In the first half of 2023, Hai Phong 's gross regional domestic product (GRDP) increased by 9.9%, 6.2 percentage points higher than the national average; Hai Phong ranked third nationwide and first in the Red River Delta. By 2025, Hai Phong is expected to account for 6.4% of the country's GDP, up from 3.9% in 2022.
As of the second quarter of 2023, Hai Phong has attracted foreign direct investment (FDI) of 1.98 billion USD, up 80% year-on-year. By the first 6 months of 2023, Hai Phong had 480 FDI projects in industrial parks and economic zones with a total investment capital of 24.85 billion USD, notable investors include LG (Korea), Bridgestone (Japan),... The increase in FDI and investment projects in Hai Phong will create demand for low-cost housing projects for workers and experts.
Hai Phong ranked 3rd nationwide in the PCI 2022 ranking, just behind Quang Ninh and Bac Giang. The city's PCI reached 70.7 points. PCI maintains a high score reflecting a favorable business environment and future investment potential.
Notably, Hai Phong has been actively investing in infrastructure to boost the province’s competitiveness and economic growth. Ongoing and planned projects include highways, ring roads, ports and bridges. Total public investment in 2023 is expected to exceed VND22 trillion (US$929 million). In the first half of 2023, Hai Phong disbursed VND8 trillion (US$338 million) and construction of Terminal 2 of Cat Bi International Airport will begin in the fourth quarter of 2023. By 2025, the airport will serve 8.5 million passengers per year and 13 million passengers per year by 2030.
In addition, Hai Phong's current retail density is 0.08 m2/person, behind major urban centers such as Hanoi (0.32 m2/person), Ho Chi Minh City (0.16 m2/person) and Da Nang (0.10 m2/person). In the second quarter of 2023, retail occupancy at 15 projects in the city increased by 2 percentage points to 79% with an average ground floor rent of VND741,000/m2/month.
Office supply from Grade B and C projects increased by 4% compared to the same period in 2022; average growth was 2%/year from 2019 to the first half of 2023. Office occupancy reached 91% and rental price reached VND238,000/m2/month. Ms. Do Thu Hang, Senior Director, Research and Consulting, Savills Hanoi commented: “Hai Phong's growing economy and increasing foreign direct investment have led to the development of high-end office projects accompanied by increasing demand for premises in the city center”.
In addition, the supply of 3-5 star hotels reached more than 3,000 rooms. 5-star hotels accounted for 58% of the market share with 7 projects. Occupancy increased by 7 percentage points year-on-year and the average price reached 1.8 million VND/room/night, stable year-on-year.
In addition, thanks to the dynamic industrial market, Hai Phong has formed a serviced apartment market. The Sunflower International Village invested by LG International was the first project to open in 1998. The supply of apartments in this port city reached 1,500 units, second only to Hanoi in the North. The city continues to receive good FDI capital flows, contributing to attracting more foreigners to work, thereby boosting the demand for serviced apartments. It is observed that from the second half of 2023 onwards, 113 serviced apartments will enter the market from two projects, both of which have international brands.
Apartment supply reached 11,969 units from 11 projects, up 5% YoY, 1% higher than Hanoi. From the second half of 2023 onwards, there are expected to be 25,100 new apartments. Thuy Nguyen will account for 56% of future supply thanks to its large land fund and industrial parks here including Nam Cau Kien and VSIP Hai Phong. The supply of townhouses in Hai Phong reached 6,774 units, up 5% YoY. Le Chan District has the largest supply, accounting for 33%.
Ms. Hang assessed that housing demand will continue to increase, greatly influenced by the development of industrial parks along with the recovery of the workforce, the growth of foreign direct investment and infrastructure improvements. As the city expands, demand for the commercial and accommodation markets will also increase. This creates conditions for investors and developers to exploit the real estate market in Hai Phong. The fields are very diverse and attract investment participation from the development of logistics services, ports to investors of housing projects looking for emerging segments such as worker housing.
Meanwhile, according to other experts, Hai Phong real estate still has a lot of room for growth and breakthrough. According to Mr. Nguyen Van Dinh, Chairman of the Vietnam Association of Real Estate Brokers (VARS), to increase the attractiveness of this market, it is necessary to perfect the legal system, minimize administrative procedures, and procedures for granting investment licenses for real estate projects in the area to stabilize selling prices, thereby helping real estate businesses feel more secure when investing here. All planning information must be made public and widely announced to the people. Any changes in planning information must be updated as quickly as possible, thereby helping the market to be transparent and minimizing virtual land fever that can cause many consequences. In particular, Hai Phong should also prioritize social housing land funds as well as have stronger policies to attract tourism real estate products./.
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