Vietnam’s debt-collecting agency seizes skyscraper to cover $308 million loan

Prime Minister Nguyen Xuan Phuc has said it is necessary to create a special legal framework to attract investment in special zones. A draft law will allow foreigners to own houses for up to 99 years and allow mortgaging of assets associated with land-use rights at foreign credit institutions, which is in line with the 2013 Constitution. Nguyen Manh Ha, chair of the Vietnam Real Estate Brokerage Association, that the ownership time limit of 99 years is not a new regulation.  Under Decree 99/2015, foreigners can own houses for 50 years and have the right to an extension of no more than 50 years.  The difference between the current regulation and the new law to be enacted is that foreigners will not have to ask for an extension to own houses for 99 years. Ha said this shows the government of Vietnam’s strong determination to pave the way for attracting investments into economic zones.  The policy would create best conditions for expats in Vietnam to access houses more easily. However, very few banks are willing to help foreigners follow necessary procedures to buy properties in Vietnam.  Thus, there is a need for closer coordination between government agencies and credit institutions as well as project developers in attracting home buyers in Vietnam. The Republic of Korea once restricted foreigners’ house purchases, but after the financial crisis, it allowed foreigners to buy houses.  Indonesia allows foreigners to own property in the…... [read more]

View of seized Sai Gon M&C high-rise building project. — Photo sbv.gov.vn Viet Nam Asset Management Company (VAMC) on Monday conducted its first confiscation of an asset mortgaged for a non-performing loan based on a newly-issued resolution. The mortgaged asset is the Sai Gon M&C high-rise building project at 34 Ton Duc Thang, District 1, HCM City. It belonged to the Sai Gon One Tower Joint Stock Company. According to a statement released on the State Bank of Viet Nam’s website, the confiscation was aimed to settle and recover the debt in accordance with the legal regulations stated in Resolution No 42/2017/QH14, which has just taken into effect since August 15 this year and is designed to quickly and definitely settle bad debts and mortgaged assets for bad debts. Earlier, VAMC signed a debt purchase agreement with several credit institutions for debts of a group of customers, including Sai Gon One Tower Joint Stock Company (formerly Saigon M&C Real Estate Joint Stock Company), Lien Phat Investment Joint Stock Company, Minh Quan Investment and Construction Joint Stock Company, New Superdeck M&C Joint Stock Company. The total outstanding debt, including principal and interest, is more than VND7 trillion (US$307 million). VAMC repeatedly required the group of customers to fulfil their debt repayment obligations; however, the customers did not pay the debt nor had a feasible repayment plan. VAMC then asked Sai Gon One Tower Joint Stock Company to hand over the mortgaged asset…... [read more]

To capitalise on the increasing interest of foreign real estate investors in Southeast Asia in general and Vietnam in particular, CapitaLand Limited has set up its first commercial fund in Vietnam named CapitaLand Vietnam Commercial Fund I (CVCFI) with a capital of $300 million. CapitaLand launched its $300-million commercial fund to ride the waves of mounting investment demand The fund, which will have a life span of eight years, will be used to invest in Grade A commercial real estate in Vietnam. CapitaLand will hold a 40 per cent stake in CVCFI, while the remaining interest will be held by major institutional investors, the company announced on its website. Lim Ming Yan, president cum CEO of CapitaLand Limited, said, “We see increasing investor interest in Southeast Asia, particularly in Vietnam. CapitaLand is positive about the growth trajectory of Vietnam and foresees that this trend will continue for at least the next ten years. Besides the growing demand for residential properties with urbanisation, we also see strong potential upside in the commercial real estate sector, given the mismatch between the supply and demand of quality office space.” “CVCFI brings us a step closer to our goal of raising funds with $7.34 billion in total assets under management by 2020. It comes on the back of our largest private equity partnership, the $1.5-billion Raffles City China Investment Partners III, which invests in prime integrated developments in gateway cities…... [read more]

One out of every three foreign travelers to Vietnam visits Ha Long Bay, but most of them travel from Hanoi and spend one night on boats before returning to Hanoi. There are not many well-known hotel brands in Ha Long, except Novotel and Wyndham. However, an analyst said that Quang Ninh is more attractive in travelers’ eyes than Da Nang, but is inferior in terms of tourism real estate. Quang Ninh last year received 8.3 million travelers, including 3.5 million foreign travelers. Da Nang attracted 5.5 million travelers, while the number of foreign travelers was less than half of that of Quang Ninh. However, Quang Ninh only has 5,651 high-end 3-5-star hotel rooms, just half of the number in Da Nang.  Most high-end hotels in Quang Ninh are located in Ha Long City, including four 5-star hotels with 1,260 rooms in Bai Chay. The number of 4-star hotel rooms is 2,772 rooms, while there are 1,179 3-star hotel rooms. While there are tens of condotel projects in Da Nang which provide 15,000-17,000 accommodations, there is only one project of this kind – Citadines with 637 apartments, in Quang Ninh. Meanwhile, New Life and Green Bay are apartments for sale and are available for lease, but don’t operate as hotels. Da Nang is also superior in terms of high-end villas.  Da Nang has Furama Villas, Premier Village, Hyatt, Vinpearl and Ocean Villas, while Quang Ninh has Royal Lotus. Quang Ninh…... [read more]

Workers at the HCM City Tax Department instruct tax payers during registration. — VNA/VNS Photo Hoang Hai In a recently released conclusion to a meeting on tax law adjustments, Deputy Prime Minister Vuong Dinh Hue asked that the Ministry of Finance’s (MoF) controversial new amendment drafts to tax laws be adjusted to meet both the national growth plan and the current economic climate. The MoF sought to make changes to the laws on Value Added Tax (VAT), Special Consumption Tax (SCT), Corporate Income Tax (CIT), Personal Income Tax (PIT) and Natural Resources Protection Tax (NRPT). Regarding the recent drafts, the Deputy PM said that revisions and amendments based on public and experts’ opinions, in compliance with other newly issued regulations from the National Assembly (NA), such as the law on Support for Small and Medium Sized Enterprises (SMEs), or the Law on Investment, were needed. Hue requested the MoF re-examine the VAT law amendments. He asked that some regulations be readjusted, such as agricultural products being exempt from tax registration, goods and services being subject to a 12 per cent VAT level from the previous 10 per cent, or some other groups of goods and services being denied preferential VAT. On the SCT amendments, the Deputy PM said that the MoF must consult the Ministry of Industry and Trade (MoIT) before deciding whether or not SCT should be applied to passenger cars with nine seats or fewer. Moving onto the CIT…... [read more]

In a recently released conclusion to a meeting on tax law adjustments, Deputy Prime Minister Vương Đình Huệ asked that the Ministry of Finance’s (MoF) controversial new amendment drafts to tax laws be adjusted to meet both the national growth plan and the current economic climate. Workers at the HCM City Tax Department instruct tax payers during registration. - VNA/VNS Photo Hoàng Hải The MoF sought to make changes to the laws on Value Added Tax (VAT), Special Consumption Tax (SCT), Corporate Income Tax (CIT), Personal Income Tax (PIT) and Natural Resources Protection Tax (NRPT). Regarding the recent drafts, the Deputy PM said that revisions and amendments based on public and experts’ opinions, in compliance with other newly issued regulations from the National Assembly (NA), such as the law on Support for Small and Medium Sized Enterprises (SMEs), or the Law on Investment, were needed. Huệ requested the MoF re-examine the VAT law amendments. He asked that some regulations be readjusted, such as agricultural products being exempt from tax registration, goods and services being subject to a 12 per cent VAT level from the previous 10 per cent, or some other groups of goods and services being denied preferential VAT. On the SCT amendments, the Deputy PM said that the MoF must consult the Ministry of Industry and Trade (MoIT) before deciding whether or not SCT should be applied to passenger cars with nine…... [read more]

He was speaking while operating the second working day of the 11 session of the 10th city Party Committee. About business development, he said that HCMC has set the target of having 500,000 businesses by 2020. At present the city has over 300,000 enterprises but they are mainly small and medium scaled. The number of companies in the city’s key economic industries is very low. Of 25,000 businesses registered since early this year, over 30 percent are from real estate field. So he asked which policies are necessary to encourage businesses to invest in key economic industries such as industry, hi-tech, commerce and finance. Talking about traffic development, Mr. Phong said that from now until 2020 which projects the city should implement, where capital source will be, how much will be mobilized from the state budget and how much from the society. Investment in traffic development should base on regional overall plans. It should be clearly defined that which projects will be built from the central budget, which from local budget and which are the best coordination methods for provinces and cities in a region. They should intensify connectivity, diversify investment methods and focus on mobilizing all possible resources to solve problems in urban traffic system development, he affirmed. Director of the Department of Transport Bui Xuan Cuong said that land for traffic development now accounts for 18.5 percent of total urban land area. By 2020, the city needs up to VND550 trillion (US$24.2 billion) for traffic development.…... [read more]

Earlier, numerous giants in the retail sector have entered the Vietnamese market and now, many of them are planning to enhance investment and expand their businesses to exploit market potential. HCM City’s annual retail promotion month gets bigger Vietnamese retail sector to flourish in AEC era Korean convenience store chain GS25 sets foot in Vietnam AEON MALL Binh Duong Canary Enhancing investment in Vietnam Recently, when talking with VIR, Yasuo Nishitohge, general director of AEON Vietnam Co., Ltd., said that Vietnam has great potential in the retail sector, so expanding business in the country is necessary. In early 2017, AEON Group signed an agreement to cooperate with Vietnamese BIM Group, a diversified group of companies concentrating on three main business sectors, including tourism development and real estate investment, food-agriculture, and commercial services, to develop an AEON Mall in Hadong district, Hanoi. Meanwhile, in Ho Chi Minh City, this Japanese retailer is promoting the construction of its third shopping mall. “We are behind schedule of opening 20 shopping malls by 2025, but up till now, there have been four only due to the lack of appropriate sites,” Nishitohge said. He added that AEON will speed up their investment plan in the coming period. In particular, the group schedules to open two new shopping malls every year. In the short-term, this giant…... [read more]

Reuters quoted Koji Takayanag, president of FamilyMart UNY, which now owns the second largest convenience store chain in Japan, as saying the company has decided to cut its losses and move on to more promising markets. In November 2016, Parkson closed its last department store in the Vietnam capital city of Hanoi following eight successive years of red ink. The 11,000-square metre department store located in Viet Tower in the city central business district once held the promise of becoming a beacon of the city’s new-found prosperity and the busiest shopping plaza in Hanoi. However, after eight years, the company had little to show for its investment and opted for the exit ramp. Another Hanoi Parkson in the Keangnam area was closed due to a purported dispute between the retailer and the building owner. All retailers had to move out of the building overnight. Former Parkson CEO Toh Peng Koon once said Vietnam was the toughest market for the company and poor sales was the main reason for that closure. In Ho Chi Minh City, the Parkson Paragon was closed in May 2016, just five years into a 19-year lease. But those closings did little to stop the bleeding, as Parkson Retail Asia’s third-quarter net loss for the three months ended March 31, 2017 deepened 24.4% to US$6.4 million. Same-store sales declined across Indonesia, Malaysia, Myanmar and Vietnam for the third quarter and were particularly damaged by an ever-increasing crowded…... [read more]

VietNamNet Bridge - With value of $118 billion in 2016 and $180 billion projected for 2020, Vietnam is listed among the world’s 30 most attractive retail markets.  Many investors are entering the retail market, including Son Kim, an underwear manufacturer, to open convenience store chains, competing against big chains like 7-Eleven, Vinmart and Circle K. Yonhap has reported that South Korean GS Retail has signed a contract with Vietnamese Son Kim Group to set up a joint venture to develop the GS25 chain in Vietnam, expected to include 2,500 shops in the next 10 years. The first shop will open this year in HCM City. The press release of the South Korean retail giant said it received invitations from many countries, including China and South East Asia, for franchise contracts. However, it came to a conclusion that Vietnam has the greatest potential. Business Korea quoted a source from GS Retail as saying that GS Retail chose Vietnam for its first GS25 shop overseas because the economy is developing rapidly and 57 percent of population are aged 35 and below. A.T. Kearney has put Vietnam in the sixth position in the world in terms of the retail market development index, a five notch upgrade compared with last year’s ranking.  GS Retail chose Vietnam for its first GS25 shop overseas because the economy is developing rapidly and 57 percent of population are aged 35 and below. The US consultancy firm’s report also pointed out that convenience stores and mini supermarkets are two…... [read more]




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