FDI POURED INTO REAL ESTATE SECTOR DOUBLES

Real estate sector attracted 3.5 billion USD in foreign direct investment (FDI) the first nine months of this year, accounting for mearly 19 percent of total FDI that the country lured in the period, coming second among sectors in terms of FDI attraction.

According to Foreign Investment Agency under the Ministry of Planning and Investment (MPI), as of September 20, registered FDI totalled 18.7 billion USD, down 15.3 percent year on year.

The figure includes 7.12 billion USD poured into 1,355 new projects, respectively falling 43 percent and rising 11.8 percent. More than 8.3 billion USD was poured into 769 existing projects, up 29.9 percent and 13.4 percent, respectively. Meanwhile, foreign investors spent over 3.28 billion USD on purchasing shares in Vietnamese companies, up 1.9 percent.

Experts from real estate firm Savills Vietnam held that along with the country’s economic growth, the real estate sector has eyed great development opportunities.

According to Savills Vietnam, some factors have positively impacted on the country's industry, such as the early application of policy to open the border that has created favourable conditions for foreign firms to work in Vietnam, and great advantages from free trade agreement, especially the EU-Vietnam FTA, making it more attractive to foreign enterprises.

Savills Vietnam also pointed to other factors that make Vietnam a safe investment destination for investors, including the stability in VND/USD exchange rate.

Statistics from Savills Vietnam showed that in September, the supply of industrial real estate in Hanoi and Ho Chi Minh City were almost completely filled. With the advantages in infrastructure and transport, industrial real estate in the two biggest cities of Vietnam are more competitive.

Savills Vietnam also noted that the Vietnamese Government has given directions for the development of the sector and added more real estate supply across the country.

In the first half of 2022, the construction of nine new industrial parks were approved and they are scheduled to be put into operation in the 2023-2025 period with total area of 2,472 hectares and total investment of 29.4 trillion VND. In Hanoi alone, 2-5 industrial parks have been approved to be built in the 2021-2025 period in outskirt districts.

However, Deputy Minister of Planning and Investment Nguyen Thi Bich Ngoc said that in order to attract more investment in the sector, it is necessary to deal with problems in ground clearance and land rent.

Source: VIR