HCMC logistics set to bloom

HCMC logistics hub

Ho Chi Minh City’s strategic location close to China, in particular to Kunming, and access to an improving Saigon port infrastructure, is giving this city great potential for growth.

Real estate firm CBRE in its Asia-Pacific Logistics 2030 Hub report, identified the Saigon Hi-tech Park, a ten-hectare logistics project, as one example that will help complete the supply chain around Ho Chi Minh City, thus improving its regional competitiveness.

To compile the report CBRE developed a new model for ranking the region’s logistics hubs based on primary demand drivers: infrastructure developments, market demand and the business environment. The report categorizes hubs as global, regional or local.

The report revealed that Asia Pacific’s global hubs share strong similar characteristics, while improvements in infrastructure, stronger population growth – particularly in China – and additional trade agreements between nations are helping to normalise the differences between these global hubs, making them more equal in logistics importance.

Based on the CBRE logistics hubs model, there are currently eight logistics hubs in Asia-Pacific ranked as global – Greater China’s Hong Kong, Guangzhou, Shanghai, Shenzhen, Tianjin; Japan’s Tokyo, Osaka-Kobe; and Singapore. The report found that these hubs will continue to dominate in the years leading up to 2030 however, other emerging regional and local hubs such as China’s Chengdu, Fuzhou, Hangzhou, Ningbo; India’s Delhi, Mumbai; South Korea’s Busan and Vietnam’s Ho Chi Minh City are also growing in importance due to the shift in low-end manufacturing, rising consumption power, infrastructure and policy developments.

“We expect the current dominant global hubs to remain strong in 2030,” said Dennis Yeo, Managing Director, Industrial & Logistics Services, CBRE Asia.

“The drivers of infrastructure, market demand and the business environment are expected to remain robust in these hubs. These hubs are located along the major trade corridors, connected to major international transportation networks, contain large amounts of prime logistics space and have a variety of sophisticated logistics operators.”

Dr. Henry Chin, Head of Research, CBRE Asia Pacific, added: “Long-term demand for logistics remains solid—identifying these logistics hubs is important for occupiers, developers, and investors alike.”