The Province That Has Just Become A Centrally Governed City Possesses The “Leverage” Of Long Thanh Airport And A USD 16 Billion FTZ For Its Ambition To Become A Regional Manufacturing And Logistics Hub

As Dong Nai officially becomes the country’s seventh centrally governed city, alongside the emergence of Long Thanh International Airport and plans for a Free Trade Zone (FTZ), the locality is facing an opportunity to reposition its role within Southern Vietnam’s economic structure. According to Mr. John Campbell, Director of Industrial Services at Savills Vietnam, these new growth drivers will not only accelerate industrial development but could also help Dong Nai upgrade its position within the regional value chain, particularly in manufacturing, logistics, and exports.

Dong Nai Enters a New Phase of High-Value Industrial Repositioning

For many years, Dong Nai has consistently ranked among the largest and most developed industrial markets in Southern Vietnam. According to Savills data as of December 2025, the province currently has approximately 6,725 hectares of leasable industrial land, with an occupancy rate of around 94%. In addition, the supply of ready-built factories and warehouses has reached approximately 3.48 million square meters, with occupancy nearing 95%.

The high absorption rate reflects strong leasing demand across both industrial land and ready-built facilities. Average industrial land rental prices currently stand at approximately USD 192/m² per lease term, while ready-built factory and warehouse rental rates average around USD 4/m²/month.

According to Savills, Dong Nai is no longer competing solely on industrial land availability but is increasingly positioned to develop higher-value industrial ecosystems such as high-tech manufacturing, air logistics, supporting industries, and export processing zones.

Today’s investors are no longer focused only on land rental costs. They are paying greater attention to factors such as labor availability, housing, amenities, transportation infrastructure, and long-term expansion potential.

Savills data also shows that from 2021 through the first ten months of 2025, the fabricated metal, machinery and equipment, and electrical equipment sectors accounted for more than 40% of all new manufacturing projects in Dong Nai. Meanwhile, electronics, rubber, and plastics also recorded significant shares, highlighting the province’s increasingly important role in supporting industries and export-oriented manufacturing.

From an investment capital perspective, China currently accounts for approximately 27% of new manufacturing projects in Dong Nai, followed by Singapore, South Korea, and Japan. According to Savills, this reflects the ongoing diversification of global supply chains as well as the continued expansion of existing Asian manufacturing clusters.

During the period from 2021 to the first ten months of 2025, Dong Nai recorded 375 new manufacturing projects. Factory leasing transactions have also increased significantly in recent years, reflecting sustained demand for production expansion.

“Leasing demand has increased substantially over the past few years. New FDI manufacturing projects in Dong Nai rose from 31 factory lease transactions in 2021 to 110 transactions in 2025. Land lease transactions also increased from 10 deals in 2021 to 29 deals in 2025, demonstrating growing investor confidence in long-term expansion commitments,” said Mr. John Campbell.

Long Thanh Airport and the FTZ Could Reshape Southern Vietnam’s Logistics Chain

One of the factors expected to create transformative change for Dong Nai is Long Thanh International Airport together with the planned USD 16 billion Free Trade Zone (FTZ).

According to Savills, Long Thanh is not merely an international passenger airport but could become a new air cargo gateway for Southern Vietnam. Combined with the seaport system in Ba Ria – Vung Tau and Ho Chi Minh City’s role as a financial and service center, Dong Nai has the opportunity to establish an integrated development model connecting industry, logistics, and exports.

Businesses could establish manufacturing facilities in Dong Nai, consolidate goods at logistics centers near Long Thanh Airport, and export products through both air freight and deep-water seaports. The flexibility of multimodal logistics would help reduce transportation time and enhance supply chain resilience.

In addition, the FTZ is expected to create further opportunities to attract higher value-added industries and logistics activities. Sectors considered to have strong potential include electronics, electrical equipment, machinery, supporting industries, cold-chain logistics, medical equipment, and regional distribution centers. These industries stand to benefit significantly from multimodal logistics capabilities, customs facilitation, and the connectivity advantages provided by Long Thanh Airport and the regional seaport network.

According to Savills, rather than competing broadly across all manufacturing sectors, Dong Nai could focus on developing a more specialized industrial ecosystem to differentiate itself from neighboring localities.

Major Opportunities, but the Competition Will Depend on Infrastructure and Institutions

Despite its many new growth drivers, Savills believes Dong Nai still faces several challenges that must be addressed to fully capitalize on the potential of the FTZ and Long Thanh Airport.

The first bottleneck lies in infrastructure connectivity, particularly “last-mile” transportation links between industrial parks, the airport, and seaport corridors. Although many large-scale infrastructure projects are currently underway, transportation efficiency and logistics integration will remain critical to the effectiveness of the entire industrial-export supply chain.

Another challenge concerns institutional mechanisms and the legal framework. According to Savills, FTZ models require streamlined customs procedures, flexible tax policies, and more efficient investment approval processes. Without sufficiently clear and adaptable policies, the anticipated benefits of the FTZ may be difficult to fully realize.

In addition, regional planning coordination between Dong Nai, Ho Chi Minh City, and Ba Ria – Vung Tau is considered increasingly important as supply chains and logistics networks become more interconnected.

“If the FTZ, airport, and logistics infrastructure are successfully implemented, Dong Nai could transform from a traditional manufacturing center into a key regional manufacturing and logistics hub,” Mr. John Campbell concluded.