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|My Phuoc 4 Industrial Park will cover around 240,000 square metres in Binh Duong province|
ESR will work with BW on the leasing of the park, leveraging its strong roster of customers.
My Phuoc 4 Industrial Park, which will boast approximately 240,000 square metres of logistics and light industrial facilities upon completion, is located north of Ho Chi Minh City in the strategic Binh Duong market, a leading hub of industrial development in the south.
“We are excited to cooperate with BW on the development and management of high-quality logistics and light industrial facilities in this prime location, given BW’s leading presence and reputation in the market. We view Vietnam as an important market in ESR’s strategy and we look forward to welcoming our customers to My Phuoc 4,” said Dr. Michael de Jong-Douglas, senior managing director of ESR.
Lance Li, CEO of BW said, “E-commerce is a very important positive tailwind that drives the demand for logistics real estate in Vietnam. We are very delighted to work hand-in-hand with ESR, leveraging our collective relationships, experience, and track record in development and management to capitalise on the opportunity for this project”.
ESR is the largest logistics real estate platform by gross floor area (GFA) focused on Asia-Pacific and by value of the assets owned directly and by the funds and investment vehicles it manages. The ESR platform spans major economies across Asia-Pacific, including China, Japan, South Korea, Singapore, Australia, and India.
As of the end of last year, the fair value of the properties directly held by ESR and the assets under management with respect to the funds and investment vehicles managed by ESR recorded approximately $30 billion, and GFA of properties completed and under development as well as GFA to be built on land held for future development comprised over 20 million sq.m in total.
Meanwhile at the beginning of 2021, BW announced its hyper-growth strategy to roll out institutional-grade factories and warehouses for lease in Vietnam, pillared on a strong belief in the country’s tremendous consumption growth, modern retail, and e-commerce growth, combined with growing trade activities with considerably higher growth versus other countries within the region.
Development wise, the product mix includes ready-built factories, logistics warehouses, or both, tailored to tenant demand in each region, combined with large-scale multi-storey products to maximise GFA in core locations.
At present, BW employs a tried-and-true development formula that has proven successfully across Asia-Pacific. The development cycle is from 12-18 months, including land sourcing, design, construction and project management, leasing, and stabilisation.
Jeffrey Shen, ESR co-founder and co-CEO said, “Vietnam’s industrial and logistics real estate is coming of age. It is one of the most promising markets within Southeast Asia, benefitting from a range of favourable macroeconomic factors. We are most pleased to make our first foray into the Vietnamese market with this meaningful joint venture with BW, which sets a strong foundation for our growth plans in the country.”
Li also expressed excitement about the joint venture. “As the Vietnamese industrial and logistics property sector is entering a strong cycle of growth, BW is focused on continuing to be a pioneer in the market and accelerating our growth trajectory on the back of both greenfield developments, acquisitions, and joint ventures. We believe that the firm is well positioned to capture the increasing opportunities as the demand for industrial spaces continues to grow.”
With its best-in-class response to the pandemic and strong economic growth in comparison to elsewhere last year, Vietnam is embracing global supply chain movements following the footsteps of many major investment brands. Furthermore, the Regional Comprehensive Economic Partnership gives Vietnam advantageous access to a market of 2.2 billion consumers and a total GDP of $26.2 trillion – accounting for around 30 per cent of global GDP.