5.5 million VND to rent one square meter of industrial land in Hanoi

A recent market report by real estate services firm Avison Young said that despite storm No. 3 affecting some industrial zones, the Hanoi market remained stable, showing sustainable growth momentum.

The average rental price of industrial parks in the city is over 220 USD (about 5.5 million VND) per square meter for a lease term. This price is still "competitive" compared to other provinces in the Northern Key Economic Zone. Some districts have an average rental price exceeding 250 USD (6.3 million VND) per square meter, including Me Linh, Long Bien, Soc Son, and Dong Anh.

Research unit CBRE also said that industrial land rental prices in tier 1 markets such as Hanoi, Hai Phong, Bac Ninh, Hai Duong, Hung Yen reached an average of 137 USD (more than 3.4 million VND) per square meter for the remaining term, up 4.6% year-on-year. In the first 9 months of the year, the absorbed area reached about 330 hectares, raising the average occupancy rate of the above provinces to 80%.

The rise in industrial land rents was also noted by real estate consultancy Cushman & Wakefield. According to this unit, rents in key northern markets increased by 5.7% year-on-year. Due to high demand, some projects in Bac Ninh and Hung Yen even increased prices by 10% in the quarter.

Explaining the above developments, Ms. Trang Bui, General Director of Cushman & Wakefield Vietnam, said that the added value of the entire industry in the first 9 months of the year continued to grow by 8.3%, with the driving force being the processing and manufacturing industry, which increased by 9.8%. This promoted positive developments in the northern industrial land leasing market, which has advantages in location, improved infrastructure and positive market sentiment.

She cited Bac Ninh province as continuing to lead the demand for industrial parks with 30% of the total net absorption area, followed by Hai Duong, Quang Ninh and Hung Yen with a proportion of 17-20% of the total net absorption area.

In the context of increasing foreign investment and the need to expand production, the occupancy rate of Hanoi's industrial parks also reached 86%, showing that the rental demand is still high, with most of the land area filled by investors.

Forecasting the market outlook, Ms. Nguyen Hoai An, Senior Director of CBRE Hanoi, said that industrial land rental prices in the North may increase by 4-8% in the next three years, while ready-built factory rental prices may increase slightly by 1-4% per year. Positive demand from the electronics, semiconductor and auto parts industries will create momentum for industrial real estate in the North.

Regarding new trends in the market, CBRE noted that many high-rise warehouse projects are planned or have started to be implemented in the North, especially in areas with convenient connections to Hanoi with competitive industrial land rental prices. This is a trend that appeared a few years ago in the Southern market.

"This solution helps investors optimize land use coefficient, increase supply in conveniently connected areas, and help the market have more products," said Ms. An.