While property developers from Japan, Korea and other countries are holding off on investments in Vietnam, Singaporean developers are stepping up their involvement in this country.
Singapore-based Keppel Land International Limited last week announced it had signed a joint-venture agreement with Tien Phuoc Company to develop an 11 hectare waterfront residential site for 175 villas along the Saigon river in Ho Chi Minh City.
This is the second agreement Keppel Land has signed with Vietnamese partners this month. Ang Wee Gee, executive director and chief executive officer of Keppel Land International Limited, said the project would serve the growing middle class, “who have become more discerning in their choice of residences and where they set up their businesses”.
Keppel Land previously entered into a joint venture with Tien Phuoc and another partner, Tran Thai, through its wholly-owned subsidiary Flemington Investment Pte Ltd to develop a residential area in District 2.
Another Singaporean property developer, Sembcorp Parks Holdings, last week also broke ground at a 1,600ha integrated township in the northern city of Haiphong through the Vietnam Singapore Industrial Park and Township Development Joint Stock Company (VSIP), a joint venture with Becamex IDC Corporation.
The integrated township, once completed, will comprise a financial centre, commercial belt, shopping malls, hotels and medical centres. VSIP expects the township to meet the needs of about 150,000 residents.
At the groundbreaking ceremony, VSIP signed a memorandum of understanding with another Singaporean developer, GuocoLand Vietnam Company Limited, to build a residential area on the site.
GuocoLand Vietnam is also building the $50 million The Canary commercial and residential project at VSIP I Industrial Park in the southern province of Binh Duong. At the same time, investors such as Japan’s Riviera Corporation and Intra Corporation and Korea’s IGS Capital have delayed their investments in Vietnam due to the global financial crisis.
In a recent meeting with the Ministry of Planning and Investment, a senior leader from Keppel Land said the rising demand for accommodations in Vietnam was offering lots of opportunities for property developers.
Last November, Keppel Land launched the Riviera Cove project, comprising a total of 96 villas in District 9. Company officials said that about 48 of the development’s 60 select villas were sold within a month. The company was also considering new investments in the north, especially in Hanoi.
CapitaLand, a Singaporean property developer, last week also signed a joint venture agreement with Hoang Thanh Investment and Infrastructure Development Joint Stock Company, to jointly develop a 14,000 square metre residential site in the new Mo Lao urban area in Hanoi.
Liew Mun Leong, president and chief executive officer of CapitaLand, said the company was confident in the growth prospects of the Hanoi real estate sector, as it was supported by healthy economic growth, rapid urbanisation and a young and growing population.
“Vietnam is our fourth pillar of growth after our core markets in China, Singapore and Australia. We target to grow our business in Vietnam to 10 per cent of the group’s total assets, up from the current 1 per cent, over the next three to five years,” Liew said.