Invest in: Cam Ranh, Vietnam’s Hottest Hospitality Market

Posted in Market Report, What to Buy

The unspoilt coastline of southeast Vietnam has become a property investor hotspot in Asia. It belongs to the Khanh Hoa province which has grown in popularity for its pristine beaches and year-round tropical climate. But beyond its natural beauty, Cam Ranh lures investors with its secluded refuge, idyllic seafront views, flourishing connectivity to international airports, tempting price point, and most importantly its appreciating value with government policies and burgeoning new properties in development including integrated resorts. Here are the three reasons why Cam Ranh is heating up to be Southeast Asia’s hottest property investment. 

Secluded and Untouched by Mass Tourism 

Cam Ranh has been under the radar as Vietnam’s best kept secret until recently. A promising venture, the once primitive landscape is still very much in its original rural beauty without the crowds of more populated travel destinations. The Cam Ranh peninsula’s white sand and crystal waters are a traveler’s paradise, making investors eager to be one of the first to tap into the land.

Compared to Southeast Asia’s top sun and sand destinations like Bali, Phuket, Boracay, or even Nha Trang (just 45km north and sharing a coast with Cam Ranh) which boast the same picturesque views and vibes, the privacy and solitude is unbeatable at Cam Ranh. With such similarities, it is predicted that Cam Ranh too, will become a tourism capital. Moreover, neighbouring destination Nha Trang is showing signs of tourist overload, making Cam Ranh an easy vacationing alternative within the region. 

Accessibility and Connectivity 

The international terminal at Cam Ranh International Airport has undergone a HK$1.27 billion (US$163 million) renovation and opened in 2018 to accommodate more direct flights, reducing travel time and inconvenience. The airport sees 10 million passengers a year, and is one of the busiest airports in Vietnam together with Ho Chi Minh, Hanoi and Da Nang, with direct flights to and from mega metropolises like Hong Kong, Bangkok, Seoul, Shanghai, and Taipei. With easier accessibility and more potential routes from Tokyo and Singapore, Cam Ranh will be open to further tourism for its convenient logistics. Apart from its airport, Vietnam’s visa requirements are minimal and can be processed upon arrival, making it all the more simple (and convenient) for travellers.

Appreciating Value with New Developments on the Rise 

Many resorts are currently being constructed at a rapid pace, and there are further plans to erect more luxury hotels, apartments villas, and holiday houses. Pioneering projects such as Cam Ranh Riviera, Fusion Resort, Dessole Sea Lion and Mövenpick Hotels & Resorts have been running with great success and new development projects are currently going underway.

The Nha Trang Bay Investment and Construction Joint Stock has since been one of the most attractive ventures, with tourist experiences becoming increasingly exciting. These integrated resorts include casino expansions with the Vietnam Prime Minster deciding on investing in casino businesses such as KN Paradise Cam Ranh as part of the country’s proposal of the Ministry of Planning an Investment in 2019.

With the KN Paradise expected completion date scheduled for 2025, investors are eager to get a piece of the pie before the value of the market skyrockets. It is currently the fastest growing up-and-coming area in Southeast Asia, suited for luxury high spending tourism and coastal residences. Aside from resorts and villas, golf courses, shopping malls, and boat marinas will also be constructed. 

Dara Chau

Why Vietnam Is Asia’s Hottest Luxury Property Market

Posted in Market Report

The Grand Manhattan embraces the latest in New York living. The 39-storey development will house flats, a hotel, restaurants and some of the most expensive real estate in the country. But instead of Central Park views, it’s located in Ho Chi Minh City’s District 1, better known as Saigon’s Wall Street.

It’s the latest brainchild of Bui Thanh Nhon, a former seller of veterinary medicine who’s built his Novaland Group into one of Vietnam’s largest property companies. The chairman’s majority ownership means he’s amassed a fortune of around US$800 million, according to the Bloomberg Billionaires Index.

Such opulence would have been inconceivable in 1995 when Nhon shifted Novaland into real estate. The communist country has since become one of the fastest-growing economies in the world. Expansion has averaged more than 6 per cent per year over the past 20 years, after Vietnam opened up to foreign investment and began taking the shackles off its private-sector companies. More recently, factories have been relocating from Southern China, helping GDP growth to top 7 per cent last year.

That’s spurring overseas investors to target the nation’s real estate, alongside a rapidly growing cohort of well-heeled domestic buyers, eager to put hard currency into property. In a world where home prices are looking precarious from London to Hong Kong, Sydney and New York, it makes Vietnam an attractive location.

Vietnam is “where southern China was 10 or 15 years ago,” said Goodwin Gaw, chairman of Hong Kong-based private-equity firm Gaw Capital Partners, which oversees US$17 billion in real estate assets globally. It’s no longer a sure thing considering home prices have been rising steadily over the past 18 months, but “long term it’s still very good if you’re able to hunker down.”

Prices for luxury condominiums in Ho Chi Minh City climbed 17 per cent in 2018 to an average of US$5,518 per square meter, according to CBRE Group. The firm forecasts they’ll climb nearly 10 per cent by early 2020 to US$6,000 per square metre. More affordable condos in the city only increased 1 per cent last year.

Nhon’s project contains two and three-bedroom units that start from US$6,000 per square metre. While that’s almost double the price for a typical high-end flat in Ho Chi Minh City, it’s a fraction of the cost in Singapore, Tokyo or Hong Kong, the world’s least affordable market.

While demand from overseas investors remains strong, the latest wave of buyers are Vietnam’s newly prosperous. The number of people with net assets of US$30 million or more increased by 320 per cent from 2006 and 2016, the fastest pace globally ahead of India and China, according to a 2017 report by Knight Frank.

Many Vietnamese have built their wealth with real estate, according to Chris Freund, founder of private-equity firm Mekong Capital. Home ownership rates exceed 90 per cent, one of the highest in the world. Rising values mean there are middle-class families with dwellings in excess of US$1 million.

Neil MacGregor, a managing director at Savills Vietnam, the sales agent for The Grand Manhattan, said developers used to focus on the middle class but are now turning their attention to the more affluent. “We have more and more very rich Vietnamese, particularly entrepreneurs looking for places to put their money,” he said.

Novaland isn’t without competition. CapitaLand, Singapore’s largest developer, has similarly luxurious projects in Ho Chi Minh City and the country’s capital Hanoi.

Land supply in central locations, however, is extremely tight, one reason the wealthy are keen to buy now, according to MacGregor. Another factor driving demand for urban flats is the shift away from the Asian tradition of several generations living under one roof.

“We’re seeing a significant change, where young couples prefer to escape from their parents after marriage,” said Duong Thuy Dung, a senior director at CBRE. “They like to buy condos in gated communities.”

Despite Novaland’s prominence — it’s Vietnam’s second-largest listed developer — little is known about Nhon. Born in 1958, he started the firm in 1992 selling animal health care products after studying agriculture at Ho Chi Minh City University of Agriculture and Forestry. Now, units sold by Novaland account for about a quarter of all flats sold in the city.

“Most Asian businesses always turn to real estate when they become successful in whatever core business they have,” said Andy Ho, chief investment officer at VinaCapital Group, which invested in Novaland via its London-listed Vietnam Opportunity Fund. “When their country’s wealth grows up, people buy real estate.”

Staff Writer