Such trends are the major issues to be discussed by experts at the latest Vietnam Industrial Property Forum, which will take place this week in Ho Chi Minh City.

According to JLL Vietnam, the evolution of industrial park (IP) development in Vietnam has been consistently progressive in recent decades. Initially starting as simple industrial clusters that brought manufacturers together in one location, it has now evolved into a new generation of IPs.

“These modern IPs, beyond providing basic internal infrastructure and facilities to tenants, go the extra mile to enhance their competitive edge by integrating value-added services, embracing sustainability initiatives and expanding their offerings to include components such as accommodation, retail spaces, and more, with the goal of creating vibrant and holistic environments that enhance both work and living experiences,” said Trang Le, head of Research & Consulting at JLL Vietnam.

Doan Duy Hung, founder of IIP Vietnam, the nation’s largest industrial real estate information portal, said that most investors with long-term vision are aiming towards a more modern type of industrial area.

“If we can develop industrial, service, and urban zones, it will certainly attract more foreign investors,” Hung said. “The product creates added value for investors, increasing the attractiveness of specific products. Many countries have successfully developed this model, such as Thailand, South Korea, China, and Germany. In Vietnam, some IP infrastructure investors also invest synchronously in urban areas, as well as services adjacent to IPs.”

One of the more outstanding models in this vein is VSIP Bac Ninh, belonging to the large-scale industrial network funded by Vietnam-Singapore Industrial Parks (VSIP).

VSIP Bac Ninh is located 12km from Hanoi, across an area of 700 hectares. Over 500ha is an IP with the presence of many large domestic and international corporations, with the remainder for a service urban area with a fully integrated utility system from commercial, educational, medical, and entertainment centres to high-tech parks, housing projects, apartments, and offices for lease.

Residents here fully inherit the high-quality amenities that VSIP has created over the years, which include a system of ecological parks, lakes, sports complexes, fully equipped entertainment areas, covered walking paths, and green space.

In addition, VSIP Bac Ninh invested nearly $1 billion in investment in infrastructure and service construction, promising to become the financial and commercial centre of the whole region.

Elsewhere, the country is taking proactive measures to minimise the environmental impact of manufacturing activities within its IPs via the introduction of the eco-IP model.

Bui Huu Tai, deputy general director of Tan Dong Hiep Investment and Construction Group Company, the investor of Tan Dong Hiep B IP located in Binh Duong province, said it is necessary to keep up with global green trends, especially in IPs.

“Many investors in IPs are losing orders to foreign countries because some foreign factories have followed the green trend, have green certificates, and when producing, they have tax advantages when exporting goods to Europe and the US,” Tai shared.

Vietnam needs coordination between IP investors, factory owners, including the government to set a standard for net-zero carbon and green IPs to be able to compete with foreign countries. “Vietnam must take preparation steps when there is no longer cheap labour in the region and prepare to find a new competitive advantage,” Tai said.

Since being selected to participate in an eco-IP pilot programme in 2020, instructed by the Ministry of Planning and Investment and others, Thailand’s Amata, a private developer and operator of industrial real estate sites, has undergone a remarkable transformation by following such preparation steps.

Through intensive research and implementation, Amata has achieved high improvement capabilities according to the international framework requirements for eco-IPs.

Over the past three years, Amata has undergone rigorous studies and executed comprehensive strategies to meet international standards of sustainability. This dedication has led to remarkable progress, with Amata City Bien Hoa achieving an impressive 86 per cent compliance rate with eco-IP standards by January 2024, a significant leap from its initial 41 per cent baseline.

Meanwhile, elevating strategic partnerships with the likes of the US and South Korea will promote the attraction of high-tech investment.

Marvell Vietnam is heading up microcircuit design in Vietnam. In May, it announced the establishment of an integrated circuit design centre in Ho Chi Minh City, located in Tan Thuan Export Processing Zone in District 7. The centre will be the place to research and develop the most advanced technologies in the field. At the same time, it could be an ideal working place for Vietnamese technology engineers, allowing them to hone their skills, opening up many career development opportunities in microchips and semiconductors.

Elsewhere, Choi Bundo, chairman of the Korean Chamber of Commerce in Vietnam, expressed that the elevation of Vietnam and South Korea’s relationship to a comprehensive strategic partnership has had a significant positive impact.

“To attract high-quality investors from Korea, Vietnam should provide more investment advantages, supporting the materials, components, and equipment industries, improving the legal and institutional environment, and developing human resources,” Bundo said.

“Future South Korean investments in Vietnam are likely to focus increasingly on renewable energy, advanced technologies including AI, and digital transformation.”

Source: Vietnam Investment Review