According to research from Savills, the cold storage market is one of the exciting options for investors when attracting $ 4,9 billion bongdaso con investment capital on a global scale.
Soaring demand bongdaso con Asia
bongdaso con Savills' recent Asia-Pacific cold storage report, the cold storage market accounted for only 11,4% of industrial real estate transactions, but this sector has record growth rate of 29,6% from 2017 to 2022, exceeding other forms of industrial real estate.
The main growth drivers of cold storage are the growth of household income, the increase bongdaso con urban population and changing consume habit of middle class.
Specifically, the shopping habits of consumers have gradually shifted to fresh food with high quality as income increases. Old habits like shopping at a traditional market have switched to the supermarket with diversified products and convenient preservation.
Another driver is e-commerce, according to Mr. Thomas Rooney, Senior Manager of Industrial Services at Savills: “During the pandemic, e-commerce and online shopping for essential goods have been bloomed with an average global e-commerce penetration rate of 22%. Notably, China and South Korea are the two countries with the highest e-commerce penetration rate bongdaso con the world with 27%. bongdaso con emerging markets such as Southeast Asia, the main consumer group is mostly the young population, which is expected to achieve a growth rate of e-commerce penetration rate of about 17% bongdaso con the period 2022-2026.
bongdaso con addition, the pandemic has also boosted demand for stocks of vaccines, pharmaceuticals, and other medical products. With the Asia-Pacific market being a newly developing market, some prominent countries such as China, India, Japan, Korea, Australia. bongdaso con which, India has the highest total cold storage capacity globally with 150 million m3, followed by China with 105 million m3, Japan with 38 million m3, according to a report from GCCA (Global Cold Chain Alliance).
However, the supply has not yet met the demand, the average cold storage volume available per capita bongdaso con the main Asian markets is at 0,03 – 0,5m3 bongdaso con 2018. This is much lower than the US or UK market when it is 0,49 m3 and 0,44 m3 respectively.
To be equivalent to the US and UK markets, the amount of storage volume that the Asia-Pacific market needs to compensate for is 325 million m3. Currently, cold storage supply bongdaso con this market is fragmented compared to developed markets (USA, UK, Australia) at 100 000 m3 average cold storage capacity, when India is at 15 000 - 25 000 m3.
According to Savills’s report, the shortage of supply will remain bongdaso con the short and medium term, which means that the occupancy rate of cold storage will be higher, rental price will increase, creating attractive investment opportunities.
Potential from cold storage real estate bongdaso con Vietnam
For Vietnam, the report of Savills said that the revenue of the fresh food industry increased by 6,3% bongdaso con the period 2020 - 2022, equivalent to USD 40,4 billion to USD 45,7 billion.
bongdaso con addition, Vietnam's e-commerce industry also has a fast growth rate from 2017 to 2022 at 21,5%, boosting additional services expansion. For example, online food delivery has a growth rate of 5,5% from 2020 to 2022.
Vietnam's cold storage market, like other markets bongdaso con Asia-Pacific, is developing with a small scale, by 2022 there are 40 projects with a total area of 460 000m2. The southern market recorded more dynamic growth, which stem from demand for food, seafood, and retail products. The main feature of Vietnam's cold storage market is its concentration bongdaso con big cities.
Cold storage supply is mainly concentrated bongdaso con Ho Chi Minh City, Binh Duong, Long An and Dong Nai when accounting for 87% of the national supply. For the Northern market, the main markets including: Hanoi, Bac Ninh, Hung Yen have significantly increased supply recently but the proportion is still quite small compared to the Southern market.
bongdaso con terms of cold storage rental rates, Ho Chi Minh City currently has a price nearly double of other markets due to better facilities and a variety of value-added services.
“The average rental price of cold storage bongdaso con Vietnam is currently from 22 USD/ton/month (Bac Ninh) to 50 USD/ton/month (HCMC), domestic enterprises hold most of the cold storage supply. Some foreign enterprises such as: Lineage Logistics, SK Logistics, Lotte Logistics are actively investing bongdaso con their own storage systems bongdaso con Vietnam. Still, the supply haven’t met with the demand” said Mr .Rooney.
The occupancy rate of cold storage is currently at 88% by the end of 2022, especially some markets such as Ho Chi Minh City, Binh Duong, Long An, Bac Ninh have occupancy rates of over 90%.
Assessing the development potential of the cold storage market, Mr. Rooney noticed some key characteristics as follows:
- Changes bongdaso con consumer buying habits will be the main driving force of the market
- Currently, the Asia-Pacific market has barriers bongdaso con terms of appropriate infrastructure and technology, so it continues to receive support from the government through policies and subsidies.
- Cold storage often requires new technology, automation system, complex operating system, large investment and cost, long payback period, strict regulations and licensing process. Therefore, investors bongdaso con cold storage often have experience and financial capability.
“Investors also need to identify risks such as possible operational problems, economic volatility and falling yields bongdaso con order to better capitalize on the opportunities that the cold storage segment offers. Based on my experience bongdaso con supporting tenants and investors bongdaso con the cold supply chain, I believe that well-invested, well-designed, prime locations and optimized operating costs will outperform conventional competitors, thereby attracting more transactions and investments from larger businesses bongdaso con the future" added Mr. Rooney.
Source: https://dangcongsan.vn/cung-ban-luan/bat-dong-san-kho-lanh-co-hoi-dau-tu-trong-nganh-cong-nghiep-luu-tru-va-logistics-642171.html
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