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Industrial land lease prices in North forecast to increase sharply

Rising demand for land leases is being seen among industrial groups.

“Though the real estate market and the economy met many challenges in 2023, industrial real estate was considered a bright spot.” CBRE Vietnam Senior Director Nguyen Hoai An told in a recent meeting on the real estate market’s outlook in Hanoi and Ho Chi Minh City.

Industrial land lease prices in the Northern region are forecast to rise sharply, said participants at a seminar organized by the Academy of Finance on January 4 in Hanoi. They are also forecast to increase by 5 – 9% annually over the next three years, according to property consultants CBRE Vietnam. Occupancy of industrial land in the country’s North and South stood at 81% and 92%, respectively, in the 4th quarter of 2023. Meanwhile, ready-built warehouse rental prices are anticipated to increase slightly by 1 – 4%.

Industrial land lease prices in North forecast to increase sharply - RSL Group
Industrial land lease prices in North forecast to increase sharply

Vietnam’s expansion of cooperation with major economies will also open up opportunities for the real estate sector. Specifically, after Vietnam recently upgraded its cooperative relations with major partners such as the US, Korea, and China, investment capital flows from these countries are expected to continue which will drive demand for leasing industrial land in the upcoming time in Vietnam.

According to Mr. Stephen Higgins, Senior Director of Cushman & Wakefield Capital Markets, the market size of the three industrial real estate segments (including industrial parks, factories for rent and warehouses for rent) will grow at least twice in the next 10 years because logistics companies will serve the domestic consumer market and thus be closer to central residential areas.