The smart complex, covering 7.54 hectares, is set to cost VND20.1 trillion (US$885.5 million), excluding compensation and site clearance expenses.
Vietnam expects to attract foreign investors in all sectors of the property market
Also in Thu Thiem, Empire City project is under implementation with an investment capital of $1.2 billion. The project is developed by a 50/50 joint venture between two Vietnamese companies – Tien Phuoc Real Estate JSC and Tran Thai Real Estate Co Ltd, and one foreign partner – Denver Power Ltd.
South Korea’s Daewon Thu Duc House last month also decided to take part in a wave of foreign-backed developers investing in Vietnam’s property market. It established a joint venture with the Vietnam Manufacturing and Export Processing Company to develop a $115 million office complex and trading center, along with high-rise apartment buildings, townhouses, a supermarket, and other facilities, in Hanoi. The joint venture has charter capital of $23 million, of which Daewon Thu Duc House contributes 49 percent.
VRG Riverview, a project invested by the Vietnam Rubber Group and was frozen for a long time, is also expected to have a new face as it has been taken over by CapitaLand. The Vietnam’s first international A-class complex will receive more disbursement from a $500-million investment fund committed by Singaporean developers and the new owner has been accelerating the project’s construction.
Another Singaporean developer, Keppel Land, has paid VND846 billion ($37 million) to raise its share to 16 percent in the Saigon Center project in the city center.
Robust FDI in real estate
In the first five months of this year, foreign investors registered to pour $623.3 million into Vietnam’s real estate market. Including the registered capital of licensed projects from previous years, FDI in the country’s real estate industry reached $806.5 million, according to the General Statistics Office.
Most of these investors choose the high-end real estate segment when entering the Vietnamese market because in this segment, they have the biggest advantage. According to many experts, foreign enterprises often come from more developed real estate markets, so they have more experience in the design, development and operation of high-end real estate.
Su Ngoc Khuong, investment director at property services firm Savills Vietnam, said the presence of foreign investors is a trend in the real estate market today.
The real estate market in Vietnam is very attractive to foreign investors, not only in terms of profitability but also in terms of economic growth, government policies for foreigners in terms of owning houses in Vietnam and incentives for foreign investors, Khuong said.
According to the Savills representative, these investors will bring to market their experiences in project development. On the other hand, they also help to increase competitiveness, improve business activities and product performance in the market, bringing more benefits to consumers.
Forecasting about the investment capital inflow next time, Stephen Wyatt, country manager of JLL Vietnam, commented that Vietnam continues to attract significant interest from foreign investors in all sectors of the property market, and that the biggest challenge for the firm is finding quality opportunities.
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