Local estate developers hunt for foreign capital
Local estate developers hunt for foreign capital
As the domestic financial sources are limited, Vietnamese real estate developers tend to seek capital foreign capital and look for their opportunities by cooperating with foreign firms.
The Hoa Binh Construction and Real Estate Trade JSC signed a series of contracts with foreign investors and contractors in the first eight months of the year.
In July 2013, the company signed a VND400 billion contract on undertaking a part of the SORA gardens I in Binh Duong City new city project. This is a package deal belonging to the Japanese invested Tokyu Binh Duong Garden City, which has the total investment capital of $1.2 billion.
At the end of the second quarter of 2013, Hoa Binh signed a contract on undertaking the management over GEMS, a high end house – shopping mall – hotel complex in Yangon, Myanmar.
In May, Jesco Asia, the foreign partner in Hoa Binh, poured tens of billions of dong to upgrade the designing, the electro-mechanics and infrastructure execution.
In late March 2013, PT Nikko Securities Indonesia spent over $10 million to buy HBC shares at the prices higher than the market price.
Khang Thong, also a big real estate group, has been “hunting” for foreign capital to develop Happy Land project in Long An province and the Nhon Hoi petrochemical oil refinery project in the province of Binh Dinh.
President of Khang Thong Group--Phan Thi Phuong Thao said Khang Thong is expecting the capital flow from the Arabian billionaire Thureign Augn and Hypo Commerce Bank.
The foreign investor is expected to pour capital into Khang Thong which would be put into the two projects in Long An and Binh Dinh.
Also according to Thao, the first phase of the Happy Land project alone--which is under the execution in Long An, Khang Thong has successfully called for more than 10 foreign investors. It is expected that some items of the $2 billion amusement park would be put into operation by 2014.
The businesswoman admitted that she has been relying on foreign capital, because it’s very difficult to mobilize capital from domestic sources in the current difficult conditions.
In fact, the global economic crisis has had big impacts on international investors’ cash flow, which has led to the delay in the implementation of the projects.
Meanwhile, Hoang Anh Gia Lai, a big shark in the real estate market, now focuses on hunting for the opportunities overseas. While other real estate developers try to seek foreign capital to develop projects domestically, Hoang Anh Gia Lai brings domestic capital abroad to develop projects there.
Hoang Anh Gia Lai’s President Doan Nguyen Duc has confirmed that in 2013, the group would gather its strength to develop the complex project in Myanmar.
Duc has decided to raise the investment capital of the project from $300 million to $440 million and speed up the construction in a hope that he would earn big money when the Myanmar real estate market heats up.
“As the domestic market is stagnant, it’d be better to seek opportunities overseas,” Duc said.
Not only the big guys, small investors have also been trying to look for foreign capital, considering this the profuse “baby bottle”. The investor of an apartment project in district 8 in HCM City said he is negotiating with some foreign investors to continue the half-finished project.
“The foreign investors are mostly from Asia, especially from South Korea,” he said.
vietnamnet
