Many real estate companies are investing heavily in industrial parks (IPs). It is forecasted that this segment will continue to be a bright spot in the next 1-3 years.
Many housing businesses "encroach"
Sharing with reporters of Dau Tu Newspaper, a representative of a large real estate company said that they had gone through a nightmare year in 2023. The project land product segment was almost "frozen".
In that context, from a unit specializing in commercial and residential real estate projects, this enterprise has decided to invest "all in" in industrial parks. The company is even completing documents to participate in the 2024 Industrial Real Estate Forum organized by Investment Newspaper.
At the 2024 annual general meeting of shareholders of many real estate businesses, many "amateur" units also clearly expressed their ambition to "encroach" on the industrial real estate segment.
For example, recently, Ha Do Company - the investor of many apartment buildings - began researching and planning industrial park real estate projects in the provinces of Hung Yen, Thai Binh, Long An, Can Tho, and Ninh Thuan.
Similarly, Taseco Land, a company famous for its housing projects, has also made a move to "attack" the industrial real estate market.
In May 2024, this enterprise borrowed capital from VietinBank and BIDV with a total amount of nearly 1,708 billion VND to implement the Dong Van III Industrial Park Project (Ha Nam). This is the project that marks the beginning of Taseco Land in the field of investment and business in industrial park infrastructure.
Another housing developer, Nha Khang Dien, has also “set foot” in the industrial real estate segment. At the 2024 annual shareholders’ meeting, Chairman of the Board of Directors Mai Tran Thanh Trang said that the Le Minh Xuan Industrial Park Expansion Project (HCMC) has completed phase I of legal procedures and is expected to generate revenue from 2025.
In addition, BCG Land, a company specializing in urban areas and resort tourism projects, cannot deny the attraction of industrial real estate. The company's leaders plan that by 2028, the company will seek more partners to invest in this segment.
“Star of hope” of the real estate market
In the Vietnam Financial Advisors Summit (VWAS) 2024, organized by Dau Tu Newspaper, when surveying the sectors that investors trust to include in their stock investment portfolio, industrial park real estate is one of the most chosen sectors with a rate of up to 44%. This figure is higher than retail (39%), residential real estate (32%) and only behind banking (62%). This shows that investors are very confident in the development prospects of this segment.
“Since the end of 2023, the real estate market has just entered the recovery process and has not really ended its difficulties. However, in that gloomy picture, the industrial real estate segment is still the 'star of hope' of the market,” said Ms. Pham Thi Mien, Deputy Head of Market Research and Consulting, Investment Promotion (Vietnam Association of Realtors - VARS).
This person also revealed that VARS is also supporting and connecting many "amateur" real estate businesses to switch to industrial real estate.
“They are called ‘amateurs’ but in fact they have been quietly researching and looking for partners in the industrial real estate sector. Many mergers and acquisitions (M&A) deals have been brewing since the end of 2022 and are expected to become more active in 2023,” said Ms. Mien.
For example, Taseco Land's leaders had planned to expand their investment in industrial park infrastructure real estate two years ago. But it was not until the 2024 annual shareholders' meeting that the unit's leaders shared this intention.
However, the industrial real estate market is not a paradise for all businesses. A company representative shared that they are facing many difficulties in realizing ESG (environmental, social and governance) standards.
“Up to now, we are still unclear about the general criteria for businesses implementing ESG. In addition, the amount of money spent on upgrading and building new infrastructure to meet the criteria is also very large, especially in the context of businesses not fully recovering,” the representative of the above business shared.
According to Ms. Nguyen Hoai An, Director of CBRE Hanoi, businesses will have to anticipate challenges when investing in this segment. For example, this year, the application of the global minimum tax may make tenants hesitate. In addition, investment costs for new industrial parks will also be higher, due to rising land prices and the prolonged land acquisition process.
Source: https://baodautu.vn/batdongsan/doanh-nghiep-tay-ngang-dau-tu-bat-dong-san-cong-nghiep-d218129.html
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