In the most significant administrative restructuring in a decade, Vinh Phuc* – one of Northern Vietnam's most dynamic industrial hubs – is entering a transformative phase as it officially merges with Phu Tho and Hoa Binh to form the new Phu Tho province. This move is more than an administrative decision; it is a strategic catalyst set to unlock a new chapter of growth for the industrial real estate market in the Northern Midlands and mountainous region.
Boasting a prime location adjacent to Hanoi, just 30 km from Noi Bai International Airport, and directly connected to key arterial routes like the Noi Bai–Lao Cai Expressway, National Highway 2, and Ring Road 5, Vinh Phuc has long been an ideal destination for manufacturers. Now, as the industrial core of the newly formed Phu Tho province, it solidifies its role as the "industrial gateway" to the Northwest, offering a powerful convergence of infrastructure, human resources, favorable policies, and significant room for growth.
Even before the merger, Vinh Phuc had already proven its potent investment appeal. According to a Q2 2025 report by Cushman & Wakefield, the province's total industrial land supply reached approximately 1,630 ha with a healthy occupancy rate of 66%. Its average primary asking rent stood at USD 131/sqm/lease term — a figure substantially lower than Hanoi (180 USD) and highly competitive with major industrial centers like Bac Ninh (162 USD) and Hai Phong (142 USD). This presents a clear advantage as global enterprises increasingly prioritize cost-efficiency in their investment decisions.
(Source: Cushman & Wakefield, data recorded prior to the administrative boundary adjustment of provinces and cities on July 1, 2025)
The province's ready-built factory (RBF) market is also experiencing rapid growth. With an accumulated supply of over 636,000 sqm, a 76% occupancy rate, and an average rent of just USD 4.9/sqm/month, Vinh Phuc is an ideal choice for small and medium-sized enterprises seeking flexible, cost-effective production solutions without compromising on infrastructure quality. This compares favorably to Bac Ninh's rent of USD 5.1/sqm/month (over 1 million sqm supply) and Hai Phong's USD 5.24/sqm/month (1.53 million sqm supply), while Hanoi commands the highest rent at USD 5.74/sqm/month for a limited supply of just 125,700 sqm. Vinh Phuc stands out for its abundant land bank and the rapid expansion capabilities of its well-capitalized developers.
(Source: Cushman & Wakefield, data recorded prior to the administrative boundary adjustment of provinces and cities on July 1, 2025)
According to Cushman & Wakefield's Q2 2025, CNCTech Industrial currently holds the largest supply of factory space in the province, with 700,000 sqm of operational floor area and a projected expansion to 2 million sqm by 2026. Key projects include CNCTech Ba Thien 1 Industrial Center, CNCTech Thang Long 3 Commercial Complex, and Nam Binh Xuyen Industrial Park (Green Park).
These projects are distinguished by their rapid delivery times of just 90 to 160 days. The CNCTech Ba Thien 1 Industrial Center is a prime example, being one of the few industrial parks in the North to offer high-rise factories (1-5 stories) with high-load-bearing floors (up to 4
tons/sqm) and international-standard fire protection systems. This infrastructure is specifically designed for high-tech industries such as electronics, semiconductors, robotics, and automation.
"We not only develop high-quality industrial infrastructure but also integrate modern technology to minimize environmental impact," said Ms. Nguyen Phuong Nga, Deputy CEO of CNCTech Group, at an investment seminar. "At the same time, we provide a comprehensive suite of support services—including recruitment, accounting, legal, and operations, as well as housing solutions for experts—to help businesses accelerate their factory launch. CNCTech is ready to partner with the new Phu Tho province to build a green industrial ecosystem and establish the region as a leading industrial center."
The global supply chain shift, intensified by new U.S. tariff policies of up to 40% on goods transshipped from China, is accelerating the wave of manufacturing relocation to Vietnam.
"Vietnam is a prime destination for manufacturing and logistics firms, thanks to its strategic location, low costs, and ready infrastructure," noted Ms. Trang Bui, Country Head, Cushman & Wakefield Vietnam. "Gateway provinces like Vinh Phuc, now merged with Phu Tho, are becoming a magnet for FDI."
In the first half of 2025, Vinh Phuc's investment promotion efforts yielded impressive results. The province licensed 18 new FDI projects with a total registered capital of $78 million and approved capital adjustments for 28 existing projects totaling USD 272 million. The total FDI in flow of USD 350 million represents a 103% increase year-on-year. Meanwhile, domestic direct investment (DDI) also saw a surge, with VND 2,600 billion in new registered capital, up 153% over the same period
The region's labor force is another significant asset. As of Q1 2025, over 251,000 people were employed in local enterprises, with nearly 68,000 in electronics, 54,000 in textiles and footwear, and over 10,000 in the automotive sector. The trained labor rate stands at 81%, with an average monthly income of nearly VND 11 million. From 2025, the province is projected to require an additional 20,000–25,000 workers annually to meet the demands of its industrial parks.
While challenges remain—Vinh Phuc's 2024 Provincial Competitiveness Index (PCI) score of 68.29 ranked it 25th nationwide, a drop of 10 places, with areas like land access and administrative proactivity needing improvement—the merger is seen as a solution. It not only streamlines the administrative apparatus but also creates an opportunity to form an integrated industrial region that leverages the unique strengths of each locality. The government is ramping up investment in infrastructure, transport, and logistics to attract large-scale investors.
Concurrently, the region is positioning itself as a premier eco-tourism hub in the North, featuring renowned destinations like Tam Dao, Dai Lai Lake, Tay Thien… over 40 large-scale resort and leisure projects are underway, which not only enhance the region's image but also provide a robust support ecosystem for its industrial parks, particularly in attracting and retaining high-quality talent.
This combination of industry, logistics, and tourism creates a multi-pillar development model, transforming the area from merely a place for factories into a destination to live, work, and invest for the long term. With Vinh Phuc's solid industrial base, Phu Tho's cultural and tourism potential, and Hoa Binh's rich natural resources, the new province is set to become a formidable new growth pole for Northern Vietnam.
*The province of Vinh Phuc mentioned in this article refers to its former administrative boundaries before the merger and re-districting of provinces and cities on July 1, 2025.
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