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On Vietnam real estate: “There are opportunities, and the time is now”

More than 100 panelists, delegates and media attended this year’s Property Report Congress Vietnam, the first time that Property Report’s conference series was held in Ho Chi Minh City.

According to keynote speaker Marc Townsend, country head of CBRE Vietnam, Vietnam real estate is in a very good situation compared to the “nightmare” back in 2008, referring partly to the Global Financial Crisis.

“In Vietnam, you buy real estate first before you buy a car after you graduate from school,” he said.

One thing to note, per Townsend, was that the price of gold in Vietnam was still connected to real estate. There is also a movement away from cash to mortgage and loans, which is very important.

The primary market is very strong, especially in HCMC and Hanoi, but the secondary market is “absolutely flat,” while the hospitality markets of Nha Trang, Phu Quoc and especially Danang are quickly catching up to Asian neighbours.

Manufacturing hub can make a difference

Second keynote speaker Sigrid Zialcita, managing director of Asia Pacific research at Cushman & Wakefield, the long-term growth story of Vietnam real estate is positive in the ASEAN Economic Community era.

Hanoi and HCMC are moving up in the value chain as the country transforms itself into a more business-friendly environment due to new regulations, infrastructure improvements and trans-pacific partnerships (TPP).

Zialcita believes that there will be lots of opportunities in the next 15 years as urbanisation produces more affluent Vietnamese investors.

“And if Vietnam can differentiate itself from its neighbours as a manufacturing hub, then it can make a difference,” she predicted.

Finding the right partners, right now

The next panelists agreed that finding the right partners when forming a joint venture is key to achieving success in the country.

In the panel discussion “How to have a successful JV,” Stephen Wyatt, country head of JLL Vietnam, reiterated the importance of understanding joint venture partners who can bring something to the table rather than just adding up to the capital.

There is also a need to bring up compliance standards for JVs, according to panelist Ninh Vanh Hien of KPMG Vietnam.

“The best is yet to come for Vietnam real estate,” agreed Rudolf Hever, executive director of Alternaty Real Estate (Vietnam), another panelist. “There are opportunities here, and the time is now.”

In the discussion for “Skylines of the future: an insider’s guide to designing iconic buildings”, moderator Thien Duong, managing director of Transform Architecture, asked the expert panelists insightful questions, such as how developers can profit from building iconic structures.

Iconic structures in cities

He also said that Ho Chi Minh City has opportunities to build an iconic building to put it on the global real estate map.

“Every city wants something that sets it apart,” commented Bertil de Kleynen, director of architecture and landscape of Atkins Asia-Pacific. But he said that not all iconic buildings in a city should aim to be iconic, citing the unusual towers popping up in Chinese cities.

Greg Shands, renowned architect and founder of Greg Shand Architects, meanwhile, said that builders Vietnam should remember to shape the buildings according to the local climate. He believes that Vietnam has an inherently special value to host iconic structures. 

Developers’ mindset needs to be different

In the final panel discussion “Effective local and international marketing strategies for real estate,” which was moderated by Andrew Olejnik, co-founder of Homsters.com and CEO at Timhome.vn, sponsor of Property Report Congress Vietnam 2016, the panelists discussed the current trends that affect the Vietnamese online property market.

Per Steve Melhuish, vice-chairman and co-founder of organiser PropertyGuru Group, property is one of the most important asset classes in Asia. “It’s an ongoing trend and I think it’s going to continue. The mindset of developers needs to be different when targeting foreign buyers.”

Ha Vuong, director of Ho Chi Minh Branch of PropertyGuru affiliate Batdongsan.com.vn and the official property portal of the Vietnam Property Awards, said that while listings portal could not control the marketing message of developers, they could help improve it.

Bui Van, editor-in-chief of FNBC, reiterated the importance of understanding the Vietnamese customers and building their trust after most of them lost money or investments seven years ago during the global market crash.

Ian Paynton, content marketing consultant at Hashtagcontent.com, ended the discussion with an important message about content strategy for developer clients. “It has to be bespoke and it has to be the right message at the right time. How can developers stand out? With content.”

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By Richard Allan Aquino - Property Report

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