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Japanese investors keen on real estate

Released at: 08:11, 22/07/2017

Japanese investors keen on real estate

Photo: Viet Tuan (VET)

Investment wave continues as Japanese investors see real potential in Vietnam's real estate market.

by Quynh Nguyen

By cooperating with local businesses, the investment wave from Japanese enterprises into Vietnam’s real estate market continues to grow strongly.

According to the Foreign Investment Agency at the Ministry of Industry and Trade, as at the end of 2016, Japanese investors had registered to invest in 53 projects with total capital of $1.91 billion; the most of any country.

Shaking hands

Japanese investors conducted many merger and acquisition (M&A) deals in Vietnam during the first half of this year, according to JLL. 

They were initially involved in investing in office blocks and hotels but are now stepping into the residential sector. Different from other investors, however, Japanese enterprises do not invest in projects. They choose instead to invest indirectly, purchasing shares from companies or joining a project that has already completed formalities with government agencies.

The Nam Long Investment Co., has boosted its cooperation with Japanese enterprises. It recently reached agreement with two Japanese investors - Hankyu Realty from Osaka and Nishi Nippon Railroad from Fukuoka - to launch the Mizuki Park project in District 7, Ho Chi Minh City with investment capital of VND8 trillion ($352 million).  

Other cooperative arrangements between Japanese and Vietnamese enterprises have also been seen, such as Daiwa House, Nomura, and Sumitomo cooperating with Phu My Hung and Sanyo Home with the Tien Phat Company to implement the Ascent Lakeside project in District 7. Kajima has worked with Indochina Capital, Mitsubishi with the Bitexco Group, and Tokyu with Becamex, while the Creed Group has poured investment capital into the Nam Bay Investment Corporation and An Gia, and the Lemon Grass Master Fund has poured capital into Sonkim Land Corporation.

Japan’s Maeda Group and Vietnam’s Thien Duc Company recently invested $30 million via their joint venture, Maeda Thien Duc, in the Waterina Suites high-end apartment project in District 2, Ho Chi Minh City.

Upwards trend

Japan is known for its high standards so Japanese-based projects often focus on quality and convenience and their presence is a factor in the prestige and attractiveness of projects.

CEO of Maeda Thien Duc, Mr. Tetsuo Kida, said that Vietnam has many similarities with Japan and Thailand’s real estate market. With 25 years of experience in management in Myanmar, India, Thailand, and Cambodia, Mr. Kida believes that Thailand will also take time to change, like Vietnam. Vietnam is therefore expected to develop in the time to come.

According to CBRE Vietnam, the high-end segment has attracted interest from foreign investors in Singapore such as CaptitaLand, Kusto, and Keppel Land, and Japanese investors are expected to boost their investment in Vietnam in the near future.

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