Singapore-listed logistics developer GLP and Vietnamese transport company SEA Logistic Partners plan to invest $1.5bn in Vietnam to meet surging demand for storage and transport services there.
The investment will be made over the next three years, an executive at the SEA told the Reuters news agency.
The venture will build its warehouses on land it has acquired in the Hanoi and Ho Chi Minh City city regions.
It aims to build three logistics hubs by the first quarter of 2022, two in the north and one in the province of Long An in the south.
Of the land acquisitions, Kent Yang, a co-founder of SEA and a former president of GLP, said: "We had targeted about 25ha to 30ha in the first 12 months and right now, in the first six months, we’ve almost already achieved that."
Vietnam is expected to benefit from international companies’ moving their production centres from China, in response to the US trade war, as well as rapidly growing demand for e-commerce.
Ming Mei, chief executive of GLP, said in a press statement: "Within Southeast Asia, Vietnam is one of the most attractive markets given its population dynamics, growing economy and middle class which support domestic consumption.
"When GLP enters a new market, growth and scalability are two key factors we consider. We see similarities between Vietnam and our logistics businesses in China, India and Japan and know we can leverage our expertise and knowledge from our experiences in those markets to create a strong and sustainable business in Vietnam."
GLP is Asia’s largest warehouse builder and operator, with $89bn of assets under management. It operates some 64 million sq m of logistics assets, mostly in China and Japan, but as yet has no presence in Southeast Asia.
Image: Hanoi, one of the fastest growing cities in the world, attracts about 20% of all investment in Vietnam (Dreamstime)
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