Singaporean real estate giant gaining huge profit in Vietnam

By Quynh Chi - Feb 24, 2018 | 08:32 AM GMT+7

TheLEADERIn 2017, Singapore-based real estate corporation CapitaLand sold 1,409 apartments in Vietnam and achieved the sales record of over VND7,900 billion (roughly US$348.25 million), up 63 per cent from the previous year.

Singaporean real estate giant gaining huge profit in Vietnam
D1MENSION project invested by CapitaLand has been outsold at the price of VND118 million (roughly US$5,201.5) per square meter.

The number of residential units in CapitaLand sold in 2017 slightly decreased compared to 1,480 units in 2016; however, the company’s sales value last year increased significantly thanks to the number of units handed over to owners.

Specifically, the company's 2017 sales value in Vietnam market is about VND7,900 billion (roughly US$348.25 million). Thus, the revenue of the Singaporean real estate giant in Vietnam has increased continuously in the past three years, with the sales value in 2017 doubled the figure for 2015.

CapitaLand said that the strong increase in the sales value last year was thanks to such projects as Feliz en Vista, Seasons Avenue, Mulberry Lanes and d'Edge.

Most of CapitaLand's projects located in Ho Chi Minh City have been outsold. For example, the corporation has sold 952 out of 973 units in the Feliz en Vista project, 1,030 out of 1,152 units in the Vista Verde project and 340 out of 344 units in the Krista project sold. 128 units in the Kris Vue project has been sold out.

The corporation has also gained positive result in the sales of projects in Hanoi, with 1,050 out of 1,300 units in the Seasons Avenue, a new project, having been sold. However, the Mulberry Lanes project still has 99 units in stock despite being handed over and put into operation for a long time.

Especially, CapitaLand has invested significantly in the luxury segment last year, with two projects in this segment namely d'Edge and D1MENSION being offered in Ho Chi Minh City.

In particular, the d'Edge project located in Thao Dien ward, district 2 was launched in the mid of last year with the price of VND63-85 million (roughly US$2,777 - 3,747) per square meters without VAT and maintenance fee. This is quite high compared to the average price of the apartment market; however, CapitaLand revealed that it has sold out 273 units in this project.

Turn 'duck' into 'swan'

One of the most impressive transactions of CapitaLand is the acquisition of the D1MENSION project worth US$52 million in 2016. This project was a joint venture between Rubber Real Estate Construction and Vinacon Investment and Development Company.

The project was started in 2011 but was delayed due to the lack of investment capital before being acquired by CapitaLand. The project consists of 302 apartments, of which the first 17-storey tower was developed by CapitaLand into a residential apartment and the second tower of 22 storeys would be the rental serviced apartments with the Somerset brand.

From a "dead" project, D1MENSION has been revived strongly by CapitaLand. Launched from mid-October last year, 63 per cent of its units have been sold at an average price of about VND118 million (roughly US$5,201.5) per square meter by the end of last year.

CapitaLand’s revenue in 2017 also increased sharply thanks to the surging number of units handed over to owners.

The total number of units that CapitaLand handed over to customers last year increased by 8.1 times from the previous year to reach 1,404 units mainly due to the handover of 731 units in the Vista Verde project at the end of the year.

Vista Verde is a high-end housing project constructed by CapitaLand Vietnam in cooperation with Thien Duc Trading and Construction. Vista Verde has four buildings with a total of 1,152 units.

CapitaLand expects to sell 2,800 units with a value of about VND12,360 billion (roughly US$544.85 million) expected to be handed over from the first quarter of this year onwards. 44 per cent of value is expected to be recognized this year.

Vietnam is CapitaLand's third largest real estate market, following China and Singapore.