CapitaLand has been present in the Vietnamese market since 1994, starting with serviced apartments and commercial projects. Before venturing into residential development in 2007 with the launch of The Vista in Ho Chi Minh City. Until now, CLD has developed an investment portfolio in Vietnam with a commercial area, a SOHO project, two mixed-use projects, and about 16,000 apartments in 17 residential projects in Hanoi, Ho Chi Minh City, and neighboring provinces like Binh Duong.
At the beginning of the year, this company caught attention with a series of large-scale real estate projects in both the Northern and Southern markets. Specifically, the groundbreaking ceremony for the Sycamore project in Binh Duong province took place at the end of February 2024, and recently, the groundbreaking ceremony for the Lumi Hanoi project. These are the two latest projects of CLD in the Vietnamese market, with approximately 7,500 apartments and a total project development value estimated at over $2 billion Singapore dollars (equivalent to VND 36 trillion).
Therefore, the target of developing 27,000 apartments in 5 years set by CLD is more than 70% higher than the company’s current residential portfolio in Vietnam, with over 16,000 apartments, including more than 7,500 units in the Sycamore and Lumi Hanoi projects. Many people are questioning whether this ambition can become a reality when this “giant” has been present in the Vietnamese market for 30 years, yet it has only developed a modest number of 16,000 apartments.
Jonathan Yap, CEO of CLD confidently admitted that the goal of adding 11,000 apartments by 2028 is an ambitious target. However, in addition to the residential sector, CLD also sees other potential areas in the Vietnamese market that the company can capitalize on in real estate. These are sectors where Vietnam is experiencing impressive growth such as commerce, industry, and logistics.
“To achieve the target of developing an additional 11,000 apartments in the next 5 years, we will accelerate our capital deployment and expand our development roadmap through strategic partnerships with reputable partners both domestically and internationally. We will focus on large projects with convenient locations in key markets like Hanoi, Ho Chi Minh City, and neighboring areas like Binh Duong by leveraging CLD’s unique comprehensive expertise in the real estate value chain, as well as the competitive advantages in overall planning and development,” he said.
Furthermore, the Singaporean real estate “giant” is confident that Vietnam’s GDP in 2023 will achieve an impressive growth rate of 5.05%, the fastest growth rate in Southeast Asia. With a population of over 100 million people and an increasing middle-income segment, the demand for housing in the Vietnamese market is promising to be positively stimulated.
As evidence for his statement, CapitaLand representatives said that the group’s recent projects have regularly achieved impressive absorption rates. For example, Define – a high-end apartment project located in Thu Duc City, Ho Chi Minh City, achieved a 100% booking rate just two hours after its launch. The minimum price for each unit is $1 million US dollars (equivalent to VND 24 billion). Similarly, Heritage West Lake, located in Tay Ho district, Hanoi, is also one of the group’s successful projects with all 173 apartments and 202 SOHO units (a combined product of office space and living area) sold at prices higher than the market average by about 30%.
