The Vietnamese real estate market has remained attractive to foreign investors and investment funds despite difficulties countering domestic firms, according to insiders.
Illustrative image (Source: VNA)
Hanoi – The Vietnamese real estate market has remained attractive to foreign investors and investment funds despite difficulties countering domestic firms, according to insiders.
The 2023 Asia-Pacific Investor Intentions Survey released recently by CBRE Vietnam showed that Ho Chi Minh City and Hanoi are among top 10 most attractive destinations for trans-border investment. Particularly, for the first time, Ho Chi Minh City ranked third in the list, even above Australia.
Vietnam drew greatest attention from investors from Asian countries and territories, including Hong Kong, Singapore, China, the Republic of Korea and Japan.
With a forecast urbanisation rate of 42 per cent in 2025, Vietnam has high potential in real estate market development. With more people rising to the middle class, the country has become a magnet for real estate investment.
At the beginning of 2023, Singaporean firms conducted a number of large-scale deals in Vietnam.
Keppel Land, a real estate developer that is running more than 20 projects worth 3.5 billion USD in Vietnam, signed a memorandum of understanding with Khang Dien Group of Vietnam to cooperate in residential area building and sustainable urban development projects in Ho Chi Minh City in February.
Keppel Land CEO Louis Lim said that the firm is keen on strengthening its presence in Vietnam, one of its major markets with great long-term potential.
Meanwhile, Sembcorp Development has also reached a deal with Becamex IDC on partnership in developing five green, smart and sustainable industrial parks in Vietnam in the next three years with total investment of about 1 billion USD. These industrial parks will be built to meet green, smart and sustainable criteria, using high technologies in management.
The report “Vietnam Real Estate: Perspectives from China and Southeast Asian Countries” by PropertyGuru Group said Vietnam’s open economic policy and integration into global supply chains have made growth possible. Therefore, a resilient supply chain is key to Vietnam’s economic strength and increasing the attractiveness of real estate to foreign investors.
If Vietnam’s transport infrastructure of seaports, highways, high-speed railways and airports is expanded and completed, real estate in Vietnam will be a more attractive destination for foreign capital, both direct and indirect investment, the report said.
According to the Foreign Investment Department under the Ministry of Industry and Trade, the real estate sector drew the second largest amount of foreign direct investment among all sectors in 2022, attracting more than 4.45 billion USD, accounting for 16.1 per cent of the country’s total.