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Foreign investment into Vietnam’s real estate sector has fallen sharply this year |
Source: Thanh Nien News
Regarding the office-for-lease segment, Marc Townsend spoke, the thing what renters are paying attention is competitive prices and it is right time for companies to move headquarters and offices from outskirts such as Dist 7, Tan Binh Dist to centre districts in HCM City.
In order to maintain and attract, property investors need to improve current buildings and increase utilities of buildings such as basements, decoration, energy saving, and seek opportunities to re-negotiate rentals.
CRBE Vietnam forecasted the Vietnam real estate market will remain gloomy 2012 in all segments. Only the segment of properties for education, international kindergartens, healthcare, and beauty, eating and drinking will continue generating good performance.
Sharing the point of view, Michael Kokalari—Chief of Kimeng Securities Co’s information research department, through talks with foreign investors in Vietnam, said that the investors from US, Japan, Europe paid a great attention to consumer beheaviors of young mid-class group in Asia generally and Vietnam particularly.
In the recent past, these foreign investors bought back stocks of Vietnam’s consumer industry companies namely Masan, Huong Thuy based on the development potential of this field, he noted.
Michael Kokalari assessed, despite the property prices declined 20-30% as announced lately by PetroLand Co, Vietnam real estate market has not gone to its equibrilium point. Many firms who were facing difficulties in liquidity, bank debts are not desperate because it is normal as debts increased in the crisis period.
David Tran, Vice Chair cum Director of the Asian Real Estate Association of America (AREAA) in US stated at the conference that the Vietnam real estate market is losing liquidity, so investors are seeking money sources outside the banking system, and overseas remittance is the way-out for property projects. If Vietnam continues improving legislative environment, removing barriers in law on contracts, taxation policies for foreigners, the realty market will receive a quite high volume of inward remittances from 4.5 million Vietnamese overseas.
Meanwhile, according to Ta Chau—Director of DFDL Mekong tax and law consulting firm, she was so excited to changes in Vietnam’s laws in 2012.
Ministry of Finance proposed to open Real Estate Investment Trust funds (REITs) which are expected to create a strong movement in the market in following years. Through REITs, creating an easy capital divestment regime whereby investors are able to withdraw capital if necessary, she remarked.
Experts also recommended 16 changes in property-related laws and regulations, including Law on Land, Law on Investment, and Law on Enterprises. These changes may create negative moves in Vietnam in next 5 years.
The Vietnam real estate market in 2012 is determined by the government decisions, she confirmed.
Source: StoxPlus
On the theme of “Vietnam Real Estate 2011”, businesses introduced new solutions to housing construction, using environmentally-friendly and energy-saving technology.
On display are building materials, paints, glass, doors, locks, bulbs, water-proof materials and decorations for houses, villas and top-notch resorts.
The exhibition offers a good chance for Vietnamese businesses to expand cooperative relations with their foreign counterparts through joint investment or technology transfer so as to develop the property market in Vietnam, said Deputy PM Hai.
This is also a good chance for foreign businesses to seek investment opportunities in Vietnam – a market with a high economic growth in the region and the world, he noted.
Source: VOV News
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Illustrated photo |
At the beginning of the seminar, Mr Naito, Associate Director, Research & Consultancy, Savills Japan, said: “With impressive growth rate and talented young labor, Vietnam is significantly increasing its economy capability. Also, Vietnam has been chosen as the new investment destination, switching from China by global producers. Therefore, Vietnam is likely to be a leading country in Asia in attracting investment”.
In the seminar, Neil MacGregor, Deputy Managing Director of Savills Vietnam presented over 20 specific real estate investment opportunities as well as providing an overview of the Vietnamese economy and the property market. Neil also highlighted the increasing interest in Vietnam from Japanese investors and the co-operation between the two countries.
Neil commented: “Despite the global financial crisis, Vietnam has been ranked one of the top investment destinations in the region. Vietnam has recently been voted the top investment destination for Singapore investors in the ASEAN region, ahead of Malaysia and India. Earlier this year, Vietnam was ranked the fourth most preferred emerging market for investments by the Association for Foreign Investors in Real Estate (AFIRE). Being an emerging market with favourable demographics, low labour costs and a strategic location in the region, Vietnam still has much to offer”.
He also said: “The year 2011 is seeing a wave of investment from Japan into Vietnam in many sectors including finance, communications, consumer goods, and real estate. According to the Japan External Trade Organization (JETRO), total Japanese direct investment in Vietnam for the first half of this year reached US$1.169 billion, 8.3 times higher than the same period last year. Some of the major deals which have taken place this year include Mizuho buying a 15% stake from Vietnam’s largest listed bank by market value, Vietcombank, for US$567.3 million; The Sojitz Group, Daiwa House and Kobelco Eco-Solutions Company under the Kobe Steel Group constructing the Long Duc Industrial Zone in Long Thanh, Dong Nai Province at an estimated cost of US$100 million; Japan Asia Vietnam acquiring Centre Point Office Building in Ho Chi Minh City; Nikko Cordial Securities investing in PetroVietnam Securities, Unicharm acquiring Diana, etc..”
The Vietnamese real estate market is critically short of capital and developers are therefore seeking new sources of finance. These include an outright sale of the project to a third party, seeking a joint venture partner, en bloc sales of residential units, or strata sales of retail and office space, etc. Many Vietnamese developers holding large land banks are now willing to sell development land to third parties in order to raise capital to finance the construction of other projects. The financial pressure on local developers has resulted in many distressed assets in Vietnam, which on the other hand creates an unprecedented period of opportunity for foreign investors.
Although facing a number of challenges such as an immature legal framework, low market transparency, complicated licensing procedures and differences in price expectations; it is believed that the next few years will see a rising number of investment deals happening.
At the seminar, the presenter also mentioned that Savills Vietnam is a well-known international real estate service provider with more than 15-years experience in Vietnam. Particularly, in the field of real estate investment consultancy and M&A, Savills have a strong dedicated team of experts with in-depth experience and relationships with investors and developers, including domestic, regional and global players. In 2010, Savills Vietnam successfully brokered a number of real estate deals, with total transaction value exceeding US$100 million. Operating as the one-stop exchange for real estate investors and developers for deal sourcing, Savills Vietnam is in the best position to direct capital flows to where they are needed most.
For media enquiry, please contact:
Nguyen Pham Khanh Van
Corporate PR & Marketing Manager
Savills Vietnam
E: Nvan@savills.com.vn
For Investment opportunity, please contact:
Neil MacGregor MRICS BLE (Hons)
Deputy Managing Director of Savills Vietnam
E: Nmacgregor@savills.com.vn
Su Ngoc Khuong (Mr.)
Associate Director – Investment – HCMC
E: Sngockhuong@savills.com.vn
Dao Manh Hung (Mr.)
Head of Investment – Hanoi
E: Dmanhhung@savills.com.vn