Vietnam’s economy witnessed the strongest first-quarter growth over the last 10 years, increasing 7.38 percent year-on-year (YOY) in the first quarter of 2018 and expanding the strong momentum demonstrated in the second half of 2017.
Market position also stays optimistic across all industries of the economy. Vietnam’s real estate market has also seen dynamic investment activities across many industries in the first quarter of 2018.
Specifically, the city’s office market persisted to mark healthy demand and high occupancy in the first quarter of 2018. Nevertheless, owing to the shortage of available properties for sale, there were very few investment transactions in this industry.
One of the most prominent transaction was the acquisition of Nomura Real Estate in January for a 24 per cent ownership interest in Sun Wah Tower, a Grade A office building in Ho Chi Minh City.
Generally, the real estate market remained an alluring prospect for developers interested in mixed-use projects with residential components in large cities.
Additionally, investors were also seeking to obtain development sites and properties in the country’s hospitality sector, in the context of increasing consumer demand and rising overseas arrivals to Vietnam.
In January, Japan’s Mikazuki Hotel Group announced plans to invest $100 million in a project in Danang city in a nearly 11.5 hectares space. The development aims to accommodate a five-star hotel, waterpark, theme park and F&B complex fronting the beach in Danang city.
Furthermore, in the first quarter, a Vietnam-based investment firm, Bamboo Capital, obtained the Malibu resort project for approximately $14.8 million from Indochina Hoi An Beach Villas Co., Ltd.
In March, CapitaLand acquired an approximately 0.9 hectare site in a prime location within Hanoi’s Tay Ho district for a project which will will contain a 380-unit residence, around 21,400 square metres of office space and more than 19,300 square metres of retail space.
This latest acquisition will augment CapitaLand’s portfolio to 12 residential developments, one integrated development and 21 serviced residences, across six cities in Vietnam.
In addition, Singaporean developer, Keppel Land, acquired the remaining 10 per cent stake in Jencity Limited, which owns Saigon Sport City, for roundly $11.4 million. Saigon Sports City is a 64 ha township that Keppel Land is developing in the prime District 2 in Ho Chi Minh City.
The township will contain about 4,300 premium homes and Vietnam’s first one-stop lifestyle hub with comprehensive facilities for sports, entertainment, shopping and dining.