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Local property developers look west
Vietnamese property developers, seeing few opportunities in the gloomy, overbuilt homefront, are now exploring opportunities in Myanmar, widely considered the next frontier of Asia's economic transformation.
Last week, Hoang Anh Gia Lai (HAGL), one of the leading property firm in Vietnam, announced that it has secured a licence from the Myanmar government to develop a $300 million in Yangon that will include a five-star hotel, two office buildings, a shopping mall and eight blocks of apartments.
At this time, the site has been cleared. Doan Nguyen Duc, chairman of HAGL,said that the firm was willing to start constructing the project in 2013 in expectation of a complete within six or seven years.
Meanwhile, C.T Group, a prominent player in the Ho Chi Minh City property field, could follow HAGL's lead and become the second Vietnamese developer acquiring a license for a property project in Myanmar.
Tran Kim Chung, chairman of C.T Group, told VIR that the firm targeted a land plot for constructing a shopping centre, not far from the site of Hoang Anh Gia Lai Myanmar Centre project. The local authorities agreed with the plan and the firm is trying to get approval from officials, Chung said.
Chung also said that it might be take two years to finish the development and after its completion, it will be home of many Vietnamese goods brands, which are exporting to the nation.
BIDV, Thien Minh Group are also eyeing the market.
Tran Trong Kien, chairman of Thien Minh Group, the new owner of Victoria Hotel and Resorts chain, said that Myanmar is really an immature market. Investing in the market currently brings us a little of risk but in the long term, it is a potential "I don't want to miss," said Kien.
Chung agreed with Kien and said that Myanmar today is similar to Vietnam in 20 years ago, when it lacked modern shopping malls, high-standard office buildings, tourist hotels for tourists and of course residential units to serve demand of local residents and foreigners flocking to the nation.
Chung said that the country is offering big opportunities for developers. However, Chung emphad that investors should be careful as the land prices in Myanmar had been increasing for several years and lead to a hazardous price bubble.
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