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Property M&A sees quiet Q3

Released at: 15:04, 10/10/2016

Property M&A sees quiet Q3

Photo: Viet Tuan

Just three major transactions in the third quarter but Vietnam still performing strongly in the region, according to JLL report.

by Doanh Doanh

The third quarter of 2016 was a quiet time for mergers and acquisitions (M&As) in Vietnam’s property sector, with only three major deals being made, according to the latest report from JLL.

The most notable transaction was the $51.9 million acquisition of a prime site in District 1, Ho Chi Minh City, by CapitaLand Vietnam. It now holds 100 per cent of the 0.5 ha site and will build apartments for sale and serviced residences. This is the first time a foreign developer has gained access to a site in District 1 and it will be interesting to see how the market reacts to the introduction of such a luxury boutique project in the area.

Mitsubishi Corporation, meanwhile, purchased a stake in a joint venture with the Bitexco Group to develop The Manor Central Park in Hanoi. In Hoang Mai district in the capital’s southwest, the project is an integrated part of The Manor Central Park township and includes residential, commercial, office, education, entertainment and sport facilities. In the first phase of their cooperation, Mitsubishi and Bitexco will develop 240 low-rise units and two high-rise buildings with a total of 1,036 apartments.

Another deal in the third quarter was VinaCapital acquiring the International Center Building in Hanoi from Keppel Land for $13.8 million. The International Center is just a short stroll from scenic Hoan Kiem Lake, the Hanoi Opera House, the Ministry of Trade and the State Bank of Vietnam. It offers over 7,000 sq m of Grade A office space and remains a preferred address of multinational corporations.

The M&A market could see huge demand coming from foreign investors, who are still eagerly looking for “clean and clear” development sites.

Despite the existing difficulties in finding good quality stock in the market, the sector is expected to be strong in the next quarter thanks to major growth momentum in Vietnam over recent quarters amid lower activity in the region.

M&A transactions, Q3 2016

Source: Real Capital Analytics

Date

Property

City

Type

Price ($ mn)

Buyer

Seller

Sep

Ho Chi Minh

Cau Kho Land Plot

HCMC

Development Site

51.9

CapitaLand Vietnam

River View Company Limited

Jul

The Manor
Central Park

Hanoi

Development Site

N/A

Mitsubishi

Bitexco Group

Jul

International Center Building

Hanoi

Office

13.8

VinaCapital

Keppel Land Ltd

JLL is a professional services and investment management firm offering specialized real estate services to clients seeking increased value by owning, occupying and investing in real estate. A Fortune 500 company with annual fee revenue of $5.2 billion and gross revenue of $6 billion, JLL has more than 280 corporate offices, operates in more than 80 countries, and has a global workforce of more than 60,000.

On behalf of its clients it provides management and real estate outsourcing services for a property portfolio of 4 billion square feet, or 372 million sq m, and completed $138 billion in sales, acquisitions and financial transactions in 2015.

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