Demand maintains a positive sentiment with stable leasing performance

• Market demand maintained positive momentum, driven primarily by domestic consumption and electronics export demand, which attracted interest from both domestic and international tenants.
• Positive leasing sentiment facilitated a strong net absorption of 145,000 sqm for Q2 2026, reducing the vacancy rate to 32.7%, a significant drop of 5.0 ppts from previous quarter.

Former Hai Duong and Bac Ninh welcome new supply

• The Northern market maintained strong momentum with nearly 50,000 sqm of new supply by KCN and Frasers Property in the second quarter of 2026. This addition reinforced KCN’s position as a rising market player with a 6% market share.
• Despite new launch from peers, BWID and Mapletree hold their leading positions in the Northern Prime RBW market. Notably, Mapletree is poised to deliver substantial supply in late 2026.

Average rent experiences a modest rise while market yield remains unchanged

• Average rent saw a modest rise of 0.3% q-o-q to USD 5.1 per sqm per month. This growth reflected the stable pricing strategies of developers while increasing supply intensified market competition.
• Capital values continued their upward trajectory following asset improvements. Market yields remained consistent at 8.2% over the past two years, indicating a conservative approach in the current investment environment.

Outlook: Global supply chain uncertainties may drive demand fluctuations and maintain cautious investor sentiment

• In the near term, the Northern RBW market is positioned for continued expansion. Approximately 640,000 sqm of new stock will enter the market, primarily in former Hung Yen and Bac Ninh provinces and from major developers such as Frasers Property, Mapletree, and SLP.
• Economic uncertainties stemming from Middle East tensions may lead to fluctuations in demand and cautious sentiment of investors. Amid this backdrop, domestic consumption and electronics exports will continue to serve as main growth engines.