Property developers from Japan, Malaysia and Singapore still eye Vietnam's real estate market with interest, despite global difficulties and the whirlwind of disinvestment in many FDI projects, as they still believe a recovery is imminent.
Artificial model of Sora Garden 1 luxury apartment building
With the property market decidedly cold, Becamex Tokyu Co Ltd earlier this month broke ground at the site of the Sora Gardens 1 apartments, the first project of the joint venture's Tokyu Binh Duong Garden City.
Sora Garden 1 is a 24-storey building, one of three luxury apartment blocks to be built in the development which lies 30km to the north of HCM City. The 1,500 apartments will range in size from 70sq.m to 100sq.m, while the luxury houses and apartments are aimed at middle to high-income customers.
Becamex Tokyu began work on the US$1.2 billion project in March this year, marking the first time a Japanese firm has been involved in a Vietnamese urban development.
According to Toshiyuki Hoshino, general director of Becamex Tokyu, this is his group's first venture into the local real estate market. Through the project, the group will transfer its technology and experiences of urban development to the local market, he added.
"The domestic property market is currently in strife but remains a young market with high development potential," Hoshino told Vnexpress online newspaper, adding that his firm was deploying its long-term business strategy in Vietnam .
"Many investors have fled the market but my company is committed to long-term urban development and believes the rapid population and urbanisation growth will lead to a roaring property market recovery," he said.
By the end of July, Singapore had more than 550 projects with a total accumulated capital of US$6.8 billion invested in HCM City . In real estate development alone, Keppel Land of Singapore boasts 18 licensed projects in Vietnam with a total capital of US$2 billion.
The group has partnered with Tien Phuoc and Phu Hung companies, as well as the HCM City People's Committee to develop housing projects.
Like their Japanese and Singaporean counterparts, Malaysian investors are still interested in the Vietnamese market. In October, Saigon Thuong Tin Tan Thang Investment Real Estate Joint Stock Company (TTJSC) started marketing its large Celadon City project in HCM City 's Tan Phu district, over a year after the project got off the ground.
Chow Chee Fan, general director of TTJSC, said the local property market is still in difficulty but the company keeps investing to develop the project over the long term.
He said: "We are here for a long term investment, so whether the market is up or down we will continue the project development."