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Thursday,  Dec 14,2017,15:11 (GMT+7)

Thu Thiem’s land prices forecast to rise 30-35%

Cao Ban
Wednesday,  Nov 29,2017,22:13 (GMT+7)
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Thu Thiem’s land prices forecast to rise 30-35%

Cao Ban

A bird’s eye view of Thu Thiem New Urban Area from the other side of the Saigon River - PHOTO: THANH HOA

HCMC – Land prices in Thu Thiem New Urban Area in District 2, HCMC are forecast to increase 30-35% in the coming time, according to property services provider Jones Lang LaSalle (JLL).

JLL said prices of residential units in the peninsula are currently 30-35% below District 1’s levels.

Meanwhile, in Shanghai, apartment prices in Pudong new center are 43% above the old central business district of Puxi, and Bonifacio prices are the same as Makati in the Philippines. Over time, the consultant expected Thu Thiem to follow a similar trend.

Stephen Wyatt, country head at JLL Vietnam, said Thu Thiem’s average land price is roughly one-third of District 1 and relatively low compared to neighboring districts such as Districts 3 and 4.

However, he added, with the establishment of Thu Thiem projects and some improvement in the legal and planning framework, it is reasonable to say that land prices will continue to increase in the coming years.

Land prices in Thu Thiem have picked up by 30 to 40% over the past three years. JLL said this is a record but appropriate rise as prices were rather low initially. A majority of housing projects there are selling well.

In Thu Thiem, some 45% of the total development areas have been officially approved through build-transfer agreements. Dai Quang Minh is developing the US$2.2-billion Sala housing project in Thu Thiem.

Around 10 investors have developed projects worth about US$5 billion. In addition to the Sala project, some other major projects include the Empire City project of Keppel Land, Gaw Capital Partners, Tien Phuoc JSC, and Tran Thai Real Estate Co Ltd; and the Eco smart
city project of Lotte Group.

Many overseas investors from China, Malaysia, Singapore, South Korea and Japan have expressed interest to invest in the peninsula. They are hunting for good investment opportunities in Thu Thiem at a reasonable land price through acquisition or joint venture with local partners.

The pace of development in Thu Thiem remained stagnant mainly because of land compensation issues.

As of this June, 99% of the total area in Thu Thiem had been fully compensated for, according to the District 2’s Resettlement Committee. 87 land lots have yet to be compensated for, including 83 households and four religious establishments.

Land has largely been handed over to investors but many lots of land there have yet to be developed, according to Stephen Wyatt.

Many investors revealed it was difficult for them to estimate the investment timeline and return, due to the lack of transparency in the investment procedure, he stressed.

He added developers, especially those with a strong investment appetite for commercial properties, are still waiting for more incentive policies for this area.

The 657-hectare new urban area is located opposite to District 1. Comprising 176 land lots with roughly 3.2 million square meters of residential space and 3.4 million square meters of commercial space, the total peninsula will eventually accommodate 145,000 residents plus 217,000 workers.

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