Sunday, 26 May 2019

Vietnam's real estate M&A hits US$200m in the first quarter

Updated at Thursday, 12 Apr 2018, 10:33
The Hanoitimes - Vietnam`s real estate sector saw mergers and acquisitions (M&A) reach a total of US$200 million in the first quarter this year, according to estimates by real estate and investment management firm Jones Lang LaSalle (JLL).
Some of the prominent deals in the first quarter were CapitaLand acquiring a plot of land in the West Lake District of Hanoi for US$30.2 million, Nomura Real Estate purchasing 24% of Sun Wah Tower and Thailand's Strategic Hospitality REIT buying two projects in Ho Chi Minh city. 
Vietnam's real estate M&A hits US$200m in the first quarter.
Vietnam's real estate M&A hits US$200m in the first quarter.
JLL expected 2018 to be a record year for the real estate M&A activities in Vietnam. 

A recent regulation by State Bank of Vietnam (SBV) asking credit institutions to limit their lending to the real estate and construction sectors to better control bad debts and maintain credit growth. This has made real estate investors seek other capital sources. 

In a report by DealStreetAsia, foreign investors see Vietnam as a destination for their long-term investment, at least five years. Instead of existing projects, they are more interested in real estate to be formed in the future.  

Last year, Vietnam's real estate sector saw M&A touch a total of US$1.5 billion. Some of the prominent deals last year were a joint venture between Hongkong Land (HKL) and Ho Chi Minh Infrastructure Investment JSC (CII), a US$40-million acquisition of 1.45-hectare site District 4 by CapitaLand, and VinaLand divesting its entire stake in the Vina Square Project for about US$41.2 million. 

There is also greater interest among private equity funds to tap the market. The year 2017 saw the establishment of a joint venture between Warburg Pincus and Becamex IDC Corporation to develop international standard logistics warehouses in the country. 

"The legal system continues to improve which provides more confidence to investors looking to gain a foothold in this exciting market. As Vietnam is an emerging market, there are a number of opportunities that can offer investors high returns not seen in other more mature markets," Stephen Wyatt, JLL's Country Head for Vietnam, had told DealStreetAsia earlier.
Ngoc Thuy
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