Run-down apartment blocks face destruction
The HCM City Department of Construction plans to tear down 70 dilapidated apartment buildings over the next two years. Under the department's plan of renovating and building new apartment buildings, 61 of the 70 apartment buildings will be rebuilt and three of them renovated.
The remaining apartment buildings will be changed to buildings for trade and services. All of these buildings were built before 1975 and are in danger of collapse.
This year, the plan targets to complete land clearance and compensation for 20 apartment buildings with 3,000 households.
The plan will rebuild seven apartment buildings that will have a total of 1,850 apartment units this year. Despite being
After cuts in price of VND5-7 million ($242.7-339.8) per square metre, land prices at the Kim Chung-Di Trach project still remain at roughly VND50 million ($2,427) per square metre, with the Tan Tay Do project in Hoai Duc District at a comparative VND48-50 million per square metre. While the Tan Viet project in the district at around VND40 million ($1,941) per square metre.
Adjacent houses on Le Trong Tan reach highs of VND120-130 million (USD5,82-6,310) per square metre.
In contrast, in Ho Chi Minh City, Him Lam-Tan Hung project has the highest price of VND84.3 million ($4,092) per square metre, with other projects ranging from VND30 million and VND40 million per square metre.
Mrs Hoa, a bank clerk who recently moved to Ho Chi Minh City to live said, with VND1 billion ($48,543), she could easily buy a house in the southern city, but it was next to impossible in Hanoi.
Reasons for the disparity
The explanation for lower Ho Chi Minh City prices according to Mr Toan related to cheaper construction procedures.
In Ho Chi Minh City, real estate investors can access bank loans; and therefore, they have to sell real estate projects at lower prices to pay off mature loans. In Hanoi, most of investors use their own capital and therefore are under little compulsion to sell at a cheaper price.
Tran Nam, Deputy Minister of Construction, total real estate loans in 2010 reached VND224 trillion ($10.87 billion), up 22% compared to 2009.
In Ho Chi Minh City, real estate loans accounted for up to 47% of all bank loans, compared to just 16% in Hanoi.
Minh City also boasts far higher supplies of real estate, with the southern city long being home to larger new urban developments, which the capital has only recently begun experiencing.
Former Trade Minister Truong Dinh Tuyen said Hanoi had also seen large numbers of people migrating to the city from other localities, pushing up demand for land and housing.
Mr Giang, a real
agent, also said that Hanoi lacked enough suitable development land and that land lots and houses regularly increased in value several times between real estate agents before they had become available to customers.
Fast food chains hunt for retail premises, real estate market warms up
Analysts, while forecasting the arrival of many foreign fast food chains in Vietnam, believe that the real estate market would warm up in the war among the chains for retail premises.
Vietnam, retail premises, real estate, fast food, Burger King
There have been no positive forecasts about the recovery of the national economy in 2013. However, there have been a lot of pieces of news about the presence of international fast food chains in the near future in Vietnam.
Local newspapers these days repeatedly report about the plans to expand the networks of BBQ Chicken, Lotteria and Burger King. The information coincides with the result of the latest survey conducted by FTA, a market survey firm, about the Vietnamese consumption tendency.
The survey showed that the year 2013 would witness many more franchising agreements to be signed.
Woo Gil Je, Director of BBQ Vietnam, a subsidiary of Genesis Group of
Real Estate Saigon HCM
Korea, said a lot of investors have contacted the company to ask for investment cooperation. The investors have expressed their willingness to set up BBQ Chicken shops in HCM City, Hanoi, Da Nang, Hai Phong and Can Tho.
The director feels satisfactory about the suggestions for cooperation, saying that the places suggested by the investors are suitable to the BBQ Chicken’s business expansion strategy in 2015-2020.
BBQ Vietnam has been put under the direct management of the South Korean Genesis Group since the beginning of the year. Prior to that, the group signed a franchising contract with an individual who committed to develop BBQ Chicken brand in Vietnam.
Also according to the general director, in the plan to expand the network, the company would make heavier investment, push up media campaigns and improve the menus to make the dishes more suitable to the Vietnamese market.
Especially, he said, BBQ Chicken would develop new shop models – Chicken & Beer and Premium Coffee, and set up small scale shops at shopping malls and residential quarters.
The fast food chain not only targets big cities like Hanoi and HCM City, but is considering marching towards the markets near Hanoi such as Hai Duong, Hai Phong, Quang Ninh, Ninh Binh, Phu Tho and Thai Nguyen.
After 7 years of making its presence in Vietnam, BBQ Chicken has had 17 shops in Hanoi, including the 11 ones operating under the franchising contracts.
The franchising fee is about $42,000 for the shop on the area of less than 30 square meters, $53,000 for 80 square meter shops, and $87,500 for 130 square meter shops. These include the brand fee, training fee, deposit, interior designing and opening fees.
KFC and Lotteria made their presence in Vietnam sooner than BBQ. However, they don’t “sell” brands like BBQ, but have been doing business and managing the networks of shops themselves.
In 2011, when its 100th shop was opened, Lotteria announced that it was ready to franchise 100 percent or a part of its business. However, in late 2012, Lotteria announced the delay of the franchise plan to 2013 due to the economic difficulties, because of which it still could not find investors.
However, it seems that Lotteria has to speed up its franchise plan when the two redoubtable rivals from the US, McDonald’s and Burger King have shown their clear interests in the Vietnamese market.
General Director of Lotteria--Cho Young Jin, said the fast food chain plans to have one shop for every 160,000 consumers.