Keppel Land announced its plans to develop a residential township on a 509-ha
site in Dong Nai Province situated 28 km from Ho Chi Minh City (HCMC) in
partnership with the Dong Nai General Agriculture Service United Cooperative
(Dona Co-op) and Vietcombank Fund Management (VCBF). Keppel Land’s
equity interest will be 45% amounting to S$49m through its subsidiary with Dona
Co-op and VCBF holding the remaining 55% stake. The total investment capital
for the project is estimated at S$550m for the initial stage of a 193-ha parcel.
The river frontage site is a drive away from the Central Business district and will
feature about 14,000 homes, commercial and public amenities, with a potential
gross floor area of about 28 million sf. The site will be developed in phases with
the first phase expected to be launched in 2009 and will be cater to the middle
to upper middle income market.
Vietnam offers an attractive business environment due to the improved
framework and transparency, tax incentives and more recently its WTO entry
provides greater market access. The average GDP growth rate for Vietnam has
been 7.8% pas over the last five years with 2007 GDP target of 8.5%. HCMC is
currently experiencing a property boom supported by the rising affluence among
locals, increasing affordability levels and their preference to invest in real estate
as against other investment vehicles. Keppel Land was the pioneer in entering
Vietnam and boasts of the highest foreign direct investment in Vietnam. The
move by Keppel Land is in line with their expansion and diversification strategy
by setting strong presence in the Asia’s growth cities and benefit from the
property upcycle in that region.
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