Vietnam’s Industrial Efficiency Sets a New Benchmark, Elevating FDI Attraction

Vietnam’s industrial real-estate market efficiency is entering a new phase of attractiveness for foreign direct investment (FDI). Between 2015–2024, Vietnam maintained an average FDI growth rate of about 5% per year, while several peer ASEAN economies experienced declines of 1-3%.

This steady momentum reflects Vietnam’s ability to sustain investor confidence, even as global supply chains restructure, an environment recognized as offering low risk and strong reform momentum compared to many regional peers

Key to this shift is the re-orientation from simply being a low‐cost manufacturing hub towards becoming an efficiency- and value-focused destination. In this context, industrial real estate is moving beyond “cheap labor, cheap land” models to incorporating higher quality infrastructure, logistics integration, smart manufacturing readiness.

Infrastructure Efficiency and Logistics: The Backbone of the Shift

A major driver of the upgraded value proposition is infrastructure investment. Vietnam is committing around 5.5%-5.7% of GDP annually to infrastructure, outpacing many ASEAN peers. Project examples include the North-South expressway, Lach Huyen deep-water port and Long Thanh International Airport

This fast-tracking of logistics and supply-chain connectivity is expected to reduce logistics costs by 1.0-1.5% of GDP by 2025-2030, directly improving industrial-park investment economics. As a result, Vietnam is poised to shift its competitive edge, not from being the cheapest in the region, but from being most optimized with operation efficiency, best connected and low-risk, attributes highly valued by global investors.

The Quality Upgrade in FDI and Industrial Parks

According to the Director of Roland Berger Vietnam – Mr. Truong Bui, the next wave of FDI is no longer purely about expanding production capacity, but upgrading value: shifting from traditional manufacturing to higher-value, technology-driven operations, logistics hubs and smart industrial ecosystems.

For industrial-park developers, this means a change in role: from land‐provider to ecosystem creator. The future successful park will integrate R&D, training, renewable energy, digital infrastructure and logistics services, all within a “one-stop” industrial ecosystem.

Vietnam’s industrial-real-estate market is moving into what might be called Phase 2.0, where the criterion is not just lower cost, but higher standard and greater value-add.

Implications for Investors and Occupiers

Facility Standards & Ecosystem Readiness: Occupiers are increasingly looking for industrial parks that deliver modern infrastructure, reliable power, renewable-energy options and integrated services. Standard factories and speculative warehouses may increasingly lag behind.

Location & Connectivity: Proximity to ports, airports, expressways, and logistic hubs is now a table-stakes requirement. The real premium will go to sites that deliver logistics time-to-market, low risk, and expansion flexibility.

Long-Term Value, Not Just Short-Term Cost: The shift from cost-advantage to value-advantage means occupiers and investors need to think beyond “cheap land”. Instead: strategic supply-chain partitions, technology readiness, ESG compliance, and competitive resilience in global production networks.

Developer Role Expansion: Industrial Park operators will need to evolve, not just provide infrastructure, but manage ecosystems, logistics, human-capital supply, and energy systems. Those who adapt will lead; those who don’t may be left behind.

How Core5 Vietnam Aligns with the Trend

While this analysis remains focused on the broader market, it is worth noting that Core5 Vietnam is shaped by these dynamics. Through modern industrial-facility development in Northern Vietnam and strategic logistics-corridor positioning, Core5 is aligning with the shift towards higher value industrial real estate, offering infrastructure, flexibility and connectivity that respond to this next wave.

Key Takeaways:

Vietnam’s industrial-real-estate sector is undergoing a pivotal transformation. With strong infrastructure investment, steady FDI performance, global wave of supply-chain repositioning, the country is not just benefiting from cheap manufacturing, but is poised as an efficiency–driven, value-added hub.
For industrial-park developers, tenants, and investors, success will come to those who understand that the future lies in smart infrastructure, ecosystem integration, and long-term supply-chain alignment, rather than cost-only plays.

For investors seeking to capture opportunities, Core5 Vietnam provides more than facilities , we are your strategic partner in long-term success.

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