Industrial real estate wins big

Although the general market has not yet overcome difficulties, the industrial real estate sector is still winning big, with businesses leasing factories and warehouses recording positive business results.

Industrial real estate is still growing well. In the photo: ILD Coffee Vietnam factory developed by LDC and Instanta.

Impressive growth

The stock market witnessed a spectacular breakthrough of industrial park real estate stocks. Some of the codes that recorded impressive growth on the Ho Chi Minh City Stock Exchange (HoSE) include SIP, KBC, SZC, BCM, IDC... In which, SIP and KBC showed outstanding strength with trading volume soaring over 300%, leading to a stock price increase of about 10%. The codes SZC, BCM, IDC were not far behind with liquidity increasing by 90 - 140%.

Businesses in this sector are enjoying “smooth sailing” with positive business results in the third quarter of 2024. For example, Saigon VRG Investment Joint Stock Company (stock code SIP) saw a 16% increase in revenue and 56% in profit. This result was contributed by the service provision segment, distributed dividends, and profits from the sale of investments.

Saigon VRG Investment Joint Stock Company is operating 4 industrial parks including Phuoc Dong, Dong Nam, Le Minh Xuan 3, Loc An - Binh Son, with a total area of ​​over 3,200 hectares, of which there are more than 1,000 hectares of commercial land not yet leased, distributed in Tay Ninh, Dong Nai and Ho Chi Minh City.

The industrial real estate market in Vietnam is assessed to be in a more vibrant and promising period than ever, receiving many positive signals.

Kinh Bac Urban Development Corporation (code KBC) also made a strong impression with its financial report for the third quarter of 2024. Kinh Bac's net profit reached more than VND 196 billion, an increase of 41.7 times compared to the same period last year. The main contributor to this result was revenue from industrial park business activities, reaching more than VND 580 billion.

With abundant land funds in the Quang Chau, Tan Phu Trung and Nam Son Hap Linh industrial parks, Kinh Bac Urban Development Corporation is expected to continue to earn huge profits from land leasing activities. According to Vietcombank Securities Company (VCBS), Kinh Bac's current land fund can bring in nearly VND7,000 billion from rental cash flow.

Similarly, IDICO Corporation – JSC (code IDC) recorded net revenue of VND2,276 billion, up 58% over the same period last year. Notably, IDICO's after-tax profit reached VND574 billion, an impressive growth of 195%. According to the explanation from the Company, this positive business result comes from recording one-time revenue from industrial park infrastructure leasing contracts.

Not out of the general trend, Hoa Phat Group Joint Stock Company (code HPG) also recorded strong growth in the industrial park real estate segment. Specifically, revenue from real estate sales and leasing in the third quarter of 2024 reached VND 730 billion, a sharp increase compared to VND 30.6 billion in the same period in 2023. This boost came from Hoa Phat leasing 70 hectares of land at the expanded Pho Noi A Industrial Park.

Race to collect land fund

The industrial real estate market in Vietnam is assessed to be in a more vibrant and promising period than ever, receiving many positive signals.

A recent report by Savills Vietnam shows that Vietnam’s industrial and digital sectors are thriving, supported by strong FDI inflows, large-scale infrastructure projects and a favorable regulatory environment. The country’s shift towards high-value-added manufacturing, coupled with expanding logistics and data center capabilities, are boosting Vietnam’s position in the global supply chain.

With its competitive costs, strategic location and numerous trade agreements, Vietnam is well-positioned to capture this new wave of investment. As the country becomes increasingly integrated into global markets, Vietnam will play a pivotal role in Southeast Asia’s industrial future, serving as an ideal destination for advanced industrial and logistics solutions.

“Vietnam’s strong FDI inflows, strategic location, competitive costs, e-commerce growth, open trade policies and role in the global supply chain are essential to the long-term supply and performance of the industrial real estate segment. Notably, the development of e-commerce and increased FDI have increased the demand for warehouses and ready-built industrial space,” said Mr. John Campbell, Director and Head of Industrial Real Estate (Savills Vietnam).

From the current momentum, experts predict that industrial real estate will continue to “carry” the general market with a recovery momentum at the top. Accordingly, money will flow strongly into the pockets of “giants” such as Kinh Bac, Viglacera, Becamex, IDICO…

In addition, the potential of industrial real estate is also attracting a series of "big guys" to join the race. For example, in the upcoming strategy, TTC Land will expand its industrial real estate and logistics real estate segments in the Southern market. Or Taseco Land has recently paid special attention to the industrial real estate segment.

Recently, DIC Holdings, a member of DIC Corp, cooperated with Van Thuong Industrial Park Infrastructure Development Company Limited to be given priority as the general contractor for the construction of infrastructure for a 400-hectare project in Phu My town (Ba Ria - Vung Tau).

Other names such as Ha Do, Vinaconex, Becamex, Viglacera… are also showing many ambitions in the land acquisition race. A representative of Phat Dat Real Estate Development Joint Stock Company said that the Company plans to return to the industrial real estate race.

Faced with the vibrant market, Mr. Nguyen Van Dinh, Chairman of the Vietnam Real Estate Brokers Association, said that the industrial park real estate race will continue to heat up in 2025, because this is the "star" segment of the market.

Source: https://baodautu.vn/batdongsan/bat-dong-san-cong-nghiep-thang-lon-d230449.html