VietRees Newsletter 38 Week1 Month07 Year08

8/14/2019 VietRees Newsletter 38 Week1 Month07 Year08

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Vietnam Real Estate Newsletter A38

VietRees Vietnam Real Estate Web: www.VietRees.com Email: [email protected] Week 1 July, 2008

NEWS BULLETIN FOR PROFESSIONAL REAL ESTATE INVESTORS, PLANNERS, DEVELOPERS AND MARKETERS

English Edition Editorial Board: VietRees Market Information Department and renow.com.vn

A member of:

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This is a weekly newsletter issued by VietRees Vietnam Real Estate. This is shared with partners, clients, members (registered) and internal VietRees together with those who are concerning ornterested in Vietnam real estate market changes. Although the information is selected, synthesized from all reliable sources, this newsletter is only for reference and VietRees is not responsible forhe occurring damage. Please visit the website www.VietRees.com for further Vietnam Real Estate information. VietRees states clearly the original sources and dates for your convenient tracking or

getting full information. Should you need any queries or register to receive the newsletter, please contact via [email protected].

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Weekly issued

to 7,000registeredmembers,

approximately

20,000 readsper week or

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Section A GeneralMarket Information

completely presents thewhole market with hot

news, foreigninvestment, real estatecompany, real estate

new developments andall necessary legal

news.

Section B ResearchResults & Statistics

provides marketstatistics including

pricings ofdevelopments, market

prices and constructionmaterials prices, real

estate overall statistics,newly announced

developments everyweek and month,

approved developmentsfor construction and

VietRees forecasts onthe market and VN-

Index stats.

Section C Utilities &Speciality Newsconsists of usefulselected articles,

reports and analysis.

Please stay tunedwith the

Real EstateInvesting Newsletter

issued by VietRees everymonth. The newsletter

introduces fully legitimatedevelopments that are

calling for investment and

acquisition.

Joining with VietRees todevelop this weekly newsletter

SECTION A - GENERAL MARKET INFORMATION

A1-MARKET HOT NEWS

Source: SaiGonTimes Source: Thanh Nien1. Foreign enterprisesremain optimistic aboutreal estate

30 Jun, 2008

2. House for rent and saleneeds developing

02 Jul, 2008

Although real estate market in Ho Chi Minh City andlarge urban areas is suffering a dramatic drop,transaction volumes are plummeting with many foreignenterprises still have high expectations on this industry.Many foreign investors still have been confidence tolaunch new projects targeted on premium marketsegment such as Blooming Park high-end apartmentbuilding (District 2), Cantavil Hoan Cau apartment (BinhThanh District), and Raffles Residences (Da Nang City).

Besides project introduction, many investors are stillcontinuing to look for opportunities in Vietnam whereashome investors are facing full of hardships. It is said thatdifficulties that real estate market in Vietnam isencountering are only on temporary basic, but housingneed of residents is getting higher. That is the reasonwhy foreign investors are making every effort to searchnew projects while the market is keeping quiet.

Some consulting companies judge that the real estatemarket in Vietnam still has been on the growth path inthe long term. Till late 2009 early 2010, when economyis stable, along with support of new policies, apartmentmarket is said to become eventful again. However, dueto tightening policies on bank loans and loan interest

rates and rising construction costs, many investors arepostponing project progress or give up their projects.This fact also partly affects the supply til after 2010.

The decrease in prices and purchasing power ofhigh-end apartments in the past have shown thatsupply is being superfluous. The current market isflooded with apartments whose prices are not lessthan 20 million VND per s.q.m.

Although real estate market is slowing down,according to estimation of United Nations SettlementProgram, with current property prices in Vietnam,

over 80% people who have housing needs cannotafford to buy houses.

Laws on housing initially offered constructionmechanism of social houses to meet housing needsof low-income earners. Government will invest inconstruction of houses for lease or sale. DespiteGovernments approval, after a 2-year pilot, Ha Noi,Ho Chi Minh and Binh Duong have just built upmechanism and researched new projects.

House management Bureau said that, current Statepolicies are enough to encourage investors to joinmarket segment of cheap houses. The remainingwork is self-adjusted by the market. According toexperts, enterprises should take part in developing

housing market for lease and sale rather thanbuilding small and cheap houses for sale. In fact, thisis a common tendency around the world.

A2-REAL ESTATE FOREIGN INVESTMENT

Source: VietRees Source: Vnagency3. Trang Cat urban area and hi-tech park

30 Jun, 2008

4. 3,5 billion USD invested inbuilding Viet NamInternational University Town

02 Jul, 2008

Hai Phong Peoples Committee has chosen thealternate layout of Trang Cat urban area and hi-techpark, Hai An District, with total area of 934,79hectares,which is invested by Foxconn (Taiwan)Corporation, Saigon Investment Corporation in

cooperation with Kinh Bac Urban Development JSC.The project in Trang Cat will play a role as a new modelin which Sea Urban Area integrated with hi-techmanufacturing activities, trade centers, ecologicaltourism, sea activities, Golf Course, and other floatingterraces. A very large square area in the layout of theproject has been made up from sea re-claimed land.

01/07/2008, HCMC Peoples Committee granted thepermit to Berjaya Leisure company (Cayman-belonging to Berjaya Land Bhd Corporation-Malaysia) to invest in its development project of VietNam International University Town (VIUT), with total

investment of 3,5 billion USD. The project is locatedat Tan Thoi Nhi commune, Hoc Mon suburban.

VIUT covers a total area of nearly 925 ha andincludes International University Town, 12 schools ofall levels, trade center, administrative center, healthcare center, entertainment area... The project isexpected to commence construction in early 2009.

Insightful Real Estate Market Information And Research: Please contact VietRees, theprofessional real estate researching and consulting company in Vietnam. We specialized ininspecting demands and performing behavioral analysis on current customers, targetedcustomers and potential customers in the real estate business sector in order to assist andadvise real estate companies developing a perfect business and marketing plan thatsucceeds in satisfying customer demands to its best. Furthermore, VietRees carries out awide variety of researches including possibility analysis, competition analysis, mediamarketing analysis and real estate valuating services.

Information regardingpublishing:

On June 14th

2008, VietReesand The NOW Group renow.com.vn have signedan agreement on cooperating

and developing the VietnamReal Estate Newsletter.


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This is a weekly newsletter issued by VietRees Vietnam Real Estate. This is shared with partners, clients, members (registered) and internal VietRees together with those who are concerning ornterested in Vietnam real estate market changes. Although the information is selected, synthesized from all reliable sources, this newsletter is only for reference and VietRees is not responsible forhe occurring damage. Please visit the website www.VietRees.com for further Vietnam Real Estate information. VietRees states clearly the original sources and dates for your convenient tracking or

getting full information. Should you need any queries or register to receive the newsletter, please contact via [email protected].

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A3-REAL ESTATE COMPANY EVENT

Source: DDDN Source: Thanh Nien5. Officially offer E.Home apartmentsfor sale

28 Jun, 2008

6. Mien Dong Housing Cooperative to beestablished

30 Jun, 2008

On June 28, ADC Nam Long Apartment Development Corporationofficially inaugurated model houses and offered the first project ofE.Home product lines named E.Home - Eastern Saigon 1, in District9, HCMC for sale.

The project comprises 3 blocks of 5 storey apartments with 312units, which each 50-100m2 in size. Total square area of the projectis 10.253m2. It is located in a pure-air area which is smartlydesigned to optimize every using square meter.

Mien Dong Housing Cooperative has just been established in BaRia- Vung Tau province with its expected charter capital of about 10billions VND and specializes in the fields of house, land,construction...

The first project of the cooperation is 2 blocks of 9-12 storeyapartment buildings at Long Dien town, Long Dien suburban district.

It is expected to be completed and put into use in late 2010.Source: Vnagency Source: TheSaiGonTimes7. Berjaya Corporation invests inVietnamese Fund Management Company

02 Jul, 20088.Hong Quang takes back the landat the project of The Adonis 2

03 Jul, 2008

A signing ceremony on the cooperation between Inter-PacificCapital Sdn Bhd Co., a member of Berjaya Corporation (Malaysia)and Thep Viet Capital Corporation was held on July 01, 2008 inHCM City. Inter- Pacific Co. will become a large shareholder ofThep Viet Fund Management Joint-Stock Company (which belongs

to Thep Viet Capital Corporation). Inter-Pacific Co. and ThepVietCapital will together participate in fund management & developmentof investment and business in Viet Nam.

02/07/2008, Hong Quang Real Estate Investment and ConstructionCompany announced the termination of contract on concession ofland use rights and simultaneously took back two land plots A5, A6of The Adonis 2 hing-end apartment building in District 7, Ho ChiMinh City.Hong Quang Company will repay Nguyen Do Limited Company 86billions VND for concession of using rights.

A4-REAL ESTATE DEVELOPMENTS NEWS

Source: VietRees Source: Thanh Nien9. Giant Marketing Center in Ha Noi to

come into operation in late 2009 30 Jun, 2008

10. Project of Tan Phu Thanh Trade &

Residential area developed 30 Jun, 2008

An Khanh, New Urban Development Joint-Venture Company (PoscoE&C cooperates Vinaconex) has organized the commencementceremony of Marketing Center at Bac An Khanh urban area, AnKhanh Commune, Duc Hoai Suburban District, Ha Tay Province.

The two storey center has a total area of 5,2 hectares. It comprisesa large hall, exhibition area, villas apartments for rent modelterraced house, guest houses for VIP guests, management office.

Thien Loc Can Tho Limited Company has just implemented itsinvestment in 42,5 hectare project of Vinaconex Trade ResidentialArea at Tan Phu Thanh Commune, Chau Thanh A suburbanDistrict, Hau Giang Province.

The project includes 1.319 townhouses, trade centers, schools,health care center... to serve accommodation for cadres, workers,officials and residents in an industrial park at Tan Phu Thanh.

NBVNBNN

Source: VietRees Source: VietRees11. Apartment area to be constructed forresettlement in Binh Thanh District

02 Jul, 2008

12. A Complex worth 200 million USD inHo Chi Minh City

04 Jul, 2008

HCMC Peoples Committee has decided to assign Construction

Joint-Stock Company No. 5 to use 34.370m2 land area at Ward 22,Binh Thanh District for construction of apartment area which belongsto urban renovation project at Thu Thiem bridge end.

The company will invest in the complete construction of 500apartments at Ward D and transfer them to the City to establish areserve of houses for resettlement of the city.

Aseana Real Estate and Binh Duong Joint-Venture Company are

licensed to invest in Horizon Place Complex project worth 200million USD on Nguyen Thai Hoc Street, District 4 by Ho Chi MinhCity Peoples Committee. Horizon Place Complex covers a totalarea of nearly 8.400m2 and includes 2 apartment blocks, 1 officeblock and 1 shopping area. The project is expected to commenceconstruction in the fourth quarter of 2008.


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This is a weekly newsletter issued by VietRees Vietnam Real Estate. This is shared with partners, clients, members (registered) and internal VietRees together with those who are concerning ornterested in Vietnam real estate market changes. Although the information is selected, synthesized from all reliable sources, this newsletter is only for reference and VietRees is not responsibleor the occurring damage. Please visit the website www.VietRees.com for further Vietnam Real Estate information. VietRees states clearly the original sources and dates for your convenientracking or getting full information. Should you need any queries or register to receive the newsletter, please contact via [email protected].

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A5-LEGAL NEWS

Source: KT&DT Source: Phap Luat13. New official document on investmentand development of houses for trade

02 Jul, 2008

14. The State must compensate for slowgranting of construction permit

03 Jul, 2008

Ministry of Construction has announced the official document No47/BXD-QLN providing guidelines on organization of investmentand development projects of houses for trade. As for projects onland area of under 20 hectares, investors must have a capital of notless than 15% of total project investment. As for projects on landarea of 20 hectares and upwards, investors must have a capital ofnot less than 20% of total project investment. Total investment doesnot include fees such as registering for land use rights, executingcompensation and site clearance, etc. Land-use rights auctions areonly applied to clean land pieces.

Additionally, regarding development projects of houses for tradewithout state-owned capital, Peoples Committee at authorized levelratifies the detailed plan at a scale of 1/500 and approvesinvestment mechanism, and investment decision is within investorscompetence.

Ministry of Construction created a positive way in field of investmentand construction of houses for trade. The situation in whichenterprises are allowed to act as project investor while their capitalis too low will not happen any longer.

On 2 July, 2008 Ministry of Construction offered draft decree onmanagement of construction and investment projects. According tothis draft decree, authorities in charge of granting constructionpermits must do this within 20 days since the date receiving fulllegitimate documents. As for separate houses, the duration forgranting construction permit must not exceed 15 working days.

Those who are authorized to grant construction permit mustcompensate for their slow actions. In the case that the granting ofconstruction permit is slow and permit requester starts construction,

the permit granter must compensate permit requester for damageswhen the construction is suspended and fined or does not suit theplanning and is obliged to be demolished.

Besides, authorities in charge of granting construction permits mustprovide information document relevant to granting of constructionpermit when requested by permit requesters within 7 days since thedate receiving the written request.


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SECTION B RESEARCH RESULTS & STATISTICS

B1. TOTAL FDI TILL JUNE 2008 B4. APARTMENTS AND DEVELOPMENT LANDS PRICES

B2. TOTAL FDI DURING THE FIRST 6 MONTHS OF YEAR

Foreign direct investment (FDI) keeps climbing. From the beginning of the year untilJune 20, 2008, there are 478 foreign investment projects granted construction permitswith total registered capital of $30.9 billion USD. Despite a 29.5% reduction in thenumber of projects, there is a 324.3% increase in capital on the same period of year2007.

f including $661.2 millions USD at the supplementary level of 158 licensed projects,otal foreign investment during the first 6 months of year 2008 has amounted to 31.6billion USD, 3.7 times higher than that of the same period of previous year, farexceeding $21.3 billion USD which is the total foreign investment of the whole year2007 in Vietnam. The average registered capital of one project is $64.7 million USD,ncreasing by $53.9 million USD per project over the same period of last year.

Among 478 newly licensed projects, industry and construction sector includes 298projects with registered capital of $17.2 billion USD, accounting for 62.3% of totalnumber of projects and 55.4% of total registered capital. Service sector includes 155

projects with registered capital of $13,6 billions USD, accounting for 32.4% of totalnumber of projects and 44% total registered capital. Agriculture, silviculture andaquiculture sector includes 25 projects with registered capital of 167.3 millions USD,accounting for 5.3% total number of projects and 0.6% total registered capital.Source: General Statistics Office of Vietnam - Edited by VietRees

B3. VN-INDEX

Source: Vietstock Up to date 04/07/2008

Updated on information from ACBR, Van Phat Hung, Hung Thinh, PhucDuc, Tuoi Tre Newspaper and developers (VietRees gathered by directsurveys), listed prices can be original prices or transfer prices at current orat one week prior from the date this newsletter is issued.

District Area (m2)Price (million

VND/m2)+/-

Apartment building HCMC

An Cu 2 140 20

Blooming Park 2 135 29

Van Do 4 100 27

Hung Vuong Plaza 5 121 27,5 -

Aview 7 110 16 -

Minh Thanh 7 88 18 -

My Khang 7 141 23

Conic Garden 8 72 15,5 +

The Mansion BC 83 16

Cantavil Hoan Cau BTH 128 46,5

Phu Nhuan PN 98 28 -

Phuc Yen TB 118 13

Development land lots HCMC

Detesco 2 252 30

The ky 21 2 160 21

Kim Sn 7 100 22

Ba T - Thanh Nhut 8 110 8

Gia Hoa 9 140 10,5 +

Nam Long 9 140 9,5

Hai Yen BC 100 12

KDC T30 BC 120 23

KDC Vinh Loc BTA 60 15

Hiep Phuoc NB 90 7,5

Apartment building - Ha Noi

M3 BD 120 26

Dich Vong CG 117 22

Trung Yen CG 90,5 21

Vimeco CG 96 26

Kim Lien DD 123 21

Thai Thinh DD 112 24,5

Linh Dam HM 62 16,5

Thuy Khue TH 137 26

Development land lots Province

My Phuoc 3 BD 300 2 -

Wind Hill BR-VT 160 4,5

Lan Truc Thanh CT 147,5 3,5

Hud DNI 285 2

Thanh Hung DNI 150 3,5

Tan Do LA 105 2,5

B5. ANNOUNCED PROMINENT REAL ESTATE DEVELOPMENTS DURING THE LAST 4 WEEKS

Week 2 June 2008 Week 3, June 2008 Week 4, June 2008 Week1, July 2008

HCMCity

Van Phuc Gia Company HA(H.Mon)

Binh Thien An AP Thu ThiemSoftware Park (D.2), Phu HuuWard HA (D.9), Truong ThoWard AP (T.Duc D.)

Tan Thuan Tay Residential Area(D.7), Long Truong Ward ResidentialArea (D.9)

Vietnam International University town(H.Mon), Resettlement Area W.22(B.Thanh), Horizon Place Complex(Dist.4)

OtherAreas

Novotel Hanoi on the ParkHotel Long Bien DistrictRuA (H.Noi), Laguna Hue

TA (TT-Hue), Mang DenEcological TA (Kon Tum)

P.4 Housing Service Area(V.Long)

The Long Chau Villas & Residences(H.Long) Vi Thanh CommuneResidential Area (H.Giang), Bao Son

Paradise (H.Tay), Golf Course Hotel Sea Links (P.Thiet)

Trang Cat Urban Area and IndustrialPark (H.Phong), Long Dien ApartmentArea (V.Tau), Marketing Center at Bac

An Khanh urban area (H.Tay), Tan PhuThanh Residential Area (H.Giang)


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B6. APPROVED PROMINENT REAL ESTATE DEVELOPMENTS IN HO CHI MINH CITYJune: Vinh Loc B RA (D. Binh Chanh), Van Phuc Gia Company HA (H.Mon), 38,4ha RA (D.2), Hung PhuCompany HA (D.9), Thu Thiem Software Park (D.2), An Phu Dong Ward De Tam Company HA (D.12), TruongTho Ward Tin Nghia Company AP (T.Duc D.), Office Building Conference Center 31 Le Duan (D.1), HoangPhuoc Company HA (D.12), P.13 584 Company AP (B.Thanh D.), Hoa Thanh Ward AP (T.Phu D.), CommercialBuilding 01W Dien Bien Phu (B.Thanh D.), AP For Reurban 147 Nguyen Chi Thanh AP and CommercialBuilding 258 Le Hong Phong (D.5), Hiep Binh Phuoc Ward AP (T.Duc D.), Tan Chanh Hiep Ward HA (D.12)

July: Complex W.11 (Minh Phu Co,Dist.3), Vietnam International UniversityTown (VIUT) (H.Mon), Suburb Area atThanh My Loi ward (Quang Trung Co,Dist.2), Horizon Place Complex (Dist.4)

RA: Residential Area, AP: Apartment Building, HA: Housing Area, RuA: Reurban Area, TA: Tourism Area, IA: Investment Area.

B7. REAL ESTATE MARKET FORECAST

The situation of real estate market For Sale during the last 6 months shows that prices are maintaining the current downturn. Many properties on consignmenthave not been asked to be purchased. According to VietRees, the reason is that the instability of market was exposed clearly and buyers insecurity becameworse when they got puzzled about the real value of real estate and kept expecting further price decreases. Prices of high-end apartment buildings have beenplummeted and prices of ground base in some areas have gone up too much higher than the real value.

The current time has been considered to be difficult for many real estate companies because the market has been selecting and promising a lot of newchanges. Real estate enterprises are getting in trouble because bank loans for house purchase have tightened. One of the steps taken by these enterprises iso cut down every cost and expand the progress, delay or stop implementing projects, and wait for a better market to deploy. In the market, there is a tendencyhat some enterprises have shifted towards investing in other fields to maintain their operation and overcome this current period.

According to VietRees, individual investors or those who are in real demand and have available capital but bank loans can re considered house buying at thisime. Real estate enterprises should reconsider and choose the projects of high feasibility and efficiency to implement. It is advisable to regard customers asthe core and guarantee their interests; investment porfolio should aim at customers who have real demands and avoid focusing on segments of secondarynvestors. Besides, it is neccessary for enterprises to raise capital from many different sources including joint venture with foreign partners. However, in reality,aising capital from joint venture with foreign parters currently also has difficulties because they are more punctilious about choosing, evaluating and

considering than before. Investors must be more professional when conducting any negotiation with these foreign partners.

* Note: Information on market forecast is only updated every 4 periods ( after one month) by VietRees

B8. CONSTRUCTION MATERIALS MARKET PRICES REPORT B9. CONSTRUCTION MATERIALS MARKET PRICES

01/07/2008, prices of all cement types products continues to decreasesignificantly. Currently, Holcim is priced at 69.000 - 72.0000 VND/bag,

Hoang Thach, Cam Pha... remains at approximately 65.000 VND/bag, butt is still unable to find customers. According to distributors, after pricencreases were licensed, cement companies speeded up their productionand created an abundant supply.

n the first 2 days of week, including carriage expenses, steel price hasncreased by 1.000 VND/kg and currently hits 19 million VND/ton. Steeldistributors explained that high steel price was due to high decrease inprices at manufacturing factories, carriage expenses and labor costs.Vietnam Steel Association said that, in June, the consumption ofconstruction steel only reached nearly 250.000 tons, decreasing byapproximately 60.000 tons over the previous month. The main reason washat low-cost construction steel imported from China with a large quantityrom early year until now has caused difficulties for domestic steel

consumption. In order to limit the paradox from the export of steel embyo

of domestic embryo manufacturing enterprises and the import of steelembyro of steel manufacturing companies, Ministry of Industry and Tradeand Ministry of Finance had a meeting to suggest solutions to theimitation of embryo export. And the possibility that export tax is re-adjusted or enterprises are granted permits to export embryo will beselected.

Edited by VietRees

Type of goods

(Source: HCMC Department of Finance)Unit

Price(VND)

Ha Tien Cement PCB40 50kg pack 74.000

Holcim Cement PCB40 50kg pack 73.000

Lavilla Cement PCB40 50kg pack 71.000

Fico Cement PCB40 50kg pack 71.000

Steel bloom D6 - Vinakyoei kg 18.900

Steel bars D10 - Vinakyoei kg 18.950

Steel bloom D6 South kg 18.150

Steel bars D10 South kg 18.000

Bao Loc brick ingots 190x80x80 Tuynel brick 1.200

Dong Nai wave roof tiles (grade A1) tile 3.550

Stone 1x2 m3 250.000

Stone 2x4 m3 230.000Sand m3 200.000

Sand (base for concrete) m3 230.000

Dong Nai decoration tiles (grade A1) tile 3.300

Thick, thin glazed tiles (grade A1) tile 1,000

Coric decoration tiles (30x30) m2 71.500


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This is a weekly newsletter issued by VietRees Vietnam Real Estate. This is shared with partners, clients, members (registered) and internal VietRees together with those who are concerning ornterested in Vietnam real estate market changes. Although the information is selected, synthesized from all reliable sources, this newsletter is only for reference and VietRees is not responsibleor the occurring damage. Please visit the website www.VietRees.com for further Vietnam Real Estate information. VietRees states clearly the original sources and dates for your convenientracking or getting full information Should you need any queries or register to receive the newsletter please contact via marketnews@VietRees com

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SECTION C: UTILITIES & SPECIALITY NEWS

C1. REAL ESTATE BROKERAGE TRAINING CENTERSC6. TRENDS IN INVESTMENT AND DEVELOPMENT OF REALESTATE PROJECTS

VietRees has updated a list of 40 agents granted training licenses andcertificates with regard to brokerage, pricing & management andoperating real estate trade floor. Most of these agents are located in HaNoi and Ho Chi Minh City and there is only 1 agent in Da Nang and 1agent in Can Tho.

C2. FEATURED ARCHITECTURAL DESIGN COMPANIES

SWA, M, www.swavietnam.com

Ong&Ong Co., Ltd., Singapore, www.ong-ong.com

Surbana Vietnam, Singapore, www.surbana.com

RSP Vietnam, Singapore, www.resp.com.sg

Archiects 61 Pte., Ltd., Singapore, www.a61.com.sg

DP Architects Pte., Ltd., Singapore, www.dpa.com.sg

C3. HOUSING NEEDS FOR FOREIGNERS

According to Statistics of Construction Ministry, at present, approximately 80,000foreigners are living and working in Vietnam, of whom 21,000 are fully capable ofbuying houses in Vietnam. In Hanoi, total housing area for foreigners to lease hasreached about 220,000 s.q.m, whereas in Ho Chi Minh City, this number hasripled.

Houses for lease are mainly villas, terraced houses and apartments with a leaseerm of 3-5 years. Ministry of Construction envisages that in the coming time thereare about 10,000 foreigners in need of buying houses with total square area of1.5 millions s.q.m.

C4. DEMAND OF WELFARE HOUSES FOR LOW INCOME EARNERS

AND RESETTLEMENT IN HCM CITYHCM City has developed the project of 30.000 welfare houses since the last 5years, yet currently only 30% is done. Regarding houses for cadres,workers,officials in the whole city, 17/49 projects serves over 3.600 apartments and over4.700 ground bases. Most of projects were executed more slowly than committeddate of investors by an average period of from 12 to 18 months.

According to Department of Construction, (1) HCM City includes 3 exportprocessing zones and 11 industrial zones in which housing areas need to be builtfor nearly 218.000 workers; (2) 30.000 houses for resettlement and (3) houses forapproximately 11.000 young officials and cadres.

C5. REAL ESTATE FOR THE LOW INCOME

Extra hundreds of thousands of apartments to be built for low-ncome earners

* Sai Gon Gia Dinh Real Estate Company and Hoa Binh Phu Yen Company

build Thoi An Apartment Building in District 12 with 1.000 apartments.* Construction Company No. 8 (CIC8) will invest in construction of 10.000 KeppelLand apartments and Tien Phuoc Company will build a resettlement areancluding 1.900 apartments at An Phu, Binh Khanh, District 2.

* HCM City housing development fund will build low- income houses in District 12.

* HCM City Peoples Committee will advance 50.5 billion to carry out the projectof Vinh Loc B, Binh Chanh residential area for resettlement with hundreds ofownhouses and 40 apartment blocks.

* Construction Company No. 5 will invest in construction of 500 apartments atWard 22, Binh Thanh District.

* Dat Lanh Company has granted construction permit for 30-40m2 apartmentspriced at 200-300 millions VND/unit.

* Besides, VinaCapital and Chinese, Korean Groups are expediting projects ofapartments worth below 400 millions USD/unit.

VietRees

According to VietRees analysis, in aspect of project developmentand investment, the current real estate market is witnessing somefollowing trends:

Current trends in investment and development of real estateprojects

1. Domestic enterprises with powerful financial potential, mainlycorporations, still keep developing, but their progress may beslower than before.

2. Most of enterprises are still expecting and trying to stay in thefield, but instead of doing it on their own as before, now theseagents have turned joint-ventures, called for cooperation,

investment and integration.

3. Some medium and small enterprises with unstable structuresand some individuals that own and tend to develop formerprojects are having difficulties in project implementation and havenot found out suitable partners. Now they are aiming at projecttransfer.

Before this situation, one reality is that many foreign investors arehunting for projects of domestic companies to undertake, transferor carry out joint-venture. According to study of VietRees, someadvantages that make foreign investors much interested in thisform include: clear legal situation of projects, avoidance of siteclearance compensation, furthermore, some projects only needinvestment to be implemented quickly. In addition, investmentcosts is sometimes a little lower than in reality because projectland of project management are taken back due to their slowerimplementation than in stipulation.

Recently, VietRees Investment Promotion Department has beenreceiving many requests from domestic investors who haveprojects in need of investment or transfer and requests of foreigninvestors about searching properties as well. As a supplier of fullservices, a deep market understanding and working experienceswith foreign partners, VietRees would like to offer advices toproject managers interested in calling for foreign investment intheir projects as follows:

Advice for project management interested in calling forforeign investment1. Fully prepare documents about project (especially for legaldocuments of projects).

2. Carefully study price of transfer or equity capital (forcooperation form or joint-venture form).

3. Regarding projects planned in details, a clear and logicalbudget distribution sheet for investment and detailed design ofevery portfolio in the overall project required.

4. Submit an analysis table of successfulness and feasibility level(profitability level) of projects.

5. For joint - venture forms, project managers should havecarefully and clearly prepared financial reports on enterprisessituations, and these reports should be carried out byprofessional audit companies.

6. Additionally, a small yet important factor is to learn aboutbusiness culture and national culture of foreign investors in orderto clear their very concerns and satisfy their requirements.VietRees

VietRees Newsletter 38 Week1 Month07 Year08

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