High-end real estate 'king' Tan Hoang Minh undergoes radical changes

By Giang Son - Oct 26, 2017 | 02:51 PM GMT+7

TheLEADERTan Hoang Minh Group has received more positive feedback after changing its business strategy

High-end real estate 'king' Tan Hoang Minh undergoes radical changes
D’. Capitale project on Tran Duy Hung street, Hanoi

Tan Hoang Minh’s D’. Capitale project, which consists of six 39-floor towers, may change the developer’s image when it is handed to customers by the end of next year as committed.

Construction progress is one of the revolutionary changes of Tan Hoang Minh (THM). Previously, THM’s projects are located in the centre of Hanoi, so the complicated investment procedure and the meticulous refinement are time-consuming.

Since the end of last year, Tan Hoang Minh has accelerated the construction progress, by employing such leading contractors as Coteccons and Delta.

However, the most significant change at THM in the past years has been its target customer base. Previously, THM only focused on high-end real estate projects, serving the affluent customer segment. With D'. Capitale and D'. El Dorado, THM has expanded its client base to the young and middle-class segment.

Do Anh Dung, THM Chairman, stated that this change results from listening to the needs of consumers and partners. Apparently, the difficulties in selling D'. Palais de Louis apartments have forced Dung to recalculate the demand for the super-luxury market and thereby re-plan their investment.

Dung says there is still a high demand for apartments at prime locations with nice design and reasonable price.

But how can THM reach new customers when THM’s projects are thought to be exorbitantly expensive? If they “stick” to the central area of Hanoi, THM can hardly reduce the selling price due to high land costs and complicated procedures. Land costs usually account for 20-30% of the price of an apartment.

Therefore, instead of "sticking" to Hanoi's central districts such as Dong Da, Tay Ho, Hoan Kiem, THM has focused on new ones such as Cau Giay, Hoang Mai, Nam Tu Liem, where land prices are lower. Starting this "centrifugal" trend are the D’.Capitale project in Cau Giay district and, most recently, Tan Hoang Mai urban area in the centre of Hoang Mai district.

Also, instead of investing in projects with a few hundred apartments as before, THM’s new projects have much more apartments. Large scale is an advantage for THM in negotiating with suppliers on building materials and equipment prices. Shorter construction time and lower financial costs also help decrease product price. However, as the projects are situated at prime locations for convenient transportation, near the park or lake, their prices are still high compared to other urban projects.

Do Anh Dung, THM Chairman

Besides, THM also closely cooperated with Tecombank to buy mortgages for customers, so customers who have accumulated 30% of the contract value is eligible to buy D'. Capitale apartments.

THM also minimises the luxurious refinement details and reduces the area to slash apartment price.

The "revolution" of Tan Hoang Minh is showing positive results. Such distributors as STDA, Dat Xanh Mien Bac, Danko, who previously stood outside the current, have also joined hands with THM.