VietNamNet Bridge – Real estate ranked fourth among the most attractive business fields for foreign investors, with registered FDI capital of $1.15 billion in the first half of the year.
According to Savills Vietnam, the increase in FDI in the manufacturing sector has prompted investors to pour money into projects to develop industrial infrastructure.
Thai company Hemaraj Land & Development and Vietnamese firm Cienco 4 last May confirmed cooperation to set up a joint venture to develop an IZ on an area of 3,200 hectares in Nghe An province, capitalized at $1 billion.
Many deals were made in the first half of the year. Japanese firm Nishi Nippon and Hankyu joined forces with Vietnamese firm Nam Long to develop Mizuki Park residential quarter on an area of 26 hectares in Binh Chanh district, HCMC, capitalized at $351 million.
Meanwhile, Aeon Mall has teamed up with BIM Group to develop Aeon’s second shopping mall in Hanoi, covering an area of 16.7 hectares in a $200 million project. Son Kim Lan has successfully called for $100 million worth of investment capital from a Japanese investor.
|The increase in FDI in the manufacturing sector has prompted investors to pour money into projects to develop industrial infrastructure.
Housing projects continue attracting attention from investors. Chinese firm Fortune Land Development has bought Lotus Dai Phuoc shares from VinaCapital, worth $65.3 million. This is a residential quarter project covering an area of 198.5 hectares in an area of Dong Nai province adjacent to HCMC.
A 65 percent stake in Times Square complex worth $41 million has been transferred by VinaCapital to Elite Capital Resources Limited.
Analysts have predicted that FDI flow into the real estate sector will continue in the time to come thanks to open policies and the great potential in tourism development. However, they warned that the amount of capital into the market needs to be measured by disbursed capital, not registered capital.
Many registered projects have not been implemented. Booyuong Mo Lao project in Ha Dong district, for example, has been left unimplemented for years.
Nguyen Tri Hieu, a respected banking expert, commented on Dau Tu Bat Dong San that more FDI capital is good news, but that is necessary to reconsider the situation if too much capital flows into the real estate sector. If the capital only goes to high-end real estate and resort projects, it will only heat up the market and lead to oversupply in the market segment, and not propel socio-economic development.
Phan Huu Thang, former head of the Foreign Investment Agency, now chair of the Vietnam Real Estate Association, affirmed that FDI real estate projects would still be welcomed. The problem is that Vietnam needs to supervise project implementation to ensure sustainability in investment and development.
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