Vietnam North prime logistics supply to grow substantially in H2 2025

Over 920,000sqm of new stock is expected to enter the market.

The Vietnam North prime logistics market is set to see significant growth in late 2025 according to a JLL report, adding about 922,000 sqm of new space in H2 2025. Alongside new developments from key developers BWID, KCN Vietnam, LOGOS, SLP, and Sembcorp, the region will welcome newcomer MEA through project Logicross Hai Phong.

“US reciprocal tariffs and ongoing provincial-city mergers will continue influencing market conditions, promoting caution among investors and tenants. While demand remains soft near-term, gradual recovery is expected by late 2025. The confluence of substantial new supply and economic uncertainty will challenge leasing activity, likely reducing occupancy rates,” the report said.

Here’s more from JLL:

The market continued to expand strongly with over 233,000 sqm of new Modern RBW spaces, bringing the total stock to 1.47 million sqm as of H1 2025.

This was contributed from LOGOI Hung Yen, KCN Deep C Phase 2, KCN Thuan Thanh 3B (RBH area), and notably, the project DPL Vietnam Minh Quang in Hung Yen – a project from a collaboration between WHA Group and Daiwa House marked the first logistics facility of these two developers in the Northern region.

Demand slows down in the short term, net absorption experiences a modest level

In H1 2025, the market has slowed down, particularly in the second quarter, reflecting challenges of volatile global economy, particularly due to the US reciprocal tariffs information. Both investors and tenants adopt a cautious approach, taking a wait-to-see stance towards ongoing negotiations with the US.

Net absorption reached about 62,000 sqm, recording a modest level compared to the last period and the same period last year. Leasing activity faced challenges, the vacant spaces up to 21.3%, mainly due to the abundant new supply entering the market that needs time to be absorbed.

Rental rates show a modest increase, primarily attributed to higher pricing in newly completed developments

The average rent went up by 2.79% h-o-h, reaching USD 4.76 per sqm per month.

This growth was mainly attributed to the premium rates of newly launched properties which command asking rents ranging USD 5.0 – 5.5 per sqm per month.