Ho Chi Minh City got a 68-story skyscraper, Vietnam’s tallest, when the downtown Bitexco Financial Tower was inaugurated in 2010. The building, boasting a helipad at the 50th floor, can be seen from almost every part of the city.
It hasn’t been a celebration for the owner, however. Nearly 18 months later half of the building’s office space is still empty and none of the six retail podiums is open. Annualized interest rates reached as high as 23% late last year, and there are plenty of rumors that the owner is trying to sell the building to pay off construction loans. But the company dismisses them. “Bitexco Financial Tower is our pride; we are not selling it,” says Vu Quang Hoi, chairman of Bitexco, a private Vietnamese company that’s invested in more than a dozen other real estate projects, plus infrastructure, energy and mining. “This is a difficult time for businesses, but it is precisely why we need to continue to invest more.”
Friday, March 30, 2012
Wednesday, May 18, 2011
Vietnam mulls ban on unfinished home sales
An incomplete mansion in Hanoi
The Ministry of Construction has proposed a new rule that bans project developers to sell land and half-built houses to customers.
Residential property developers must finish construction before being allowed to sell their projects, the rule said.
In its latest report on the real estate market, the ministry found that many people cannot afford a house while some others have been leaving their houses unfinished and unoccupied for a long time, which it said is a waste of land resources.
An inspection of 18 residential projects in Hanoi found that only 80 percent of townhouses and 50 percent of villas were put into use, according to the report.
The Ministry of Construction said it is necessary to control bank loans to real estate projects, especially in the high-end market segment. Uncontrolled credit to luxury housing and resort projects can cause the market to collapse, the ministry warned.
The Ministry of Construction has proposed a new rule that bans project developers to sell land and half-built houses to customers.
Residential property developers must finish construction before being allowed to sell their projects, the rule said.
In its latest report on the real estate market, the ministry found that many people cannot afford a house while some others have been leaving their houses unfinished and unoccupied for a long time, which it said is a waste of land resources.
An inspection of 18 residential projects in Hanoi found that only 80 percent of townhouses and 50 percent of villas were put into use, according to the report.
The Ministry of Construction said it is necessary to control bank loans to real estate projects, especially in the high-end market segment. Uncontrolled credit to luxury housing and resort projects can cause the market to collapse, the ministry warned.
Saturday, May 14, 2011
UAE investments in Vietnam have reached $3 billion
The UAE spent $130 million in direct investments in Vietnam, while additional indirect investments such as joint ventures and securities brought the total figure to $3 billion, said Vo Hong Phuc, Vietnamese Minister of Planning and Investments after signing a Memorandum of Understanding with Emirates Gate Investment yesterday. "The aim is to facilitate UAE entrepreneurs to invest in Vietnam," he said, adding that a host of UAE firms are already investing in Vietnam and more continue to show interest.
"Investment from the UAE to Vietnam is modest but I see potential for the future," he told reporters after the event. Key investment sectors include manufacturing, energy and infrastructure, he added.
"Investment from the UAE to Vietnam is modest but I see potential for the future," he told reporters after the event. Key investment sectors include manufacturing, energy and infrastructure, he added.
Tuesday, May 10, 2011
Vietnam office rents among the highest in the world
HO CHI MINH CITY: The office rent rates in Vietnam’s biggest cities such as Ho Chi Minh City and Hanoi are among the highest in over 100 markets worldwide, according to an annual report released by British real estate services firm Knight Frank last week.
Ho Chi Minh City is the 19th and Hanoi (21st) most expensive markets with prime rents at US$38 and US$36.5 per square metre per month respectively, the report said.
The rates are more expensive than established markets like Manhattan (New York), Frankfurt (Germany ), Shanghai (China ), Brussels (Belgium ) and Rome( Italy), according to the Vietnam news agency.
However, the availability has increased in Vietnam, with both the cities seeing large amounts of new Grade A office supply during 2010.
This has caused vacancy rates to rise and put pressure on Grade A rents.
Meanwhile, demand remains strong in the Grade B and C office sectors, according to the report.
Elsewhere, the rental growth has been led by the world’s major financial centres, with office rents rising in cities such as London, New York, Hong Kong and Singapore, said the report.
Ho Chi Minh City is the 19th and Hanoi (21st) most expensive markets with prime rents at US$38 and US$36.5 per square metre per month respectively, the report said.
The rates are more expensive than established markets like Manhattan (New York), Frankfurt (Germany ), Shanghai (China ), Brussels (Belgium ) and Rome( Italy), according to the Vietnam news agency.
However, the availability has increased in Vietnam, with both the cities seeing large amounts of new Grade A office supply during 2010.
This has caused vacancy rates to rise and put pressure on Grade A rents.
Meanwhile, demand remains strong in the Grade B and C office sectors, according to the report.
Elsewhere, the rental growth has been led by the world’s major financial centres, with office rents rising in cities such as London, New York, Hong Kong and Singapore, said the report.
Monday, July 5, 2010
Vietnam Real Estate Report Q3 2010 - New Market Report Published
There is a property glut in Vietnam. Rental rates fell by double digit rates through 2009 - in each of the three cities for which we gathered data (Hanoi, Ho Chi Minh City and Da Nang) and across all three subsectors. Vacancy rates are generally running at around 30%.
Normally, in an economy that has been growing so quickly - that the authorities are tightening both fiscal and monetary policy in order to curb inflationary pressures - rents and capital values would fall until much of the vacant space is absorbed.
However, this is not the process of adjustment that is under way in Vietnam. The government has intervened to re-regulate the commercial Real Estate sector. Approvals for projects that have been proceeding slowly have been revoked. The aim of this measure may be to prevent/discourage speculation in a country where inflation has been rising. More likely, it is a move to curb supply at a time that rental rates are under downwards pressure.
Normally, in an economy that has been growing so quickly - that the authorities are tightening both fiscal and monetary policy in order to curb inflationary pressures - rents and capital values would fall until much of the vacant space is absorbed.
However, this is not the process of adjustment that is under way in Vietnam. The government has intervened to re-regulate the commercial Real Estate sector. Approvals for projects that have been proceeding slowly have been revoked. The aim of this measure may be to prevent/discourage speculation in a country where inflation has been rising. More likely, it is a move to curb supply at a time that rental rates are under downwards pressure.
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