CapitaLand steps up momentum in Vietnam with eighth residential development as the country becomes one of its fastest growing markets in Southeast Asia
Special preview of its best-selling Vietnam properties in Singapore receives strong interest
Singapore, 27 October 2015 – CapitaLand Vietnam has entered into a joint venture with Saigon Commercial & Tourism Corporation, a subsidiary company of Thanh Nien Corporation (Thanh Nien) to develop a prime site in District 2 at Ho Chi Minh City, for an estimated project value of US$55 million (approximately S$78 million). This will mark CapitaLand’s sixth residential project in Ho Chi Minh City, and its eighth in the country. The expansion, pending regulatory approval, comes hot on the heels of the joint venture CapitaLand has established with Thien Duc Trading-Construction Company in June 2015 to develop a S$200 million, 1000-unit upscale project in District 2.
The latest site, located in the expatriate community of Thao Dien ward, will be two kilometres from the new Metro line, a 10-minute drive to the future Thu Thiem Central Business District (CBD) in District 2 as well as a 15-minute drive to the existing CBD in District 1. There are plans to develop a one-hectare residential development with approximately 350 units. With its proximity to amenities like shopping malls, cinemas and established international schools such as the British International School, Australian International School and European International School, good housing demand is expected from a ready pool of tenants.
CapitaLand will hold an 80% stake and Thanh Nien will hold the balance 20% stake in this joint venture. Thanh Nien is an established Vietnamese enterprise with several property developments in its pipeline offering potential for further collaboration.
Mr Chen Lian Pang, CEO of CapitaLand Vietnam, said: “CapitaLand is one of the topperforming foreign developers in Vietnam in the first nine months of 2015 when it sold 873 units, achieving sales of about S$138.5 million. As at end June 2015, CapitaLand’s total asset size in Vietnam is S$618 million. This CapitaLand-Thanh Nien partnership will increase CapitaLand’s residential portfolio in Vietnam to about 7,850 homes across Ho Chi Minh City and Hanoi. It also presents long-term business relationship potential as we explore more development opportunities with Thanh Nien for several other projects in its pipeline.”
In July 2015, a slew of legislative changes were announced to allow foreign investment and ownership of real estate in Vietnam. For instance, foreigners previously could only lease one property in Vietnam. Now, foreigners can buy and own more than one 50-year leasehold property in Vietnam for their own occupation, lease or sell it. In addition, Singapore developers will now be able to not just sell their units onshore in Vietnam, but also market them in Singapore.
Mr Lim Ming Yan, President & Group CEO, CapitaLand Limited, said: “As a committed and long-term developer in Vietnam, CapitaLand welcomes the opening of its property market to foreign investment and ownership in July. This bodes well for the healthy development of Vietnam’s real estate market. Coupled with the country’s strong economic growth forecast of 6.5% and continued population growth, Vietnam is now CapitaLand’s third largest market in Southeast Asia and one of our fastest growing in the region. Backed by our 20-year track record in Vietnam as a reputable developer and international serviced residence owneroperator, we will continue to expand our presence in Vietnam via good investment and management opportunities.”
CapitaLand will be holding its maiden launch of two of its Vietnam properties in Singapore – Vista Verde and The Vista – on 7 and 8 November 2015. This comes after the special preview held earlier on 25 October 2015 where the two residential developments received strong interest from investors in Singapore. Both Vista Verde and The Vista are within a 15- minute drive from the existing CBD in District 1, and offer panoramic views of the Saigon River and city skyline. These two projects also offer comprehensive lifestyle amenities and the convenience of retail units at their doorsteps.
Mr Chen Lian Pang added: “For the first time, we will be launching two of our best-selling Vietnam developments, The Vista and Vista Verde, in Singapore. We are heartened by the good response during the special preview as many buyers are interested in Vietnam real estate due to its good value. We are offering limited units of The Vista for what will be the first rental guarantee scheme in Ho Chi Minh City. These units come with guaranteed rental yield of 6% per annum for two years and will be managed by The Ascott Limited. Vista Verde, which was just launched last September, has sold over 80% of its launched units. We will offer choice units at the premium Orchid Tower of Vista Verde during the Singapore launch. With our launched projects in Ho Chi Minh City averaging about 90% sales, we are confident that our quality, well-designed and ideally located developments will be highly sought after by investors.”