Big corporations shaking hands to revive real estate market

Big corporations shaking hands to revive real estate market
A lot of cooperation agreements in the real estate sector have been inked recently promising big success in real estate project development.

Real estate developers are now tending to join forces with other investors to develop projects rather than going it alone.

On June 11, Hoang Anh Gia Lai Housing Construction and Development Corporation signed a strategic partnership agreement with An Binh Land Real Estate Investment Company. Under the agreement, An Binh will become the sole distributor of the 100 apartments at block A of Hoang Anh River View tower in Thao Dien ward in district 2 of HCM City.

This is the bloc in the most advantageous position of the project as apartments have views of the Saigon River. The apartments here are 138-177 sq m each, and have the sale price of 25.2 million dong per square metre.

General Director of Hoang Anh Gia Lai Le Hung said that Hoang Anh Gia Lai decided to choose An Binh Land to distribute the apartments because An Binh has advantages in real estate marketing in HCM City and neighbouring countries. Moreover, An Binh Land is backed by An Binh Bank.

People who purchase Hoang Anh River View apartments have to pay a deposit of 100 million dong, and then make payments in 10 installments (5-10 percent of apartments’ values for each payment). In the final payment before getting apartments, clients pay the remaining 25 percent of apartments’ values.

Moreover, purchasers of the apartments can borrow money from ABBank at preferential interest rates (70 percent of market interest rates) for 20 years. Borrowers have to pay 11.6-12 percent per annum in interest.

Prior to that Hoang Anh Gia Lai Land chose Sacomreal, backed by Sacombank, to distribute the apartments of B-bloc of the same real estate project.

Another ‘marriage’ also reportedly took place on June 9 between Saigon Investment Corporation (SGI) and the US-based Starwood. The two sides joined forces to develop a project on building two resorts, Le Meridien Danang Resort & Spa and Sheraton Dalat Resort & Spa.

Under the agreement inked between the two signs, SGI is the investor, while Starwood is the manager of the two resorts. SGI has the right to use the two leading brand names, Le Meridien and Sheraton, for its projects. The cooperation promises to bring to the real estate market two splendid 5-star projects with the total investment capital of $140 million.

It is expected that SGI will kick off the two projects in early 2010 and put them into operation in 2013, while the investor hopes to get back capital within seven years.

On June 4, Thu Duc Housing Development Company and South Korea’s Daewon Group inked a cooperation agreement on investment in a 20-storey building in Hiep Phu ward in district 9 of HCM City, capitalised at 500 billion dong.

The two big names previously joined forces to implement the Cantavil An Phu apartment project.

In mid April, ITC, a member of Becamex group, also found a strategic partner to help develop and distribute its Hoang Gia service-tourism urban area project.

In the cooperation affair, ITC contributes 70 percent of the total investment capital of the project, while Dat Xanh Real Estate and Construction Service Company the other 30 percent. The project is estimated to have the total investment capital of 1,300 billion dong.

A lot of alliances and partnerships like these have been set up since the beginning of the second quarter in the HCM City real estate market.

Analysts say that the professionalisation of investment, construction, distribution and management has become the choice of many enterprises. It is simply because in Vietnam, there is no giant who can do all things well.

More and more bilateral and multilateral partnerships in real estate investment will be seen in the market as enterprises are striving to survive the current crisis and obtain sustainable development, they say.

Source: VnMedia