An industrial park in Đồng Nai Province in southern Việt Nam. The province hosts 31 operational parks as foreign investors ramp up spending on factories, warehouses and ready-built facilities. — VNA/VNS Photo

HCM CITY — Việt Nam’s industrial property market is heating up as foreign investors pour billions of dollars into factories, warehouses and ready-built facilities, driven by accelerating supply chain shifts and a new surge of global capital.

Foreign direct investment (FDI) into Việt Nam hit US$26.1 billion in the first eight months, up more than 27 per cent from a year earlier, according to the General Statistics Office.

Manufacturing dominated the inflows, attracting nearly $12 billion, with many companies opting for ready-built factories to slash costs and shorten production timelines.

In HCM City, Avery Dennison Worldon Vietnam, a venture between US labeling giant Avery Dennison and China’s Shenzhou Group, inaugurated a $4.7 million plant in June, its third in Việt Nam.

Đà Nẵng has also emerged as a magnet, signing agreements with Amata Vietnam, Green i-Park, GuogGuoguang Electric and European Plastic to explore projects in its free-trade zones.

GuogGuoguang Electric, a Chinese electronics supplier, is set to break ground on a component plant in Liên Chiểu before year-end.

Dutch developer CTP is committing 1 billion euros ($1.1 billion) to new industrial zones across Hưng Yên, Gia Lai and other provinces, underscoring confidence in Việt Nam’s role as a regional hub.

Race for ready-built space

The supply of ready-built factories has ballooned to 11 million square metres nationwide, with occupancy topping 85 per cent, Cushman & Wakefield estimates.

Hubs such as HCM City, Đồng Nai, Bắc Ninh and Hải Phòng are leading the charge.

Rents run $4-6 per square metre in the North and $5-7 in the South – attractive compared with building plants from scratch, which can cost $3-6 million upfront.

“Speed and flexibility are decisive in global supply chains,” said Trang Bùi, general director of Cushman & Wakefield Vietnam. “Ready-built factories allow firms to ramp up production immediately without being tied to long-term assets.”

Infrastructure momentum

The Government is pushing ahead with big-ticket infrastructure, including new bridges in Hà Nội, the proposed Gia Bình International Airport in Bắc Ninh, and a high-speed rail line linking Lào Cai, Hà Nội, Hải Phòng and Quảng Ninh.

Administrative reforms are also cutting red tape. “These changes are making Việt Nam a priority destination for global manufacturers and logistics groups,” said Michael Piro, CEO of Indochina Capital.

His firm’s joint venture, Indochina Kajima, has launched six Core5 ready-built factory projects across Quảng Ninh, Hưng Yên and Hải Phòng in just three years.

The influx of foreign capital is driving up industrial land rents. CBRE reports average rates in Hà Nội, Bắc Ninh and Hưng Yên rose nearly 4 per cent year-on-year to $139 per square metre.

In the South, Cushman & Wakefield pegged average rents at $179.

Investors are also demanding greener, higher-standard facilities. Core5’s LEED- and ESG-certified projects in Quảng Ninh and Hưng Yên achieved near-full occupancy within months. Japanese investor Hulic has joined forces with Core5 to expand further.

Trade shifts

The wave comes as Việt Nam cements its position in the “China+1” strategy.

A new US tariff regime on Asian exports that took effect in August imposed duties of 20 per cent – lower than initially feared – boosting confidence in Việt Nam as an alternative base.

Tech and consumer giants including Samsung, Intel, LG, Foxconn, Amkor, NVIDIA, Toyota, Unilever and Procter & Gamble are already entrenched in the country.

Contract manufacturers for Nike, Adidas and Puma have also scaled up operations, creating tens of thousands of jobs and deepening supporting industries from packaging to precision engineering.

“Việt Nam is steadily consolidating its position as a global industrial hub,” said Matthew Powell, director at Savills Hanoi. “Strategic location, competitive costs and modern facilities are proving irresistible for foreign investors.” — VNS