Vietnam logistics property may grow faster compared to SE Asian peers
Vietnam logistics property may grow faster compared to SE Asian peers
Glenn Hughes, head of LOGOS Vietnam Logistics Venture, told Hanoitimes about his company's opportunities and plan to contribute to the modernization of Vietnam's logistics property sector.
How do you see the impacts of Covid-19 on the logistics property industry in Vietnam? Why did the company decide to establish the new Vietnam Venture in the midst of the Covid-19 pandemic?
Glenn Hughes, head of Logos Vietnam Logistics Venture
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LOGOS spent a number of years assessing the viability for us to enter the Vietnam logistics property market. Given the long term economic fundamentals and growth potential in the Vietnam logistics market, combined with the current and future demand indicated by our customers, we determined there is now a significant opportunity for our company to enter Vietnam to deliver modern logistics solutions for our customers and for us to play an important role in modernizing the Vietnam logistics property sector.
We also recognize that Vietnam has led a successful response to the Covid-19 pandemic and is well positioned to rebound for future economic growth. Demand from our customers remains strong and is driven by expansion of e-commerce and expansion in manufacturing which are both showing signs of growth in Vietnam during the Covid-19 period. In this context, we look forward to delivering international quality modern and efficient logistics facilities to our customers over the next year and beyond.
What's your comment on the scale and potential of the logistics property industry in Vietnam in comparison with other Southeast Asian countries?
Much of Southeast Asia, outside of Singapore, is an emerging market where logistics property sectors are expanding. So, in principle, most markets are evolving and growing at the same time. However, due to a number of locational aspects and structural changes in global supply chains, we believe that Vietnam may grow faster compared to other Southeast Asian economies over the medium term, and the logistics property industry is expected to grow strongly in Vietnam as the wider economic grows and as the logistics industry modernizes.
A e-commerce company's warehouse in Vietnam. Photo: Tiki
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How would the e-commerce industry impact the logistics and industrial property sectors in Vietnam?
We believe the current pandemic has propelled e-commerce five to 10 years ahead of where we would have been without Covid-19. There has been a significant increase in online sales in Vietnam and across the region and this long-term structural change in consumer behavior has significant impacts on supply chains, forcing our customers to look for longer term solutions to meet their customer demand in food, cold storage, pharmaceutical and across the whole supply chain.
Given this accelerated growth, we see e-commerce as a key driver of the growth and modernization in the Vietnam logistics industry, particularly given the importance that e-commerce operators place on technology-driven efficiencies which we can deliver.
As a foreign investor, what challenges do you think Vietnam's property logistics industry has faced?
The need to secure good locations for logistics property near urban areas but with proximity to key ports and airports means that finding suitable land is a major challenge, particularly when there are ongoing regulatory and practical challenges for both government and private sector developers to bring forward new logistics land supply.
Sutong Science And Technology Park, Nantong, JS
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Which criteria will the venture choose to acquire customers from the sectors of e-commerce, food and beverage, and cold storage in Vietnam?
We have a strong history of providing logistics property solutions for customers operating in e-commerce, food& beverage and cold storage. We intend to work with customers in Vietnam across all of these sectors as we develop our portfolio of modern high-quality facilities to meet their needs.
We will seek to work with both international and local customers who have demonstrated they have a good history of success and solid plans for future growth – including plans for adopting new technology in new modern facilities which will assist them to drive efficiency improvements.
What are your plans for the venture in 2021?
In Vietnam we are adopting a business plan based on building up a strong portfolio of modern logistics facilities to serve the Greater Hanoi - Hai Phong corridor and the Greater Ho Chi Minh City -Vung Tau corridor and this will continue to be our priority in 2021. During 2021 we also anticipate increasing our focus on seeking project opportunities to serve the Greater Danang/Central Vietnam area.
We look forward to actively advancing several construction projects during 2021 to match the demands of our customers, as well as confirming we have secured new lands for additional future projects.
Thank you for this interview with Hanoitimes!
