News: APARTMENT SALES REMAIN STRONG IN DA NANG

(Source:bizhub.vn) 17/09/2015

Villa and apartment market

The Da Nang apartment market continued to show positive signs in the second quarter with absorption at 18 per cent compared to 11 per cent in the first quarter of this year.

A report from real estate consultancy Savills Viet Nam showed that projects by well-reputed developers and those near the beach and downtown generated good sales in the first half.

Savills said with another 13 villa and 21 apartment projects set to finish, 1,350 villas and townhouses and 17,600 apartments would hit the market in the remaining period of this year. Hai Chau District would remain the main location for apartments with a 75 percent market share and Son Tra peninsula would continue to have the largest villa supply.

Two villa projects, Premier Village Da Nang resort and Naman Residences, are offering for sale 150 more units in their latest stage in the second quarter.

This has increased the villa inventory to 890 units in 16 projects, of which the primary market accounted for 450 in 10 projects.

The property consultancy said villa absorption was 12 per cent due to the good sales performance by Premier. The average price was VND27.5 million (US$1,300) per square meter, up 9 per cent quarter-on-quarter (QoQ).

Most purchases were in the nature of investment or buying to lease.

The central city saw a 25 per cent year-on-year (YoY) increase in tourist arrivals in the first half to 2.23 million. The number of international visitors was 600,000, an increase of 33 per cent, while domestic visitor numbers rose 22 per cent.

Hotel segment

In the hotel segment, there were 7,050 three- to five-star rooms, a 10 per cent QoQ and 32 per cent YoY rise.

The increase was a result of the official ranking of eight hotels.

Three-star hotels accounted for 3,050 rooms, accounting for 43 per cent, followed by five-star (34 per cent) and four-star (23 percent).

The average rental rate (ARR) increased by 8 per cent YoY to VND1.78 million ($84.7) per room per night, while revenue per available room (RevPAR) grew 13 per cent YoY. ARR and RevPAR increased across the board.

The overall occupancy rate increased by 4 percentage points YoY to 74 per cent, while the three-star segment achieved the highest occupancy, followed by five- and four-star.

In the second half of this year 38 developments with approximately 8,570 rooms are expected to be completed.

By 2017 another 2,400 rooms would be added by eight new hotels, six of them in the beach area.

The number of visitors arriving in Da Nang by air in the first six months was 268,275, double the number in the same period last year.

The city has 23 direct international flights to destinations in Japan, Korea, Malaysia, Singapore, China, Hong Kong, Cambodia, and Europe.

Office supply

In the second quarter the total stock of office space was 86,500sq.m in 25 buildings, a 13 per cent increase QoQ and YoY.

Busy Hai Chau District continues to be the main supplier with 63,000sq.m in 20 buildings.

In the second quarter the average occupancy was 83 per cent, a 3ppts fall QoQ, while the average rent was down 2 per cent to VND213,500 ($10.1) per square meter per month.

The average grade A rent increased by 1 per cent QoQ, while both grades B and C saw a 1 per cent fall.

Current supply of office for lease segment in QII/2015

In the first six months of this year 1,495 new businesses were started with a registered capital of over VND6.06 trillion ($269 million).

Savills estimated that around 266,000sq.m in 18 projects would come into the market starting in the second half of this year though many have yet to announce launching dates.

In overall, only one new project is expected to enter the city's office market in 2015, supplying approximately 20,400sq.m

Retail sector

In the second quarter the retail sector saw a 24 per cent increase QoQ and 30 per cent increase YoY with a total availability of 167,000sq.m.

The figure was due to the entry of Vincom Ngo Quyen Da Nang, a mall on the Han River with an area of 40,000sq.m and costing VND900 billion (US$43 million).

News: FOREIGNERS CAN'T BUY, SELL HOUSES WITH CASH(Source: baodanang.vn) 17/09/2015

Foreigners buying or selling houses in Viet Nam are required to carry out transactions through banks in the country and not in cash, the central bank has decreed.

They can get mortgages if they meet banks' requirements, the State Bank of Viet Nam (SBV) said further in a document it has issued to guide the buying and selling of houses by foreign individuals and organizations.

The tenor of the loans cannot exceed the time they live and work in Viet Nam, while for organizations and other legal entities; it will not exceed their license period.

Amendments to the Housing Law that took effect on July 1 permit foreigners and overseas Vietnamese to buy housing if they have a visa to enter the country.

They can buy, lease out, gift, and inherit property.

There are a few restrictions, one of which is that combined foreign ownership should not exceed 30% of an apartment project.

News: BIDDING NORMS FOR TOURISM INVESTMENT ON HAI VAN PASS(Source:baodanang.vn) 18/09/2015

Da Nang City People's Committee has issued the Decision No. 6573 / QD - Committee approved some basic indicators as the basis for implementing the bidding work for Hai Van Pass attraction.

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Hai Van Pass

Accordingly, the total investment is expected to be no less than 50 billion dong under the form of domestic investment with the implementation progress in the period of 2016-2017.

Given a land using area of 6,100 m2, the project aims to build a tourist attraction accommodating sightseeing, shopping and entertainment for locals and visitors; to create a cultural connecting

and exchanging environment to contribute to the improvement of material and spiritual life for local residents through local services, concurrently to create highlight and driving force for the City’s tourism development.

The main items under the approved planning including management building, kiosk combining public toilets ; kiosks cluster for selling souvenirs; kiosks for refreshment; sightseeing area ; parking area, green trees and lawns, pavilions for sightseeing as well as the improvement of Hai Van Quan landscape.

During the investment project planning, investors are requested to analyze and assess the natural conditions, socio-economic status, population, labor, land using, status of social and technical infrastructure construction, urban sanitation and especially national security factors affecting the design plans and project planning...

Reportedly, Hai Van Pass is one of the most attractive destinations in Central Vietnam for both domestic and foreign visitors. The Hai Van Pass Stop has been listed in Da Nang – Hue tour of many travel agencies so far. The total number of visitors at Hai Van Pass in 2014 was estimated at 439,000 visits, of which approximately 60 % were international visitors.

News: WHICH PLAN FOR DA NANG INFORMATION TECHNOLOGY PARK? (Source: cadn.com.vn) 18/09/2015

To ignore “ultimatum”

To show determination to revoke the project, dated 3-7-2015, the Standing Party Committee issued the Notice No. 364 / TB- TU guiding City People’s Committee to work with relevant agencies and departments to research and propose procedures on suspending the project ensuring strict compliance with the law.

Da Nang Information Technology Park was signed land lease contract on 06/2014; however, the site clearance work has been long-delayed in implementation compared to the committed schedule.

Perspective of Da Nang IT Park in Hoa Vang District.

Referring to the question why the City has not revoked the project, Leaders of Da Nang Natural Resources and Environment Department said that pursuant to its investment certificate and the actual situation of the project, there has no basis for the land retrieval.

It is explained that, pursuant to the Law of Investment 2014, a project will be revoked if it failed to be commenced within a period of 12 consecutive months or more than 24 month behind schedule compare to the implementation progress clarified in the Investment certificate upon the land handing over on site. While the first phase of this project specified in the IC is from 2013-2017, it means 2 years still remaining for the withdrawal.

From 2012 to date, this "super projects" has merely deposited a very modest amount into the City budget of USD 200,000 and also failed to execute its other financial obligations. Meanwhile, the total amount that must be refunded by Rocky Lai Group to the City is nearly 100 billion VND and 10 billion VND penalty for the late payment in according to regulations of existing Laws.

To change owner?

Mr Paul Ta, Deputy CEO Rocky Lai Group ( who owns 11 % shares of the project), admitted that the delay in project implementation as its commitment was due to both objective and subjective reasons. But the crucial one is the lack of financial capacity due to the unexpected capital drawing of shareholders. However, Mr.Paul Ta still affirmed his wishes to continue implementing this project and requested the City to allow Trung Nam JSC to contribute its capital into the project.

Reportedly , Trung Nam JSC is initially committed to make payment of 126 billion of debts such as land using fees, site clearance and resettlement fees, fees for investment preparation and willing to pour 300 billion dong to accomplish infrastructure in the first phase.

Besides, to effectively exploit Golden Hills by using redundant soil in grade work at the IT Park to put into Golden Hills project (whose owner is Trung Nam group).

According to Mr.Pham Kim Son – Director of Information and Communication Department, the allowance of the investor to assign its shares to Trung Nam JSC will help the project be funded and accelerated its progress while the City to be enable to retrieve 100 billion dong to reinvest in infrastructure of the City.

He also assessed that the suspension and revocation of investment of IT Park project will face many obstacles due to regulations in the Land Laws 2014. Therefore, he proposed the City to permit Rocky Lai Group to have its shares assigned to Trung Nam JSC. “The share assignment of holding shareholders is totally lawful pursuant to existing Laws. However, Rocky Lai Group and Trung Nam JSC have to enter into a commitment minutes to execute the project.