Understanding the common types of land in Vietnam is an important factor that helps investors optimize current capital and increase profits. Standing out among the types of land that cannot be ignored, surely businesses are interested in what industrial land is and what its investment potential is. Let the following article from KTG Industrial answer all questions in detail, from which you can make the optimal choice.
What is industrial land?
Industrial land is a type of land reserved for the construction of industrial parks (or export processing zones, industrial clusters, concentrated production and business areas, …) and has a direct impact on the Vietnamese economy. Because on this land, investors can produce and distribute goods.
The important criteria for any land to become industrial land is to possess abundant raw materials, necessary for the production process or convenient traffic location, helping to transport products to agents (or customers) quickly.
Industrial land is land to build factories, industrial parks,…
Key factors of industrial land
You can distinguish industrial land from other types of land by the following highlights:
- Land for industrial production always has clear geographical boundaries, absolutely does not encroach on residential land (land for housing) or agricultural land (for the farming industry).
- This land is often completely separate from residential areas to limit the impact on daily life.
- An industrial land area can include many industrial parks and factories.
- The scale of industrial land is very large, potentially up to tens of thousands of hectares.
- Most businesses with production facilities on industrial land are in the fields of industrial goods, machinery, software, consumer goods, etc.
The role of industrial land today
In addition to strong economic development for the country, we cannot deny the other important roles of this type of land. Specifically as follows:
- Supporting the state to solve the employment needs of a large number of workers, in many different age segments.
- Supplying raw materials must be stable all year round so that the production of goods is not interrupted.
- Help produce enough essential goods, meeting the necessary needs of the people in the country.
- Create close relationships with other countries by attracting foreign investment.
Industrial land develop Vietnam’s economy
Types of industrial land in Vietnam
Here are some common types of industrial land that business owners should know:
Export processing zone
This is a land area specialized in manufacturing and processing products for export abroad. For example, Tan Thuan Export Processing Zone (District 7, Ho Chi Minh City) with an area of 300 hectares, specializes in manufacturing in the textile, electronics, machinery, packaging, etc. industries.
All facilities are managed and operated according to the provisions of Decree 82/2018/ND-CP, including environmental, tax and planning conditions. Normally, here, businesses have the opportunity to enjoy many benefits in terms of taxes, land rental prices, infrastructure, etc. In addition, this area is often uninhabited.
Complex
The complex is a location that allows businesses to proactively connect and cooperate with each other easily. Thereby, they can conveniently exchange technology, techniques, raw materials, etc., helping to minimize the production process and time. This is completely beneficial for both sides, especially in terms of economics.
Accordingly, Hoa Phat Dung Quat Steel Complex is implementing this form of industrial land, including a collection of iron or steel smelting factories in parallel with the necessary works to serve production.
Hoa Phat Dung Quat is a famous iron and steel production complex nationwide
Multi-industry mixed industrial park
This is a type of industrial land with the presence of many different enterprises. The units may not be in the same field but do not negatively affect each other’s development.
For example, Hiep Phuoc Industrial Park specializes in port services, logistics and daily waterway transportation operations.
Specialized general industrial park
Specialized general industrial park is where enterprises belong to one (or several) specific production fields. They together produce and distribute products to agents/consumers or export to foreign countries. For example, a specialized oil and gas industrial park often has oil exploitation and production units, coal exploitation and production units, etc.
Advantages of investing in industrial land
In general, real estate investment is always the priority choice of many people because it brings many impressive benefits (especially the ability to make quick profits). This is similar to industrial land.
Here are some undeniable advantages when investors choose to “invest” in a piece of land for an industrial purpose:
- It is possible to develop a variety of forms of land leasing on the current industrial land such as leasing to build factories, leasing to build warehouses, leasing land to open boarding houses, etc.
- Improving the value of the land stably over time thanks to regularly upgraded infrastructure, convenient location, etc.
Investing in industrial land properly can bring great profits
Some difficulties when approaching and investing in industrial land
Although industrial land has the potential to generate “huge” profits, those who approach this type of land for the first time may encounter the following problems:
- Investing in the wrong industrial land without clear planning information, leading to disputes.
- The land lease/ownership handover documents are incomplete or this handover process is not transparent enough.
- It is not possible to predict the development potential of the land.
Industrial land plays an important role in promoting economic development and industrialization. Understanding the concepts, characteristics and regulations related to this type of land helps businesses and investors make accurate decisions, optimize resources and limit risks. If you are looking for suitable industrial real estate solutions such as finding factories, workshops to rent, or building on demand, please contact us for detailed advice.
