HCMC among top data center destinations in land costs
Vietnam’s Ho Chi Minh City is in the top 10 group for selection in the Land Price category in global property services firm Cushman & Wakefield’s latest annual report on data center developments.
The report ranks major data center markets around the world based on 13 categories, including market size, fiber connectivity, power cost, and environmental risks to determine the top overall markets as well as the top-performing markets in each category.
According to the firm’s Q4/2022 HCMC market beat report, the average rental price in the southern Vietnamese economic hub was $159 per sqm for the entire lease cycle, up 3% quarter-on-quarter and 10% year-on-year.
Vietnam may be a frontier data center market at this juncture but has numerous fundamentals that would suggest great potential for development going forward, Cushman & Wakefield Vietnam said on Thursday.
Vietnam currently has about 70% internet penetration, with an estimated 29 million people yet to get online. Over 48% of Vietnam’s capacity is located in HCMC.
South of HCMC is a preferred destination for data centers, especially for cloud service platform providers, due to latency issues and manpower, the annual report says. Increasing land prices, limited land availability, especially for hyperscale, and limited current or future power supply in HCMC, are pushing new data center developments to nearby Binh Duong or Dong Nai provinces.
In the southern economic hub, Vietnam’s CMC Telecom opened its Tan Thuan Data Center last August. The facility was designed by B-Barcelona of Singapore. The facility covers more than 1.3 hectares and was 30% preleased at the launch time, according to CMC.
Australian Edge Centres has expanded to Asia with the launch of its first data center, EC51, in HCMC in collaboration with Vietnam National University HCMC. They also have plans for an additional edge site in the city’s District 1.
Hong Kong-headquartered GAW Capital in June 2022 acquired a greenfield plot in HCMC’s Saigon Hi-Tech Park (SHTP) to develop it into a data center covering almost two hectares with an IT capacity of 20 megawatts.
NTT Global Data Centers India, better known as NTT, is partnering with Vietnamese firm Quang Dung Technology (QD.Tek) to develop a new data center in SHTP that will support 6 MW of IT capacity, with an estimated launch date in 2024.
NTT operates a data center in Hanoi that opened in 2009 in partnership with the state-run Vietnam Posts & Telecommunications Group (VNPT). Meanwhile, QD.Tek, established in 2004, is part of food manufacturer GreenFeed Group.
Vietnamese telecom giant Viettel has also announced plans to build a new data center in HCMC with a total of $261 million in investment, described as the nation’s largest. The outlying districts of Cu Chi and Hoc Mon have been selected to house the project, but the state-run group has not finalized the location. Meanwhile, its IT infrastructure developer Viettel IDC secured a loan of VND400 billion ($17 million) for green financing from HSBC Vietnam last August to build a data center in Hanoi.
VNG, another Vietnamese heavyweight, launched its tier-III VNG Data Center in Tan Thuan Export Processing Zone, District 7, HCMC in mid-December. The zone is also home to CMC Telecom’s data center launched in August.
Vietnam offers huge opportunities for data center developers amid rising demand, especially from foreign customers, Nguyen Thanh Danh, chief operation officer of VNG Cloud under VNG, told The Investor.
“There will be huge opportunities for infrastructure as a service, or IaaS, platform as a service (PaaS), and software as a service (SaaS) businesses, with data centers and cloud computing playing a great role in IaaS,” he said.
Vivek Dahiya, head of Cushman & Wakefield’s data center advisory team, Asia Pacific, said interest and investment in the region would continue at pace as the sector evolved.
“We are seeing significant investment and interest in Bangkok, Ho Chi Minh City, Hyderabad, Johor and Manila and we expect this to continue, along with interest in other primary and secondary markets in the region,” Dahiya said.
VNG Cloud’s COO Danh told The Investor that despite being facilitated by the Vietnamese government for a long time, digital transformation in both the public and private sectors has not taken place as quickly as expected compared to other countries in the region.
“However, the process has accelerated recently as organizations and enterprises have become more aware of the benefits of digital transformation. From 2023, the market is predicted to make strong breakthroughs despite economic difficulties,” he said.
- Read More
World Bank’s IFC plans $200 mln loan to LG Innotek Vietnam
The International Finance Corporation (IFC), the private sector arm of the World Bank Group, plans to make a sustainability-linked loan (SLL) of up to $200 million to LG Innotek Vietnam Haiphong Co., Ltd.
Industries - Tue, October 29, 2024 | 10:11 am GMT+7
Vietnam banks' earnings outlook ‘relatively positive’: PYN Elite Fund
The Q3/202 earnings growth of Vietnam’s listed companies will likely settle around 20-30% and banks’ earnings outlook for the next 12 months is also relatively positive, said the Finland-based PYN Elite Fund.
Finance - Tue, October 29, 2024 | 9:39 am GMT+7
Chinese e-commerce giant Temu's Vietnam entry: unfair competition or market economy norm?
Vietnam's social media is currently inundated with ads from Temu, the e-commerce platform under China’s PDD Holding, showcasing a diverse array of products – from electronic chips to refrigerator mats – at discounts of up to 90%, and raising concerns about its strategy and compliance.
Opinion - Tue, October 29, 2024 | 7:55 am GMT+7
China’s BYD to repair Apple tablets with $375 mln northern Vietnam project
Chinese giant BYD is set to repair Apple tablets at its factory in Vietnam’s northern province of Phu Tho.
Industries - Mon, October 28, 2024 | 10:27 pm GMT+7
Singapore spends $270 mln on AI infrastructure, human resources
Singapore’s National Research Foundation (NRF) will allocate $270 million to the National Supercomputing Centre (NSCC) in the next three years to train specialists and develop next-gen supercomputers in order to boost AI through supercomputing talent and infrastructure.
Southeast Asia - Mon, October 28, 2024 | 10:21 pm GMT+7
Malaysia to leverage 2025 ASEAN chairmanship to advance regional carbon initiatives
Malaysia’s ASEAN 2025 chairmanship provides the best opportunity to promote carbon trading and carbon credits among its member countries, says Sarawak’s Deputy Minister of Energy and Environmental Sustainability Datuk Dr Hazland Abang Hipni.
Southeast Asia - Mon, October 28, 2024 | 10:20 pm GMT+7
Vietnam, UAE elevate relations to comprehensive partnership
The United Arab Emirates (UAE) has become Vietnam's first comprehensive partner in the Middle East, underscoring the two nations' commitment and high expectations for a strengthened, practical and effective collaboration.
Politics - Mon, October 28, 2024 | 10:16 pm GMT+7
UAE plans to hold conference to promote investment into Vietnam: minister
The United Arab Emirates (UAE) has plans to organize a large-scale conference in Vietnam to canalize investment from the UAE and elsewhere into the Southeast Asian country, says a minister.
Investing - Mon, October 28, 2024 | 5:41 pm GMT+7
Sustainable packaging key focus area in Suntory PepsiCo Vietnam growth strategy: exec
Suntory PepsiCo Vietnam is actively promoting various initiatives in sustainable packaging as a key focus area in its development strategy, says Do Thai Vuong, deputy general director in charge of external affairs and communications.
Companies - Mon, October 28, 2024 | 5:02 pm GMT+7
Nuclear power Vietnam’s choice to ensure sufficient energy: country top leader
Nuclear power is the path for Vietnam to ensure sufficient electricity supply by 2045, Party General Secretary To Lam said Saturday at the ongoing National Assembly session.
Energy - Mon, October 28, 2024 | 4:33 pm GMT+7
Vietnam Electricity’s northern unit seeks German support in finance, technology
Northern Power Corporation (EVNNPC), a unit of state utility Vietnam Electricity, is seeking further support from the German government and state-owned German development bank KfW to reach sustainable growth.
Energy - Mon, October 28, 2024 | 4:16 pm GMT+7
Leading UAE firms plan to expand investment cooperation in Vietnam
Four leading UAE corporations collaborating with Vietnamese firms have plans to expand investment cooperation in the country, executives told Prime Minister Pham Minh Chinh in Abu Dhabi Sunday.
Industries - Mon, October 28, 2024 | 3:53 pm GMT+7
Real estate developer Nam Long achieves only 3% of year's profit target
Nam Long Group, a major real estate developer in southern Vietnam, recorded an after-tax profit of VND15.5 billion ($610,345) in the first nine months of 2024, reaching only 3% of its annual target.
Companies - Mon, October 28, 2024 | 3:00 pm GMT+7
Vietnam's largest private firm Vingroup launches VinVentures capital fund
Vingroup has launched a capital fund named VinVentures which is dedicated to investing in high-impact technology startups, with assets under management worth $150 million.
Finance - Mon, October 28, 2024 | 2:07 pm GMT+7
Vietnam’s Eximbank sees Q3 earnings triple on forex trading
Ho Chi Minh City-based Eximbank says it earned a net profit of VND721.2 billion ($28.6 million) in Q3/2024, up 198.25% year-on-year, thanks to income from lending and forex trading.
Banking - Mon, October 28, 2024 | 12:25 pm GMT+7
Taiwan electronics firm Lite-On to start $690 mln Vietnam project soon
Taiwan-based Lite-On Technology Corporation, a world-leading provider in optoelectronics and power management, is set to start its $690 million investment in Vietnam next month.
Industries - Mon, October 28, 2024 | 11:01 am GMT+7