Vietnam is witnessing an impressive growth in foreign direct investment (FDI), reaching 38.23 billion USD in 2024, placing Vietnam among the top 15 developing countries attracting the most FDI worldwide. This abundant FDI flow is creating a “fever” in the industrial park land lease market, which is forecast to continue its strong growth in 2025.

Record FDI Growth, Reaching Highest Level Ever

According to the Foreign Investment Agency – Ministry of Planning and Investment, the realized capital of FDI projects is estimated at about 25.35 billion USD in 2024, up 9.4% compared to the previous year, marking the highest disbursement level ever. As of December 31, 2024, the country had 42,002 valid FDI projects with a total registered capital of nearly 502.80 billion USD.

Many technology giants such as Nvidia, Intel, Synopsys, Qualcomm, Infineon, Amkor… have been and are expanding their investments in Vietnam. Large projects in the fields of semiconductors, energy, component manufacturing, electronic products… are continuously being newly invested and supplemented with capital. In particular, the fact that Nvidia’s Chairman signed a cooperation agreement with Vietnam to establish an R&D Center for AI and an AI data center has affirmed the attractiveness of Vietnam’s investment environment.

High Demand for Industrial Park Land Leases

The strong growth of FDI has directly impacted the demand for industrial park land leases. According to Bao Minh Securities Company (BMSC), the demand for industrial park land leases in 2024 continued to remain high with occupancy rates in the North reaching 68% and in the South 82%. The average industrial land lease price also increased by 8% and 3% respectively compared to the previous year.

BMSC forecasts that the demand for industrial park land leases will continue its hot growth in 2025 thanks to many favorable factors:

• “China + 1” Trend: The US-China trade war and geopolitical uncertainties have prompted manufacturers to move out of China, and Vietnam is an attractive destination.
• Improved Infrastructure: Vietnam is investing heavily in developing transport infrastructure, seaports, and airports, creating favorable conditions for production and logistics activities.
• Administrative Procedure Reform: The Vietnamese government is striving to reform administrative procedures, creating a transparent and open investment environment.
• Competitive Production Costs: Electricity and labor costs in Vietnam are still lower than in many other countries in the region.
• Free Trade Agreements: Vietnam has signed 15 free trade agreements with 55 countries, creating a competitive advantage in attracting FDI.

Optimistic Forecast for 2025

Many research organizations and experts predict that FDI inflows into Vietnam will continue its strong growth in 2025, followed by an increase in demand for industrial park land leases. CBRE forecasts that industrial land lease prices will increase by 5-8% per year in the North and 3-7% per year in the South over the next 3 years. FPTS Research forecasts that Vietnam’s FDI capital in 2025 will increase by 6.6% compared to the previous year.

The record growth of FDI is creating a strong impetus for the development of Vietnam’s industrial real estate sector. 2025 is expected to be a boom year for the industrial park land lease market, with high demand and continued price increases.