After ten years in the making, the crowning jewel of Saigon’s vista, Saigon One Tower will be put on a public auction to resolve at least VND6.11 trillion ($268.22 million) non-performing loans by Vietnam Asset Management Company (VAMC), putting an end to one of the most anticipated construction projects in Vietnam.
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To date, myriad market analysts forecasted that a notable number of investors would bid lower than $268.22 million in order to protest the unrealistic listing rate, considering ten years of inactivity due to inefficient investment and postponed development.
Within four days, the estimated starting price of the project’s total assets shrank from VND7 trillion ($307.3 million) to $268.22 million, which is still frowned upon by investors.
Le Hoang Chau, chairman of the Ho Chi Minh City Real Estate Association (Horea), asserted that the listing price was considered “reasonable,” yet there are high odds that the public auction will not attract the right investor despite the enormous interest expressed.
Specifically, the total assets which would be included in the public auction comprise of the ownership of a total 14,954 square metres of the commercial area and the intangible assets which is the asset management of the entire construction of the garage, shopping mall, offices for lease, and supporting construction.
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Previously, in 2017, Saigon One Tower was forfeited by VAMC with the purpose of resolving non-performing loans in accordance with Resolution 42 on the handling of non-performing loans after the owners fail to repay debts.
On August 21 last year VAMC officially sized the asset of Sai Gon One Tower Company in order to collect non-performing loans worth more than $300 million.
The construction of Saigon One Tower, commonly dubbed as Saigon’s “Ghost Tower,” was started in 2007 as a residential and office development project, with the involvement of Alpha King Real Estate Development JSC and M&C Real Estate as the main developers.
Additionally, the project’s total capital mounted up to VND5 trillion ($219.5 million) with the initial target of becoming the third highest tower in Vietnam. However, after 80 per cent of the construction was finished in 2011, the entire development stopped until VAMC seized the asset in 2017.