Why Has Minh Hung Sikico IP Attracted So Many Big Investors?

10:01:04 AM | 2/1/2021

Vietnam is seeing a new wave of industrial real estate, strongest in 25 years. In this trend, the "hot" topic in the current real estate market is "What do industrial real estate developers need to have to entice large investors?”

The year 2020 witnessed a strong emergence of southern “industrial hubs” such as Binh Phuoc, Tay Ninh, and Vinh Long thanks to a vast land bank and competitive rental as compared to those in HCM City, Binh Duong, and Long An.

While seeing a lot of opportunities, localities as well as industrial parks must make careful preparations for policies, infrastructure and services to welcome foreign investors who have strict requirements and complicated appraisal procedures.

The perspective of Minh Hung Sikico Industrial Park

Well-planned clean land, synchronous connection and regulatory transparency

Currently, the land fund in older industrial hubs such as Bac Ninh and Hung Yen in the north and Ho Chi Minh City, Binh Duong, and Dong Nai in the south is shrinking and rentals are rising. This scarcity is creating a great difficulty for investors looking for large land plots to match their production scale.

In particular, when deciding to relocate their production facilities to Vietnam, big investors will not go alone but with their entire supply chain ecosystem. Taking Samsung as an example, the investment shift of this "queen bee" has brought hundreds of foreign suppliers to Vietnam. Therefore, industrial park developers must have a well-planned large, seamless land fund to accommodate a variety of industries to embrace an ecosystem that goes with lead investors.

Moreover, these investors, when entering the Vietnamese market, have a long-term vision. An expansible land bank is also a requirement to secure their future factory expansion plans.

Therefore, new industrial zones which lie not too far from the centers, have a large seamless land fund, and offer many different options receive the attention of many investors.

Recently, Japfa Comfeed Vietnam - a member of Singapore-based Japfa Limited - decided to invest in Minh Hung Sikico Industrial Park in Binh Phuoc province. This is a series of animal and fish feed production factories, farms, pork and poultry slaughtering and processing facilities, costing US$230 million or more than VND5,300 billion. As a new industrial park (started to open to investors from the first quarter of 2021) with a large land fund of the first phase (655 ha), Minh Hung Sikico Industrial Park easily meets Japfa's demand for large one-piece land for building adjacent factories in the early phase.

Along with an abundant land fund, the ability to accommodate different industries like clean industries, supporting industries, generating waste gases and wastewater industries is creating competitive advantages for Minh Hung Sikico Industrial Park to become the No. 1 priority for investors seeking to locate their supply chain systems.

With the advantages of large land funds, infrastructure, especially the wastewater treatment system with a capacity of 25,000 m3 / day-night for phase 1, many healthcare equipment (gloves)  investors are looking for land in Minh Hung Sikico industrial park to quickly build factories to serve the growing export demand during covid-19.

Besides, a complete legal status and a separate ownership certification for each land plot are different advantages of Minh Hung Sikico Industrial Park over its peers. Tenants will easily find solutions of financial leverage and ease off pressures on an investment fund.

Support from the developer

What concerns investors most when deciding to invest in a new locality are the legal corridor, the time to complete administrative procedures, worker recruitment and vendor/supplier availability. Not being advised by knowledgeable experts, investors will encounter many difficulties and need much time to prepare for running a new business.

Tenants are supported by the “one-stop service” of Minh Hung Sikico

Understanding these concerns, when investing in Minh Hung Sikico Industrial Park, tenants will be supported to quickly complete all procedures for applying for investment certificates, business registration licenses and corporate seals in the “one-stop service” mechanism. As a bridge for tenants and local authorities, the developer always tries its best to support investors from the very beginning of business operations and quickly solve operating difficulties.

Supportive local policies

Despite their optimistic views on the Vietnamese investment environment, global corporations are still concerned about some risks. At a dialogue between the Vietnamese government with Japanese businesses on December 21, a number of shortcomings, especially prolonged administrative procedures and complicated tax policies, were raised. Some projects had to wait more than one year to receive investment registration and land use-right certificates. The time was even longer if projects were licensed by central authorities.

Therefore, besides the efforts of the industrial park developer, the dynamism of the local government is also a pivotal factor to successfully attract investment fund flows. Among them, Binh Phuoc province is one of the “rising stars” of FDI inflows thanks to breakthrough administrative reforms and many tax incentives for businesses.

With the motto “The success of the business is also the success of the province”, the government of Binh Phuoc is making efforts to reduce the time for handling administrative procedures and apply the interconnected one-stop service of receiving and settling applications and procedures at the public administrative center, thus the needed time reduced to a third of the regulatory time of the central government.

Tenants in Binh Phuoc province-based industrial parks are offered tax incentives. For example, the corporate income tax is 17% in 15 years since the first revenue is generated, the tax is exempted in two years since the business becomes profitable and the preferential tax rate of 8.5% is applied in the next four years. The provincial government also reduces 25% of deposits to ensure project implementation and apply tax exemption and reduction according to regulations.

Binh Phuoc Investment Promotion Conference on December 23, 2020

As a result of these positive efforts, more investors have chosen Binh Phuoc province as the location for business investment and development. Recently, 


Website: www.minhhungsikico.vn

Hotline: 0981 555 777

Address: Hamlet 5, Dong No Commune, Hon Quan District, Binh Phuoc Province

at the Binh Phuoc Investment Promotion Conference on December 23, in the presence of Standing Deputy Prime Minister Truong Hoa Binh, the Provincial People’s Committee awarded investment registration certificates to 35 companies with 46 projects with a total registered investment fund of nearly US$2 billion. In particular, Minh Hung Sikico Industrial Park attracted 11 projects.

With good planning, complete legality and professional business support, and investment incentives of the province, Minh Hung Sikico Industrial Park is an ideal destination for many investors.

B.H (Vietnam Business Forum)