Wednesday, 22 Nov 2017

Recreational property requires giant developers

Updated at Thursday, 02 Mar 2017, 10:17
KTĐT - A lot of entertainment projects have been invested in the Central and the South of Vietnam where possess the favor of climate and spectacular views. However, the investment trends in recreational real estate have switched to the northern region, notably in Hanoi which are diversely in terms of variety and investors.
According to a number of experts, the entertainment real estate development is only set aside for giant property developers.
The recreational property blossomed in Hanoi and the north region
Him Lam Joint Stock Company has started the construction site of Hon Dau resort in Hon Dau island, Hai Phong city in the early May of 2016 with the total investment capital of to 5,000 billion VND, which, is scheduled to complete in the end of 2021. The whole construction covers an area of 4 sites including: Vung Xec, Hon Dau Island, the area constructed cable cars connecting Do Son peninsula to the resort and the expanded sea reclamation site with total area of 49.7 ha. Him Lam is planning to construct water parks, amusement parks and condo-hotels in this resort.
FLC Corporation has inaugurated and put into operation enormous the Vinh Thinh resort in Vinh Tuong district, Vinh Phuc province in the early of March 2016 with total investment of 600 billion VND covering  an area of 7.3 ha in  the phase I.
Moreover, FLC group is also intending to combine the resort with a large number of entertainment activates. The project is expected to have the total area of 250 ha, 30 times higher than the first phase, and the total investment of 5.000 billion VND, nearly 10 times higher than the previous phase.
The number of items which FLC is planning to build in the second phase are golf academy, spiritual area, recreational park modelled after Disneyland, national zoo, international villas and hotels with 5 star.
In the late of January, Sun Group, another giant developer, inaugurated Dragon Park belonging to the Sun World Ha Long Park (Quang Ninh city), which contains more than 30 world leading games. Infacts, Dragon Park is only the second item completed in the whole Sun World Ha Long Park constructed by Sun Group with the total investment of 6,000 billion VND.
Illustrative image
Illustrative image
Hanoi city, the politic cosmopolitan capital in Vietnam, witnessed the huge investment from the Sun Group in recreational property in the middle of last September 2016 with the groundbreaking ceremony of Kim Quy cultural, tourism and amusement park in Vinh Ngoc commune, Dong Anh district.
This is the first time that Hanoi Capital having the world class park which models important historical events containing the spirits of thousands years of civilization. With the total investment of 4,600 billion VND, Kim Quy park, which covers an area of more than 100 ha, is designed harmoniously between the unique culture of Co Loa Land of a thousand generations and leading model of Universal Studios, Disneyland.
Sun Group also inaugurated the latest and most modern cable cars with 3 lines in Fansipan Sapa in Sapa town, Lao Cai city, which began its construction in Novermber 2013 with the total investment in the first phase of 4,400 billion VND.
In the past two years, a lot of giant recreational property projects have been invested in the North, especially in Hanoi capital in order to exploit the huge demand of Hanoians as well as burgeoning middle class in the region.
The field will be not for “impoverished developers”
According to many property experts, entertainment real estate in the North, especially in Hanoi capital will remain huge potentials for investors because there is high demand for recreational activates with high–ranking standard among Hanoians and the growing middle income class. Therefore, property developers invest properly in the right way, the segment is expected to be a money-produced machine.
Ms. Do Thi Thu Hang, Deputy director of research department in Savills Hanoi said, conglomerates such as Sun Group, Vingroup, FLC Group have declared to invest huge amount of money in the recreational property because Vietnam, especially in the North is lacking modern and high-ranking entertainment activities.
Besides, pouring money into recreational real estate is the best way to lure consumers as well as investors in the outskirt of the project to buy other property items such as retail real estate, shophouse, or in some cases codotels and hotels.
However, Hang said, the segment requires huge capital, which only investors having strong financial capacity and careful-prepared strategy could be successful in operating in the field.
Nevertheless, according to Savills’ research, investing in recreational property will be a strong trend in the coming year. This segment not only boost the local tourism industry but also improve the value of other property items and other real estate developers.
Mr. Tran Ngoc Quang, Secretary General of Association of Vietnam Real Estate said, not all property developers has enough capacity to joint in this field. Hence, the sector needs the endorsement from Government in terms of strategic planning, priority policies to investors who intend to construct eco and natural resorts, he added.
He noted that the government should call for FDI firms participating in this field through completed and effective planning and well-equipped infrastructure.
According to a specialist from Global Integration and Business consult Firm (GIBC), Huynh Phuoc Nghia, in the field of recreational property, most of entertainment developers have only paid special attention to the wealthy class and international visitors.
Nghia said in order to lift the recreational property, three harmonious elements needed include tourism, entertainment and culture. Otherwise, the Government needs to shoulder with the private company in terms of preferable policies and guiding strategy.
Translated by Thuy Dung
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