Vietnam's economy has benefited from manufacturing investment.

DNHN - Production investment activities have remained stable and continue to draw in large numbers of foreign investors. Accordingly, Vietnam has contributed to economic stabilization through prompt monetary management policies.

Vietnam's performance has remained steady despite the global economic slowdown, making it very appealing to foreign manufacturing investors. The amount of newly registered foreign direct investment (FDI) reached 8.8 billion USD by the end of August 2023, up 69.5% from the same period the previous year. To encourage overall economic stability, the Vietnamese government has implemented monetary policies. In addition, public investments climbed by 23.1% annually in the first eight months of 2023, totaling $14.5 billion.

Since April 2023, export value has risen gradually, reaching a notable month-over-month pace of 7.7% in August. Since the US is one of Vietnam's main trading partners, the US saw a 10% decline in inventories in August, which helped to meet production needs. The industry that encourages real estate investment is still industrial real estate.

The province of Thanh Hoa and the Sumitomo Group (Japan) inked a Memorandum of Understanding in July to establish an industrial park covering 650 hectares and requiring an investment of USD 400 million. In Nam Dinh Province, they are also thinking about creating a 300-hectare industrial park.

Twelve development cooperation agreements were signed, two projects at the Vietnam-Singapore Industrial Park (VSIP) received investment approval, and three new projects started construction at the end of August. Vietnam's cold storage system will be enhanced and expanded through a joint venture between Lineage Logistics and SK Logistics, which was announced on August 11, 2023. In July, it was approved for Suntory Pepsico to construct a new factory in Long An, involving a total investment of 185 million USD, while Hyosung Group intended to invest close to USD 1 billion in a production facility. The production of carbon fiber in Vung Tau.

The shortage of available apartments will likely benefit investors who can successfully develop new projects for the market, according to Mr. Neil MacGregor, Managing Director of Savills Vietnam. Strong demand at the moment, particularly if they aim to appeal to the expanding middle-class segment of homebuyers.

According to Mr. Neil MacGregor, there are still opportunities for investors and developers in the office segment in Ho Chi Minh City, despite the city's high supply of newly constructed Grade A space. this region.

He did, however, add that developers or renovators can create green office buildings that will command higher rental fees.

Many experts also claim that well-known residential real estate investors like Vingroup, Masterise Homes, and Ecopark introduced several new products at the end of the year. In addition, it is anticipated that the updated Housing Law, which will eliminate the requirement for commercial housing projects to set aside 20% of their land area for social housing, will be approved during the 6th National Assembly Session at the end of 2023. Developers should see an acceleration of progress with this modification.

Savills Vietnam expert Mr. Troy Griffiths made the following observation about this matter: "While M&A activity is unpredictable, the manufacturing, trade, and service sectors will continue to be the driving force for Vietnam's economic growth." Real estate is getting more and more active.

"The State Bank of Vietnam's continued pursuit of reducing interest rates to 2020 is a good sign for residential real estate," stated Troy Griffiths.

The real estate investment market in the Asia-Pacific region (CA-TBD) is facing difficulties like rising interest rates and global instability, which has caused a notable slowdown, according to Savills' 2023 Asia-Pacific Investment (APIQ) Quarterly Report. Nonetheless, indications suggest that investor confidence is progressively increasing. The market dynamics, top market segments, and ways that Vietnam's resilience is drawing in foreign investment are all highlighted in the APIQ report.

Nghe Nhan