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Reputation key at property projects

Released at: 07:15, 12/08/2018

Reputation key at property projects

Photos: Viet Tuan

Developers are acutely aware of the need to have a reputable name managing their projects.

by Ngoc Lan

In addition to building quality housing and office projects, developers are also increasingly focused on management and operations to enhance value. Ms. Tran Thi Thanh Hoa, former Head of Management at an apartment project in Hanoi’s Nam Tu Liem district, said that real estate management is an exciting job that requires a mastering of processes, soft skills to deal with situations as they arise, and an understanding of every detail of the project. “We not only managed the real estate project but also had to provide customers with the best services possible,” she added. “We managed infrastructure systems such as elevators, electricity and water supply, and utilities such as security, sanitation, and greenery to ensure a convenient and comfortable life for residents.” 

The latest report from Savills points out that for real estate projects in the design stage, the use of real estate management consultancies minimizes the instance of design revisions, providing developers with an accurate overview of operating costs. Projects being introduced to the market, meanwhile, often choose a professional management unit to create trust and gain the attention of customers.

Key criteria

Savills manages more than 65 projects in office buildings, condominiums, and urban areas, with 40 in Ho Chi Minh City and 25 in Hanoi and the north. 

Ms. Vu Kieu Hanh, Head of Property Management at Savills Hanoi, said developers seek professional management companies to provide good services to customers, apply standardized procedures in daily operations, maintain inspections, and periodically perform maintenance to protect the image of the investor and ensure the project’s sustainability. “They also ask management companies to guarantee that building management staff meet certain skills criteria and have experience,” she said. 

Among Vietnam’s large real estate management companies, Savista has managed over 30 projects in segments such as condominiums, office space, urban areas, and commercial centers. In its ten years in Vietnam it has researched and evaluated the needs of developers in selecting a management company. “The beginning period, when the project is first put into operation, often sees problems that require managers be objective with both sides to help developers explain and meet the needs of customers,” said Mr. Nguyen Tien Dung, General Director of Savista. “In recent times, in addition to the brand factor to create value for projects, developers have bene looking for managers that can share the burden and responsibility.”

After 13 years of establishment and development, Homecare now manages ten hotel, office and high-end condominium projects. Unlike Mr. Dung, however, CEO Mr. Nguyen Thanh Hung believes developers will select a reputable manager in the initial stages of the project and accept the high cost of doing so. “An experienced manager is then selected at a competitive price in the next stage,” he said.

Foreign managers

Though the criteria are the same for all real estate management companies, some developers simply prefer an international name. The Sun Group has been cooperating with leading international companies in the field of management and operation of hotels, resorts, high-end apartments, and commercial centers, such as AccorHotels, the InterContinental Hotels Group (IHG), JW Marriott International, CBRE, Savills, and JLL. “We have selected international names because their prestige and experience are recognized internationally,” Deputy Chairman and General Director Mr. Dang Minh Truong, told VET. “Professional cooperation increases our brand value and that of our hotels, resorts and other projects.” 

For example, CBRE currently has approximately 80,000 employees in more than 100 countries worldwide, while Savills has grown to employ over 30,000 people across 700 offices around the globe. JLL, meanwhile, is a Fortune 500 company with nearly 300 corporate offices and operations in over 80 countries and a global workforce of 83,500. 

Many industry analysts say this also affects the psychology of foreign and Vietnamese customers in terms of credibility and peace of mind. Domestic real estate managers, meanwhile, largely have insufficient experience and lack a solid reputation.

Foreign companies also have their global standing to protect. “They constantly focus on training employees to comply with the standards of the profession and respecting the legal requirements of the local government on the management of building operations, and not simply operate for a profit,” Ms. Hanh added. 

Mr. Truong said that foreign managers strictly following regulations forces Vietnamese staff to improve, which is good for building up the human resources available in the industry. “High standards, legal transparency, quality in design and construction, and prestige pressures us to improve ourselves and also helps projects,” he believes. 

Local opportunities

The presence of foreign real estate management companies in Vietnam has made the market more competitive. Many domestic companies, however, have already caught up with management trends and narrowed the gap with their foreign counterparts. “Foreign companies mainly manage certain segments, such as high-end buildings owned by foreign developers,” said Mr. Dung. “Segments such as Grade B are the playground of Vietnamese management companies, as it’s difficult for foreign companies to manage the segment at a feasible cost.”
According to the provisions of Circular No. 02/2016/TT-BXD from the Ministry of Construction (MoC), units that manage and operate condominiums must have specialized sections in technical operations, security, reception, sanitation, and the environment. All departmental personnel must also have a relevant professional qualification and complete an in-depth training course on managing apartment buildings, in accordance with regulations from the MoC. Government regulations will also make it easier for investors to settle on basic standards when working with local management companies.

The issue of fire prevention in apartment buildings has increased the importance of proper management and customers are also more cautious when purchasing apartments. This represents an opportunity for management companies to improve their service quality and meet needs. “Vietnamese management companies must build a reputation, employ good quality staff, and be committed to competing with foreign companies,” Mr. Hung said.

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