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Hongkong Land on board in Thu Thiem New Urban Area

Released at: 08:31, 17/03/2017

Hongkong Land on board in Thu Thiem New Urban Area

Photo: HCMC/Design/Illustration

Ho Chi Minh City Infrastructure Investment JSC takes on Hongkong Land as strategic partner.

by Ngoc Chi

Hongkong Land has become a strategic partner of the Ho Chi Minh City Infrastructure Investment JSC (CII) in a residential area and North - South axis project at the Thu Thiem New Urban Area in District 2, Ho Chi Minh City.

The project has total investment of over VND2.6 trillion ($114.4 million) and covers an area of 96,000 sq m. It includes a road from Thu Thiem Bridge to Mai Chi Tho Avenue, water, lighting, and a green space.

Though not disclosing the details of the deal, CII said that the choice was made carefully, based on the land price and cost of construction.

“The cooperation with Hongkong Land will not only spur the business results of CII during the 2018-2020 period but also create a firm basis for it to maintain annual growth of 20-25 per cent in subsequent years,” a CII representative said.

Hongkong Land recorded profit of $3.52 billion in 2016, with $2.55 billion coming from real estate. It was one of the first foreign investors to set foot in Vietnam, in the mid-1990s.

A member of the Jardine Matheson Group, Hongkong Land has made capital contributions of more than 50 per cent in three projects and domestic enterprises in Vietnam, including the Central Building Co., the Doan Ket Quoc Te Co., and the Nassim JV Co. (the owner of the high-end Nassim Thao Dien apartment block). The total capital contribution is estimated at $22.3 million.

The partnership with Hongkong Land will help CII boost its real estate business, which now accounts for only 2 per cent of its revenue structure.

According to its 2016 financial report, revenue reached over VND1.2 trillion ($52.8 million), down sharply compared to VND1.77 trillion ($74.8 million) in 2015. This year it targets revenue of VND5.7 trillion ($250.8 million). 

The Thu Thiem New Urban Area is located to the east of the Saigon River, opposite District 1, on a total area of 657 ha. It is to be a new modern central district, enlarging the existing center of Ho Chi Minh City. The city’s People’s Committee continues to call for other investors to develop projects in the urban area.

It has already attracted a huge amount of interest from international investors, who are ready to pour in billions of dollars into building new skyscrapers.

A massive project for a modern trade center with multiple functions worth $4 billion was proposed by three US investors at a meeting with Ho Chi Minh City Party Secretary Dinh La Thang last year.

Another foreign enterprise keen to benefit is the Imex Pan Pacific Group (IPP), owned by overseas Vietnamese Johnathan Hanh Nguyen.

Approved in 2014, the 86-storey Thu Thiem Empire City Tower is now being implemented by the Tien Phuoc - Keppel Land joint venture from Singapore. The highest building in Ho Chi Minh City will cover 8.7 ha.

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