The unit aims to develop sustainable, high-quality factories and logistics in Vietnam with a portfolio spanning Bac Giang, Hai Phong, Hai Duong, Dong Nai and Long An.

Regarding new supply, as of the first quarter of 2021, statistics from the Ministry of Planning and Investment show that there are 370 industrial parks established in the whole country with a total natural land area of ​​about 115,200 hectares. In which, 328 industrial parks are located outside economic zones, 34 industrial parks are located in coastal economic zones, 8 industrial parks are located in border gate economic zones. These industrial zones are estimated to have provided about 3.6 million new jobs in both the North and the South.

In the first quarter of 2021, dozens of industrial projects in 13 provinces and cities were approved, promising to provide thousands of hectares of new industrial area to meet investment needs in the coming years. Bac Ninh is the province with the largest number of future projects with 5 new industrial parks. Specifically, Que Vo III industrial park will be invested in an additional 208.54 hectares of area, with a total capital of 120.87 million USD. Bac Ninh will also welcome the Gia Binh II Industrial Park project with a planned area of ​​208.54 hectares, invested by Hanaka Group with a total investment of 172.17 million USD. Quang Tri province is also expected to have new industrial parks such as Trieu Phu multi-sector industrial park with an area of ​​​​529 hectares. In addition, the Quang Tri industrial park project with an area of ​​481.2 hectares was also approved with a total capital of 90.17 million USD, developed by a joint venture of three investors, including Vietnam - Singapore Industrial Park Joint Venture Company; Amata Bien Hoa Urban Joint Stock Company and Sumitomo Corporation.

In Vinh Phuc province, industrial park projects such as Song Lo, Tam Duong 1 and Thai Hoa - Lien Son - Lien Hoa with a total area of ​​up to 500 hectares will also be introduced in the near future. Along with that, many new projects are expected to be implemented soon in the provinces of Hai Duong, Nam Dinh, Nghe An, Quang Nam, Thua Thien Hue and Vinh Long.

In the south, Dong Nai Provincial People's Committee has announced a plan to build three new industrial zones with a total area of ​​6,475 ha to solve the problem of overloading of active projects. Specifically, the project includes: Long Duc 3 Industrial Park with an area of ​​253 hectares in Long Duc Commune (Long Thanh District); Bau Can - Tan Hiep Industrial Park covers an area of ​​2,627 ha in Bau Can and Tan Hiep communes (Long Thanh district) and Xuan Que - Song Nhan Industrial Park in Xuan Que commune, Song Nhan about 3,595 ha (Cam My district). These three industrial parks were approved by the Prime Minister and added to the master plan on development of high-tech industrial parks in Dong Nai province in 2020, with a vision to 2030.

Long An is expected to have a new industrial project worth $59 million in Duc Hoa district. The Prime Minister also has a decision on investment policy of Century Industrial Park project, invested by Hai Son Co., Ltd., implemented in Huu Thanh commune, Duc Hoa district, south of Long An province. The project has a land use scale of over 119 hectares, with a total investment of VND 1,355 billion, of which the investor's contributed capital is VND 400 billion. The project implementation schedule must not exceed 36 months from the date of land handover by the State. The project's operation period is 50 years from the date of issuance of the investment permit decision.

According to the Management Board of Long An Economic Zone, the province is expected to have an additional 1,500 hectares of land for clearance in industrial parks to attract foreign direct investment (FDI) into Vietnam in 2021. The industries that attract the most foreign investors are textiles and garments, footwear, animal feed, poultry, aquatic products, food processing, beverage and manufacturing.

According to batdongsan.com.vn