Tap opportunities in Vietnam, developers told

Monday, May 3, 2010


Tap opportunities in Vietnam, developers told


Real estate adviser CB Richard Ellis (Vietnam) Co Ltd says Malaysian developers should take the opportunity to make inroads into Vietnam as the economy is improving.

Its managing director Marc Townsend said there was more affordability in the market, coupled with transparency and clearer rules regarding when a developer can sell a property and collect deposits.

But he cautioned developers that the market was still volatile and subjected to speculative swings.

Townsend said developers looking to explore Vietnam should study Ho Chi Minh City and Hanoi as there was a lot of land for development.
"Foreigners are restricted to land development in Vietnam. They should form joint ventures with the locals to enter the market," Townsend said.

He added that the focus for foreign developers in Vietnam currently was to build condominiums with "selling off" as their exit strategy.

Berjaya Land Bhd and Perdana ParkCity Sdn Bhd are looking to develop new projects in Vietnam.

Perdana ParkCity, the subsidiary of the timber-based Samling group, will launch its maiden township project in Hanoi, worth some RM6 billion by June or July this year as it is bullish on the market.

Berjaya Land, which had bought Sheraton Hanoi Hotel and Towers and InterCon Hanoi Hotel previously, will start to develop its US$6.3 billion mixed project in Dong Nai Province in two years.

Other companies that have forayed into Vietnam include SP Setia Bhd, Ireka Corp Bhd, Gamuda Bhd, Sime Darby Group and Sunrise Bhd.

"Among the developers, SP Setia has had some success in Vietnam," Townsend said.

Sunrise and Sime Darby had respectively ventured into hospitality projects in Hanoi and Vung Tau.

"Other developers have sniffed around since 2006 but did not commit as the process to identify sites, structure a joint venture, find funding and clear land for development takes a long time," Townsend said.

Department store operator Parkson Holdings Bhd owns three stores in Ho Chi Minh City, and one each in Hanoi and Hai Phong. It has talked about setting up more stores in Vietnam in the future.

By Business Times