According to CBRE Vietnam's latest report, the industrial real estate market will maintain positive growth momentum in 2025, with expected rental price increases of 4-8% in the Northern region and 3-7% in the Southern region. This is a positive signal demonstrating Vietnam's industrial real estate market's attractiveness to both domestic and foreign investors.
Industrial Real Estate - Market Highlight of 2024
According to Mr. Le Trong Hieu, Director of Office and Industrial Services at CBRE Vietnam, industrial real estate continued to affirm its role as the market-leading segment in 2024. This is evidenced by major global manufacturing corporations such as Samsung, LG, Foxconn, Hyosung, and Nestlé expanding their operations in Vietnam, accompanied by record FDI disbursement of USD 25 billion.
Impressive Occupancy Rates and Absorption
The Northern industrial real estate market recorded an average occupancy rate of 80%, while this figure in the South reached 89%. Notably, the Northern region achieved impressive absorption of over 400 hectares in 2024, primarily from large projects in electronics and electric vehicles. In the South, although absorption area decreased by 52% compared to 2023, reaching 265 hectares, the main reason was identified as limited industrial land supply in key markets.
Industrial Real Estate Rental Rates by Region
The rental price gap between the two regions is narrowing, with average rental rates in the North reaching USD 137/m2/term (up 4.2% year-over-year) and the South reaching USD 175/m2/term (up 1.4%). Notably, the Central region, especially Nghe An, is emerging as an attractive destination with competitive rental rates ranging from USD 60-90/m2.
Strong Development in Ready-Built Factory and Warehouse Segments
2024 witnessed impressive growth in the ready-built factory and warehouse market. This segment achieved its highest absorption in three years across both regions.
Ready-Built Factories (RBF)
RBF projects achieved occupancy rates of 88% in the North and 89% in the South, with uniform rental price increases of 2% compared to the previous year, reaching USD 4.9/m2/month in the North and USD 5/m2/month in the South. Notably, both regions received new supply of approximately 0.5 million m2.
Ready-Built Warehouses (RBW)
The RBW segment recorded net absorption of 0.2 million m2 in the North and 0.4 million m2 in the South. Industrial real estate rental rates for this type reached USD 4.7/m2/month in both regions by the end of 2024.
Market Outlook for 2025-2027
The industrial real estate rental market is expected to continue strong development over the next three years, with numerous new projects being implemented in key provinces and cities.
2025 is forecasted to be another dynamic year for the Industrial Real Estate Market
Rental Price Forecasts and New Industrial Park Development
Industrial land rental prices are forecast to increase by 4-8% annually in the North and 3-7% annually in the South. New industrial parks will focus on development in Hai Phong, Vinh Phuc (North), Binh Duong, Dong Nai, Long An (South), and Central provinces such as Thanh Hoa, Nghe An, Ha Tinh, and Quang Nam.
Challenges and Opportunities
Although 2025 is forecast to face numerous challenges due to geopolitical fluctuations, Vietnam's industrial real estate market is still expected to maintain growth momentum thanks to domestic economic development, FDI flows, infrastructure investment, and an increasingly improved investment environment.
With positive signals from the industrial real estate rental market in 2024 and favorable forecasts for the 2025-2027 period, Vietnam is gradually affirming its position as an attractive destination for regional and global investors in the industrial real estate sector.
Cre: VIR
>> See more: Vietnam's Economy 2024: Exceeding Growth Targets Amid Challenges
