New northern industrial parks attracting foreign investors

The report also showed that as of the third quarter of 2024, the average occupancy rate of industrial parks (IPs) in the north was 77 per cent, up 4 per cent on-year, with a focus on electronics, automobiles, packaging, and flooring.

According to the survey, next year should see additional facilities from BW Industrial, KCN Vietnam, Frasers Property, Mapletree, Thuan Thanh Xanh, HKBC, Vietnam Logistics and Wiin, among others.

Do Hong Quan, CEO of VNIC-Vietnam Investment Consulting, said, "According to our observations, the new facilities will focus on established industrial hubs, such as Bac Ninh, Haiphong, Bac Giang, and Thai Nguyen, bringing further overseas investment to the north."

"The industrial real estate market continues to show optimistic signs this year, continuing into 2025. However, there are still a few pending issues that need to be resolved. For example, the land clearance process is still slow, and the cost remains high. The cost for basic construction and land rent is also increasing," Quan said.

The average rent in IPs is $4.60 per square metre per month, up 2 per cent on-year. Meanwhile, the average land rent is approximately $156 per square metre, up 6 per cent on-year.

The geopolitical situation is also a factor potentially impacting the flow of foreign investment into the country, for example, the US presidential election.

"Many of our partners are paying attention to the US election. If Trump wins, they may invest in countries in Southeast Asia with more capital than they would if Vice President Kamala Harris wins. This is because Trump’s proposed tariffs will impact China's exports to the United States," Quan said.

"During the debates, Trump said he would impose tariffs of 60 per cent or higher on Chinese goods were he to win a second term in office. Therefore, we can forecast that there will be a shift in production facilities from China to other countries in Southeast Asia to avoid these tariffs," added Quan.

During Trump’s presidential term, the US imposed a 10 per cent tariff on $200 billion worth of Chinese goods. At the time, a series of foreign investors moved their operations from China to Vietnam, including Hanwha Group, Yokowo, Huafu, Goertek, and TCL.

In addition, those already present in Vietnam expanded their operations here, such as Foxconn, Luxshares, Nintendo, and Sharp.

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