Foreign capital influx permeates southern real estate market

26/11/2024, 02:00

Foreign investors flock to invest in southern provinces and cities

Foreign investment are continuously poured into the real estate market in southern localities, resulting in the emergence of a series of new property projects in the past eight months.

According to data reported by the General Statistics Office (GSO) under the Ministry of Planning and Investment (MPI), the disbursement of foreign direct investment (FDI) continued to increase in the reviewed period.

The country attracted 2,247 new projects with a total registered capital of nearly 12 billion USD, up 8.5% and 27% year-on-year, respectively. Of the figure, 2.4 billion USD was invested in real estate projects, accounting for 20% of the total.

Troy Griffiths, Deputy Managing Director of Savills Vietnam, commented that the FDI influx have been quite strong in the last 3-4 years, adding that they have begun permeating the market, and FDI projects have begun to be implemented.

Notably, TT Capital Investment JSC, along with two partners from Japan—Cosmos Initia (a member of Daiwa House Group) and Koterasu—recently collaborated to develop affordable housing in Binh Duong and neighbouring provinces.

This joint venture announced an investment of about 150 million USD over the next five years, aiming to deliver thousands of affordable apartments to the market each year. The venture has completed its capital contribution for a 2,000-apartment project in Di An city, which is scheduled to inaugurate in the third quarter of this year.

Meanwhile, Kim Oanh Group also signed an investment cooperation agreement for a 1-billion-USD urban area project in Binh Duong with three Japanese partners, namely Sumitomo Forestry Group, Kumagai Gumi Group, and NTT Urban Development Asset Management Corporation.

Bcons Group, a company with several social housing projects in Binh Duong, is also partnering with Asset Limited from Thailand to develop 11 housing projects totaling nearly 9,000 affordable apartments in Binh Duong. Recently, Bcons announced its plan to build more than 2,000 social housing units in Di An city in 2025.

Most recently, in August, Daewoo E&C from the Republic of Korea (RoK) decided to invest an additional 105 million USD to develop an over-55-ha real estate project in Dong Nai province.

In July 2024, Nova Service Group, a member company of NovaGroup, announced that it was negotiating with a RoK company to develop the NovaWorld Phan Thiet project.

Meanwhile, Electronic Tripod Vietnam Co., Ltd., a subsidiary of Tripod Technology Group of Taiwan (China), acquired an 18-ha industrial land plot in Ba Ria - Vung Tau province from Sonadezi Chau Duc.

According to Trang Bui, General Director of Cushman & Wakefield Vietnam, from the end of 2023 to the first half of 2024, the real estate market recorded 16 merger and acquisition (M&A) deals. Foreign investors are mainly looking for clean land funds with great potential for future development.

Keisuke Muraoka, representative of Cosmos Initia Joint Venture from Japan, said that when deciding to invest in Vietnam, the investor had carefully researched the market and its potential. He added that in the southern market, the mid-range segment is the most feasible for development./.