Northern industrial real estate supply increases dramatically
A report from Cushman & Wakefield Company said that after redefining the Northern Economic Zone according to the new administrative unit, the total accumulated industrial land supply in the whole region reached 23,563 hectares, recording a breakthrough increase – about 37% in scale compared to before.
Along with that, the market continued to receive new supply in the quarter, with 3 industrial parks being started in Phu Tho, Hai Phong and Ninh Binh, adding more than 700 hectares of land for lease.
However, the average occupancy rate of the Northern industrial land market in the third quarter of 2025 was only 67%, down from the previous quarter. However, this was a forecasted development and does not reflect a weakening of demand. The main reason comes from the fact that a large amount of new supply from provinces outside the key economic zone, such as Bac Giang and Phu Tho, was introduced to the market after the merger, causing the market to need time to absorb. In fact, demand remains strong at the industrial “locomotives”.
HANOI NEARLY FILLS EXISTING INDUSTRIAL LAND FUND
“In particular, Hanoi has almost completely filled its existing land fund, while Bac Ninh is 75%. Leasing demand continues to focus on technology, electronic components and circuit board manufacturing industries,” Cushman & Wakefield’s report stated.
The asking price for industrial park land in the quarter reached about 133 USD/m2/lease term, down slightly by 2% compared to the previous quarter – mainly due to the addition of localities with lower prices to the regional calculation scope, but overall, the rental price still increased by 4% compared to the same period last year, showing a sustainable growth trend in the key industrial area.
Meanwhile, for ready-built factories, in the third quarter of 2025, the total existing supply in the Northern region reached 5.1 million m2 of leasable area, an increase of about 14% compared to the scale before the province’s merger. In addition, the market also recorded nearly 100,000 m2 of new leasing space from two projects in Bac Ninh and Hung Yen.
A notable highlight of the quarter was the occupancy rate of ready-built factories in the North reaching 87%, up 4 percentage points compared to the second quarter of 2025. This increase was particularly impressive as it coincided with the market receiving nearly 100,000 m2 of new supply, showing that demand is outpacing supply expansion, and projects with favorable locations are being absorbed quickly. In particular, Hanoi leads with an occupancy rate of 100%, followed by Hung Yen at 93%, Hai Phong at 87% and Bac Ninh at 86%. Demand mainly comes from key industries such as electronic components, circuit boards, and some traditional manufacturing industries, which prioritize the RBF model to shorten implementation time.
In terms of rental prices, ready-built factories (RBF) remained at USD 5.0/m2/month in the quarter, unchanged from Q2/2025. This stability shows that the market is in a phase of absorbing new supply in a balanced manner. However, compared to the same period last year, prices increased by 2%, indicating that the long-term price uptrend remains strong, reinforced by a solid demand foundation.
For ready-built warehouses (RBW) and mixed warehouses, after the merger of the provinces, the total existing cumulative supply of ready-built warehouses in the Northern region reached 3.4 million m2 of leasable area. This scale increased by 7.6% compared to the scale before the merger. The market recorded the entry of new supply of 18,000 m2 of leasable floor area from a project in Hung Yen.
The occupancy rate of the ready-built warehouse market in Q3/2025 reached about 77%, up 7 percentage points compared to Q2/2025. This strong growth in rental demand mainly comes from the stockpiling of goods for the year-end holidays and the steady development of the electronic components, circuit boards, traditional manufacturing and construction materials industries. With limited project scale, Hanoi, Ninh Binh and Quang Ninh provinces have occupancy rates of approximately 97% to 100%. This is followed by Hung Yen with nearly 80% and Hai Phong with 78%.
The rental price of ready-built warehouses in Q3/2025 remained at 4.9 USD/m2/month, unchanged from the first six months. However, the rental price recorded an increase of 2% compared to the same period last year.
NEW SUPPLY WILL CONTINUE TO BE ADDED
According to Ms. Trang Bui, General Director of Cushman & Wakefield, the industrial real estate market in the North is forecast to continue to grow strongly. In the period of 2025 – 2028, about 6,500 hectares of industrial land are expected to be added to the market, creating great room for development for the region. During this process, Ninh Binh is gradually emerging as a potential economic region, with two major projects about to be implemented, Dong Van V Industrial Park and Dong Van VI Industrial Park, invested by Western Pacific, providing nearly 500 hectares of new leased land.
Similarly, the ready-built factory segment will have an additional 900,000 m2 of floor space in the next three years, to meet the rapidly increasing investment wave. The shift from warehouse development to factory development shows that investors are upgrading the value chain, aiming for higher-value production activities instead of just storing goods.
For ready-built warehouses (RBW), the new supply in the Northern key economic region in the coming period is estimated to reach 800,000 m2, mainly concentrated in Bac Ninh (49%) and Hai Phong (31%) – two strategic “logistics gateways” serving import-export activities. The merger of the provinces has created a strategic lever for the ready-built warehouse segment in the North. In particular, the expanded administrative scale, combined with strong infrastructure investment policies, is a strong catalyst to optimize the distribution network, minimize operating and logistics costs. At the same time, the synchronization and simplification of administrative procedures helps remove barriers, creating favorable conditions for international investors to quickly deploy modern distribution centers. Ms. Trang Bui commented that key infrastructure projects such as the expansion of Gia Binh airport into a 4E-class international airport, along with the North-South expressway and the inter-regional road network being promoted, will become a strategic logistics axis connecting the northern industrial production chain with international seaports, contributing to improving transportation efficiency and reducing logistics costs.
“The expansion of economic zones and synchronous infrastructure investment not only optimizes the distribution network but also increases FDI attraction, especially from the technology and electronic components manufacturing industries. With that foundation, industrial real estate in the North is entering a new growth phase, aiming for larger scale, more systematic planning and a higher competitive position in the region,” said a representative of Cushman & Wakefield.
Thanh Xuan
According to Vietnam Economic Magazine (VnEconomy)