In late July, the 100 percent foreign owned real estate developer Alpha King introduced three real estate projects in district 1, HCMC, including the high-end serviced apartments at No 2 Ton Duc Thang, the A-class office building Alpha Town at No 289 Tran Hung Dao and Alpha City complex at No 87 Cong Quynh.
Alpha King’s CEO Jimmy Chan said it will takes two to three years to build the projects.
Japanese Hinokiya Group has decided to cooperate with Vietnam’s TWG for its first investment project in Vietnam. According to Le Cao Minh, CEO of TWG, the two sides would set up a 50/50 joint venture to develop a Japanese style housing project, covering an area of 9.7 hectares.
FIA reported that the FDI into the real estate sector (housing, industrial production, retail, office and tourism real estate) in the first six months of 2018 reached $5.5 billion, accounting for 27.3 percent of total registered FDI.
The figure was even higher than the total committed FDI in both 2017 ($2 billion) and 2016 ($1.7 billion) thanks to several huge projects.
These include the Japanese invested smart city project in Dong Anh district in Hanoi, capitalized at $4.138 billion. The Lotte Mall Hanoi project capitalized at $600 million also has investment license.
Savills Vietnam’s deputy CEO Troy Griffiths commented that macroeconomic stability has boosted the growth of the domestic market and helped attract FDI capital flow.
Meanwhile, some analysts attribute the huge FDI to improvement in policies on attracting investment into the real estate sector. Investors are encouraged that the real estate market is among the business fields with the highest revenue.
Foreign investors have also jumped into the Vietnamese market through M&A. Nomura Real Estate has acquired 24 percent stake of Sunwah Tower in the center of district 1, HCMC.
In March 2018, CapitaLand bought a 0.9 hectare land plot in Tay Ho district in Hanoi for an apartment–office–retail complex project. The deal has expanded CapitaLand’s investment portfolio to 12 residential quarters, 1 complex and 21 serviced housing quarters in six cities in Vietnam.
Most recently, the well known Singaporean developer Keppel Land acquired 10 percent of shares in Saigon Sports City in a deal worth $11.4 million. There will be 4,300 high-end houses and infrastructure items to serve demands for sports, entertainment, shopping and dining.
The State Bank of Vietnam has tightened lending to the real estate sector in an effort to control bad debt. This has prompted Vietnamese real estate developers to seek foreign capital sources.