More capital flows into HCM City real estate sector

HCM City's downtown area. More foreign capital has flown into the city's real estate sector. (Source: www.cnbc.com)

Ho Chi Minh City (VNA) – More capital continues flowing into HCM City’s real estate sector as local companies and foreign partners join hands to take advantage of the new housing law, which allow foreigners to buy houses in Vietnam.

Leading acquisition activities in the first quarter of 2016 is Dat Xanh Group, who spent 61 billion VND to bring its share at the Nong nghiep Print Joint Stock Company (JSC) to 111 billion VND to implement the Opal Tower project in Thu Duc District.

The Dat Xanh Group also received a transfer of over 100 billion VND from the Kim Khi Tower project of the HCM City Kim Khi (Metal) JSC in District 7.

Meanwhile, the Dream House JSC spent hundreds of billions of dong to buy the project located at 1177 Huynh Tan Phat in District 7.

Besides buying projects, local companies also partner with foreign partners. Nam Long Group and Japanese investors Hankyu Realty and Nishi Nippon Railroad signed a cooperation agreement to develop the Fuji Residence project in District 9 with a total investment of 1,300 billion VND (57 million USD).

The Phat Dat Realty Development JSC, An Gia Investment and Japan’s Creed Group Investment Fund partnered to develop the River City project, worth 500 million USD, in District 7.

Minh Nguyen Long and L&L – LuckyLand companies will team up with Singapore’s SynGience Finance Corps to implement the DepotMetro Tower project in District 12. SynGience will contribute 400 billion VND (17.6 million USD).

Other remarkable acquisitions in the city’s real estate sector in the first quarter include Keppel Land’s 93.9 million USD purchase of part of the Empire City project in District 2; Truong Loc Phat and Phat Dat’s purchase of the project at 132 Ben Van Don in District 4; the selling of Thao Dien Plot to Capitaland Vietnam and Duxton Hotel Saigon being sold to New Life RE.

According to the Ho Chi Minh City Real Estate Association ( HoREA ) in 2015, the city has approved the transfer of 23 projects, 2.55 times higher than 2014.

A major portion of domestic and foreign investment has also been poured into the real estate sector in the first four months of this year.

According to the HCM City People’s Committee, new domestic businesses licensed to operate in real estate sector have a total registered capital of 32.4 trillion VND, accounting for around one quarter of the total registered capital of all newly-licensed domestic businesses in the January-April period.

In terms of foreign investment, 102.2 million USD was poured into the city’s real estate sector, accounting for 44.7 percent of the total foreign capital flow into HCM City in the period.

Statistics of the HoREA showed that in 2015, credit in the property sector in the city reached 140 trillion VND, making up 12.3 percent of total credit in the whole city. Moreover, around 21.6 percent of the 6.65 billion USD in foreign remittances in 2015 and the first quarter of 2016, flowed into the real estate sector.-VNA