Southern Vietnam’s Industrial Market: Q4 2025 Insights

Introduction

In a remarkable shift, Southern Vietnam’s industrial market has demonstrated resilience and growth as we transition into 2026. The latest Q4 2025 Southern Vietnam Industrial MarketBeat Report by Cushman & Wakefield showcases a recovery phase after the turbulence caused by tariff pressures. This article delves into the multifaceted dynamics of industrial land, ready-built factories (RBF), and ready-built warehouses (RBW) to provide a comprehensive overview of the current situation.

Market Recovery and Demand Dynamics

Cushman & Wakefield’s Doan Chuong, Senior Manager for Industrial Leasing, observed a marked recovery in the industrial sector. Despite lingering caution among occupiers, particularly when expanding, there’s a noticeable increase in demand for strategically located industrial land and modern logistics facilities. This shift reflects how manufacturers are recalibrating their supply chains, prioritizing flexibility, cost optimization, and environmental, social, and governance (ESG) compliance.

The burgeoning activity indicates that Vietnam is positioning itself as a long-term production and logistics epicenter within regional and global supply chains.

Industrial Land Market: An Impressive Expansion

Supply Surge

The industrial land market in Q4 2025 experienced significant growth, primarily fueled by the introduction of 2,000 hectares from the initial phase of notable projects like Bau Can – Tan Hiep IP and Xuan Que – Song Nhan IP. This strategic addition heightened the total existing industrial land supply in the Southern Key Economic Zone to 36,400 hectares, marking a sharp 28% increase year-on-year.

Market Structure

Ho Chi Minh City remains the frontrunner in this sector, with a commanding 45% market share, while Dong Nai has benefited from the recent influx, making up 33% of the market. Tay Ninh follows, holding a 22% share. This distribution reveals the vital geographic distribution of industry and logistics throughout Southern Vietnam.

Existing Industrial Land Supply Overview

In Q4 2025, the overall market occupancy rate adjusted to 74% due to a significant influx of new supply, with modest net absorption of only 45 hectares. This cautious landscape signifies that businesses are adopting a wait-and-see approach regarding new land acquisitions and expansions.

Market Performance Indicators

Despite the substantial supply, the average asking rent for industrial land in the Southern Key Economic Zone rose to 185 USD/sqm/lease term, representing increases from both the previous quarter and the same period in 2024.

RBF Market: Solid Demand from High-Value Manufacturing

Supply Metrics

In the same quarter, the total accumulated supply of RBF reached approximately 6.6 million sqm of net leasable area. Notably, the demand remained vigorous, with net absorption touching approximately 73,122 sqm.

Occupancy Levels

Occupancy rates stayed remarkably high across the region, with Dong Nai leading at 94%, Ho Chi Minh City at 92%, and Tay Ninh also reaching 90%. This trend indicates the sustained interest from multinational enterprises, particularly in precision engineering and interior furnishings.

Rental Trends

RBF rental rates slightly increased to 4.9 USD/sqm/month, reflecting robust demand for high-standard factories in prime locations. This adjustment showcases the market’s response to the growth in high-quality manufacturing.

RBW Market: Rising Demand and Pressure on Logistics

In Q4 2025, the RBW market saw its total accumulated supply at 6.6 million sqm, with no new supply entering the sector that quarter. This stagnation hints at a strategic focus on maximizing existing facilities to cater to rising demand.

Demand Dynamics

Ho Chi Minh City continues to dominate as the primary distribution hub, accounting for 45% of the market. The RBW occupancy rate reached 90.72%, spurred on largely by demand from e-commerce and fast-moving consumer goods sectors.

Future Prospects

With the expected growth in RBW, approximately 622,000 sqm of new space is set to emerge by 2029. These developments aim to meet the demands of industries pushing for advanced last-mile solutions within logistics networks.

Strategic Infrastructure Developments

The development of strategic infrastructure, including networks of expressways and the Long Thành International Airport, is pivotal to the Southern Key Economic Zone’s growth. Such enhancements will improve connectivity and access to satellite logistics, facilitating smoother operations and reduced costs.

Evolving Industry Landscape

This evolution, featuring high-tech manufacturing and logistics requirements, is complemented by the emergence of green industrial models. By integrating ESG principles with modern logistics capabilities, Southern Vietnam is transforming its industrial landscape into a sustainable and competitive hub for foreign direct investment.

In summary, the Southern Vietnam industrial market stands at the cusp of significant transformation, blending resilience with strategic innovations aimed at fostering sustainable growth in the years to come.