Archive | November, 2008

Khang Thong allowed to build IP, duty-free area

30 Nov
The HCMC-based Khang Thong Joint Stock Company has just obtained an investment certificate to develop a new industrial park and a duty-free area in Nhon Hoi Economic Zone in the central province of Binh Dinh.


Khang Thong will spend more than VND4 trillion, or some US$235 million, developing the duty-free area covering 490 hectares, an industrial zone covering 70 hectares and a bonded depot covering 40 hectares inside the economic zone near Quy Nhon City.

The company is expected to start work on the projects next year and complete work in 2012, ready to bring them online one year later, said an official from the central province.

Nguyen Thanh Hai, director of the province’s investment promotion center, told the Daily on Thursday on the phone that he expected Khang Thong as a big company in HCMC to develop the projects quickly.

Khang Thong specializing in real estate and infrastructure projects has several properties underway in HCMC, Long An and Ba Ria-Vung Tau provinces.

The company early this year inaugurated an office building at 67 Nguyen Thi Minh Khai Street in HCMC’s District 1 to meet the increasing demand of local and foreign companies.

Khang Thong currently operates Thanh Duc Industrial Park (IP) in the Mekong Delta province of Long An, and also is developing three other IPs including the 56-hectare Kim Dinh IP, the 68-hectare Tam Phuoc 3 IP, and the 50-hectare Tam Phuoc 4 IP in Ba Ria-Vung Tau Province.

Besides, the company is developing some residential projects including an 11-hectare project in Ben Luc District, Long An Province, a villa area on 72 hectares nearby, and a 11-hectare project in HCMC.

Khang Thong IP will be the fourth IP inside Nhon Hoi Economic Zone. The other three IPs are being developed by three other companies, comprising Saigon-Nhon Hoi Joint Stock Company under Saigon Invest Group, Hong Kong’s Hong Yeung International Limited, and another local company named HBC.

Nhon Hoi Economic Zone in the central province of Binh Dinh, around 700 kilometers north of HCMC, is emerging as an attractive destination for investors in tourism, infrastructure and manufacturing projects. It is adjacent to the existing Quy Nhon Port, one of the top ten ports in Vietnam, which is able to accommodate 30,000DWT ships.

A lot of major Vietnamese and foreign companies have shown keen interest in Nhon Hoi, with projects in the pipeline to include industrial parks and ports, a wind power station, residential complexes, auto factories, shipyards and tourism facilities.

At least 19 local and foreign companies have been licensed to invest into the zone with total pledged capital of more than VND15.7 trillion, or nearly US$1 billion.

Investors in Nhon Hoi will benefit from incentives similar to those that apply in the Chu Lai Open Economic Zone and the Dung Quat Economic Zone in Quang Nam and Quang Ngai provinces nearby.

By Quoc Hung/
The Saigon Times Daily

The four problems of the real estate market

30 Nov
The quietness of the real estate market is a reason for the slowdown in economic development. There are four problems in the real estate market, according to Tong Van Nga, Secretary General of the Vietnam Real Estate Association.


Do you think that the fall of the real estate market is the reason behind the economic development slowdown?

Yes, I do. If real estate investment and business develops well and steadily, this will lead to the development of the construction industry, construction material production (steel, cement, materials for interior decoration) and other industries, including woodworking, electricity, and electronics production. And of course, when the real estate market is quiet, relevant industries suffer.

What are the biggest problems of the real estate market now?

There are four problems. First, the number of real estate transactions carried out on licensed trading floors remains modest, while underground transactions remain popular.

Second, the structure of commodities in the real estate market proves to be unreasonable. The market lacks the apartments that fit the pockets of employees. Meanwhile, investors have injected too much money in building high-grade and luxury villas to serve high-income earners and speculators. Therefore, the real estate market suffered heavily when the bank interest rate increased considerably.

Third, there exist problems in the regulations on compensation for local residents for site clearance. The procedures for granting investment licenses and the procedures for granting red books and pink books, the certificates on house and land use right prove to be very complicated.

Fourth, banks are not really the ‘fellow-traveler’ of real estate developers and real estate buyers. There has not been any long-term fund for the real estate sector in particular, and industries in general.

Currently, real estate developers have been relying on short-term loans from banks, which banks mobilize from the public. That is why the real estate market suffers immediately when the interest rates fluctuate.

Some experts have said that the difficulties of domestic real estate developers are caused by a lack of capital, and this provides opportunity for foreign investors. What is your comment about that?

It is true that while Vietnamese enterprises are facing difficulties due to the lack of capital, foreign investors have jumped into Vietnam, especially the central areas in Hanoi and HCM City.

Foreign investment funds have been taking full advantages of this, offering cooperation with domestic investors or asking to buy back projects at low prices.

Commercial banks have resumed real estate credit, while having slashed lending interest rates. How will this affect the real estate market?

This is really a good sign, but it is not enough to recover the real estate market.

Source: TBKTVN/
Image by: Blue_milkyway88

Construction update – November 2008

30 Nov



Xi Riverview Palace Updated

28 Nov

BirdView


Xi-Day

Xi-Night

Xi-Location


Swimming-Pool


Playground


Lobby


Fitness-Club


Main Gate

Xi Topdown View

Floor plan

The four problems of the real estate market

28 Nov
The quietness of the real estate market is a reason for the slowdown in economic development. There are four problems in the real estate market, according to Tong Van Nga, Secretary General of the Vietnam Real Estate Association.


Do you think that the fall of the real estate market is the reason behind the economic development slowdown?

Yes, I do. If real estate investment and business develops well and steadily, this will lead to the development of the construction industry, construction material production (steel, cement, materials for interior decoration) and other industries, including woodworking, electricity, and electronics production. And of course, when the real estate market is quiet, relevant industries suffer.

What are the biggest problems of the real estate market now?

There are four problems. First, the number of real estate transactions carried out on licensed trading floors remains modest, while underground transactions remain popular.

Second, the structure of commodities in the real estate market proves to be unreasonable. The market lacks the apartments that fit the pockets of employees. Meanwhile, investors have injected too much money in building high-grade and luxury villas to serve high-income earners and speculators. Therefore, the real estate market suffered heavily when the bank interest rate increased considerably.

Third, there exist problems in the regulations on compensation for local residents for site clearance. The procedures for granting investment licenses and the procedures for granting red books and pink books, the certificates on house and land use right prove to be very complicated.

Fourth, banks are not really the ‘fellow-traveler’ of real estate developers and real estate buyers. There has not been any long-term fund for the real estate sector in particular, and industries in general.

Currently, real estate developers have been relying on short-term loans from banks, which banks mobilize from the public. That is why the real estate market suffers immediately when the interest rates fluctuate.

Some experts have said that the difficulties of domestic real estate developers are caused by a lack of capital, and this provides opportunity for foreign investors. What is your comment about that?

It is true that while Vietnamese enterprises are facing difficulties due to the lack of capital, foreign investors have jumped into Vietnam, especially the central areas in Hanoi and HCM City.

Foreign investment funds have been taking full advantages of this, offering cooperation with domestic investors or asking to buy back projects at low prices.

Commercial banks have resumed real estate credit, while having slashed lending interest rates. How will this affect the real estate market?

This is really a good sign, but it is not enough to recover the real estate market.

Source: TBKTVN

XI RiverView Palace – Hi-end Appartments in HCMC

26 Nov
Xi [zai] is globally known as eXtra Intelligent, the delux appartment for the sophisticated person. In Vietnam, GS Engineering & Construction Corp. (GS E&C) started to build the image of Xi by its first housing project Riverview Palace in district 2, HCMC.


GS E&C have an ambitious plan to introduce Xi series in Vietnam and this Xi Riverview Palace is the first part of the upcoming series. It is a very special project since they are planning to open a new housing trend in Vietnam, a stylish living culture.



Why Xi Riverview Palace? Because it is the first trust, the first trend and the first class in Vietnam.

Download the Presentation of Xi Riverview Palace here

For further information please contact

GS E&C Sale Office

4th . Fl, Thu Thiem Building, 40/1 Tran Nao St

Binh An Ward, Dist 2, HCMC

Tel: (08)3. 740 6990

Hanoi Branch

#1105 44B Ly Thuong Kiet, Hoan Kiem Dist. Hanoi

Tel: (04)3. 9345100

Photo from: Titanic98

Help for the realty market

24 Nov
Vietnamese real estate experts have underlined the need to find ways to thaw the lackluster property market; otherwise, any failures in this sector will have a great impact on the economy.


Importance of the realty market

Dinh The Hien from Vietnam Export and Import Bank (Eximbank), speaking at a recent seminar at the HCMC University of Economics, called for concerted efforts by the Government to cope with problems in the sector.

“Realty-related business activities account for 30% of the economy,” Hien said.

The realty market is closely related to other markets such as stock, commodity and labor, so 1% growth in realty can create 1.5%-2% growth in related markets, Hien said.

Real estate is always the most important asset for securing bank loans and thereby accounts for over 80% of all bank loan approvals. Without Government solutions, banks are forced to foreclose real estate loans to recover losses, thus devaluing properties on the market and raising bad debts.

“The vicious circle may cause the banking system to decline,” Hien said. In addition, banks cannot auction property at will. “Banks face a big problem as it takes around three years to finish procedures settling a bad debt,” said Pham Khac Khoan, vice director of Kien Long Commercial Joint Stock Bank.

Solutions for bad debts

Khoan suggested the State Bank of Vietnam total up all bad debts or property-secured loans and re-evaluate them according to market prices to find a solution. “We should give priority to properties with high demand and liquidity, not all bad debts at the same time,” Khoan added.

Many at the seminar agreed that a common fund of VND50-100 trillion should be established to help banks overcome the financial crisis. The money could mobilize the central bank’s currency, price stabilization funds, insurance deposits, or surplus capital from the equitization of State-run enterprises and be managed by the government to solve bad debts by buying back assets or providing short-term refinance credit to ensure liquidity.

The State Bank of Vietnam has announced the total outstanding loans for realty projects in the country are around VND115 trillion, with 74% of them provided for projects in Hanoi and HCMC. Lao Dong newspaper quoted commercial banks as saying the ratios of bad debt are low.

Stimulating the realty market

Eximbank’s Dinh The Hien said realty companies cannot get bank loans without buyers, so demand should be stimulated first.

On the other hand, banks will need to cooperate with realty companies, said Nguyen Huy Cuong from Saigon Thuong Tin Bank’s Securities Company. “Real estate corporations should focus on the housing market segment with prices ranging from VND500 million to VND1 billion per unit. There is high demand in this segment,” Cuong said.

But banks are reducing loans for property projects while people need to buy houses. As a result, there is little chance for these people to access bank credit.

Tran Hoang Ngan, vice rector of the HCMC University of Economics, also said that few banks have liquidated the bonds which they were forced by the state bank to buy in March as the coupon of the bond is fairly high, at 13% per year.

Many enterprises have plans to issue bonds with an interest rate of 14%-15% per year for two or three year terms, Le Anh Tuan of Dragon Capital said. It would be wiser for a bank to lend to big corporations with interest rates ranging from 15% to 16% annually within three to eight years than to a borrower with a monthly income of VND10 million at the rate of 18%.

The Sate Bank’s recent interest rate cut fails to move capital to production activity or other useful places. “If the bond dividend is not reduced to 9%-10%, property enterprises and house buyers will face more difficulties in the future,” Tuan said.

The Saigon Times Daily/
Image from: Fredi Meier