Vietnam’s industrial real estate sector has been experiencing remarkable growth, positioning the country as a prime destination for industrial investments. This surge is driven by strategic government policies, robust economic performance, and an increasing influx of foreign direct investment (FDI). For investors seeking lucrative opportunities, understanding the factors contributing to Vietnam’s industrial appeal is essential.
Why Vietnam is a Hotspot for Industrial Investment
Vietnam has become a top destination for industrial investment thanks to its rapid economic growth, strategic geographical location, government investment incentives and the concentration of large, potential industrial parks. Here are the main reasons why Vietnam is an attractive choice for investors.
- Rapid economic growth
Vietnam’s economy has continued to grow strongly, becoming one of the fastest growing economies in Southeast Asia. In 2024, Vietnam’s GDP increased by 6.8% compared to the same period last year, reflecting continued positive socio-economic development in key areas (1). Even during the COVID-19 pandemic, Vietnam maintained positive growth, something many other countries could not do.
- Strategic geographical location
Vietnam’s economy has continued to grow strongly, becoming one of the fastest growing economies in Southeast Asia. In 2024, Vietnam’s GDP increased by 6.8% compared to the same period last year, reflecting continued positive socio-economic development in key areas (1). Even during the COVID-19 pandemic, Vietnam maintained positive growth, something many other countries could not do.
- Strategic geographical location
With a strategic location possessing a 3,300 km long coastline, With a 3,300 km long coastline and many deep-water ports, Vietnam has a great advantage in importing and exporting goods by sea.
- Government investment incentives
The Vietnamese government offers attractive tax incentives, including corporate income tax exemptions and reductions, to encourage industrial investment (2). With a corporate income tax rate (CIT) in Vietnam of only 20%, lower than many other countries. In particular, enterprises investing in industrial parks, high-tech parks or economic zones can enjoy tax incentives for 10–15 years or even tax exemptions in some cases.
- A large and developed industrial park system
Vietnam has more than 400 industrial parks spread across the country, playing an important role in attracting industrial investors. Large industrial parks are well-invested with roads, electricity, water, telecommunications and an optimal logistics system for production.
Key Locations for Industrial Land Investment in Vietnam
These are large industrial parks in Vietnam that attract many foreign investors with potential advantages and good incentives.
- Northern Vietnam: As of Q3 2024, the total industrial land area in Northern Vietnam reached 16,700 hectares, marking a 16% increase compared to 2023. This expansion underscores the region’s growing importance as a manufacturing and logistics hub (3).
- Nam Dinh Vu Industrial Park (Hai Phong): Strategically located within the Dinh Vu – Cat Hai Economic Zone, Nam Dinh Vu Industrial Park offers unique advantages, including an internal international seaport and comprehensive infrastructure.
- Bac Ninh and Hung Yen Provinces: These provinces have seen a 10% surge in rental prices due to heightened demand, reflecting their attractiveness to investors (4).
Advantages of Investing in Nam Dinh Vu Industrial Park
Nam Dinh Vu Industrial Park is located in Hai Phong, one of the largest port cities in Vietnam and a key industrial center in the North. With its location near Cai Mep deep-water port and Lach Huyen port, Nam Dinh Vu Industrial Park has direct connections to international sea routes, convenient for importing and exporting goods. This is a great advantage for businesses wishing to export products to international markets, especially Asia.
With a complete transportation system, highways conveniently connect to neighboring areas and seaports. Electricity, water, and telecommunications systems are fully and stably supplied. The developed warehouse and logistics area helps reduce transportation costs for domestic and foreign businesses.
In addition, the Vietnamese government and Hai Phong authorities have implemented a number of attractive incentive policies for businesses investing in Nam Dinh Vu Industrial Park, including:
- Exemption of import tax on machinery and equipment for production.
- Long-term corporate income tax reduction for new investment projects.
- Exemption of land tax in industrial parks and incentives on long-term land lease.
- Investment support policies from local authorities, including administrative procedure support, help businesses save time and costs.
Future prospects of industrial real estate in Vietnam
In the period from 2025 to 2030, the industrial real estate market in Vietnam is expected to continue to grow strongly, especially thanks to attracting investment in industrial parks. The government’s promotion of incentive policies, along with the increase in production demand from foreign enterprises, creates great opportunities for the industrial market. It is forecasted that industrial parks in Vietnam will witness increasingly high occupancy rates and investment in infrastructure will increase (4).
Large industrial parks in Vietnam not only meet production needs but are also equipped with modern infrastructure, providing maximum support for production activities. This helps to enhance the attractiveness of Vietnam as a center for the production of high-quality goods.
Preferential policies such as tax exemptions and land support have created a favorable business environment for investors. In addition, the development of transport infrastructure, seaports, and warehouses will increase connectivity and reduce transportation costs, creating a competitive advantage for the industrial real estate market in Vietnam.
Source:
(1). Savills
(2). CBREVietnam
(3). B-Company
(4). Vietnam-Briefing