Hanoi Lures More Foreign Property Developers

Foreign property developers from Korea, Japan and Singapore are hoping to invest big bucks in hotel construction in Hanoi, as the city’s real estate market is coming alive.

 

The South Korean-invested Charmvit Group already has license to develop a 564 room five-star hotel on 1.98 hectares of land at the Dong Nam residential area in Cau Giay district. Work on the project, valued at USUS$80 million, is scheduled to begin this July and last until the fourth quarter 2009.

 

The South Korean investor has paid a guarantee for the project, carried out geological surveys, and is designing architecture, to apply for the investment certificate. The preliminary design of the hotel has been submitted to the Hanoi Department of Planning and Architecture.

 

The hotel is located near the National Convention Center, facing the Big C supermarket and adjacent to new residential areas. The investor has asked the Hanoi government for permission to build the hotel to 30 floors, not 18 as originally planned.

 

At an earlier stage in the process, South Korea’s Keangnam group is competing with Kanagawa Association/Riviera group of Japan for license to build another five star hotel on a 4-6ha of land on Pham Hung street.

 

Keangnam commits to invest US$500 million to build a 500-room hotel and to complete the project by January 2010. To demonstrate its commitment to the project, Keangnam pledged to provide Hanoi with non-refundable aid of US$5 million and pay a project guarantee equivalent to 10 per cent of total investment.

 

Its Japanese rival, Riviera, meanwhile, commits to invest US$500 million to build a 550-room hotel and provide Hanoi with US$3 million. In addition, it pledged to complete the project in late 2009.

 

It appears Riviera will win the race, as the Hanoi People’s Committee recently announced that Riviera is the ‘priority partner’. So as not to disappoint the Koreans, Hanoi’s government will likely grant them several construction projects in Cau Giay Urban Zone.

 

Like Charmvit, Singapore-based Antara Koh Development already has its license in hand. It is teaming up with Hanoi Housing Investment and Development Company to build a USUS$240-million complex of houses, offices, hotels, and public works for lease.

 

Antara Koh Development Pte. Ltd has completed administrative formalities and is waiting for approval of its design.

 

Trieu Dinh Phuc, Director of the Hanoi Planning and Investment Department, said many foreign investors are interested in infrastructure projects for hi-tech parks, finance-banking centers, new urban areas, hotels, office buildings, apartments, trading centers, restaurants and supermarkets in the city.

 

Property prices in Hanoi are going up almost by the day, driven partly by the city’s picturesque landscape and sound infrastructure. A tenth-floor apartment in the Vimeco building has increased from USUS$690 to USUS$1,000 a square meter, while an apartment in the Tay Trung Hoa - Nhan Chinh Urban Zone costs at least USUS$1,000 a square meter to buy.