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Thai developer eyes building 2 industrial parks in Vietnam

Posted: 09 May 2016 ?? ?Print Version ?Bookmark and Share

Keywords:industrial parks? Vietnam? Nghe An? industrial estate utilities? developer?

Thailand's industrial real estate developer Hemaraj Land and Development PLC is looking to develop two industrial parks in Vietnam's central province, several local media outlets have reported.

Last week, Hemaraj representatives met with officials of the provincial government of Nghe An to discuss "site clearance fees as well as long-term plans over site clearance and investment application procedures," according to the Vietnam Investment Review.

The developer, which has formed a consortium with Civil Engineering Construction Corp. No. 4 (Cienco 4), is planning to build the 2,000-hectare WHA Hemajai 1-Nghe An IP in Nghi Loc district and the 1,160-hectare WHA Hemajai 2-Nghe An IP in Dien Chau districtboth located in the province's Dong Nam economic zone.

Hemaraj currently owns eight industrial parks with a combined area of over 7,000 hectares in Thailand. It also holds numerous factories for rent.

The company's business involves acquiring land and providing industrial estate utilities, including electricity substations, site grading, roadways, and gas pipelines. Early this year, its power arm Hemaraj Energy signed a memorandum of agreement with Gulf MP to co-invest $936.6 million in develop five small-sized co-generation power plants in Thailand's Eastern Seaboard with a total capacity of 630MW.

Aside from Hemaraj, Amata Corp PLC is the only other Thai industrial park developer that operates in Vietnam. Amata opened its first part in the southern province of Dong Nai in 1994 and is expected to open its second complex in the same province next year.

Thai businesses were believed to be the most active investors in Vietnam since the ASEAN Economic Community (AEC) took effect in late 2015. According to a report from the Foreign Investment Agency, Thailand has registered 20 new projects and expanded six more in the country during the first eight months of 2015. As of August, Thailand already has a total of 399 foreign direct investment projects in Vietnam.

However, industrial parks are considered to be a hit-or-miss business in the country. Government figures showed that not all manufacturing hubs in Vietnam manage to be successful. The country currently has 299 industrial parks, but only close to 71 per cent were operative as of September and had 67 per cent of their space filled up on average. In comparison, many industrial parks in central provinces such as Binh Thuan, Ninh Thuan and Ha Tinh had less than 30 per cent of their space filled up.

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