CapitaLand eyeing Vietnam office properties

CapitaLand is looking to invest in Vietnam's office property segment, its country head said, as the real estate developer seeks to grow its portfolio beyond residential and serviced apartments in the fast-growing economy.

Besides land, the company is looking to buy completed office buildings and upgrade them, Mr Chen Lian Pang, chief executive officer of CapitaLand Vietnam, told Reuters.

"If there is a potential to do asset enhancement, this is a kind of prime target that we are looking at," Mr Chen said.

Vietnam is currently recovering from a property market bubble that burst four years ago, helped by the government's moves to restructure the banking sector and ease restrictions on overseas buyers.

The recovery has prompted CapitaLand and other foreign developers, such as conglomerate Keppel Corp's unit Keppel Land, Amata Corp and Nishi Nippon Railroad, to expand in the country's property market.

Vietnam also has the fastest-growing middle class in South-east Asia, according to some estimates.

In 2012, the middle-class population was 12 million and is projected to increase to 33 million by 2020, according to The Japan Times.

It has been forecasted that the middle class will drive more than 50 per cent of the country's total consumption.

Vietnam is riding into another boom, with construction starting in Ho Chi Minh City on two of the world's tallest skyscrapers and buyers snapping up new projects fast, CNBC reported.

The speed of the market's turnaround has been startling. Successful property transactions have doubled from a year ago, and developers have halved their unsold inventory from US$6 billion (S$8.5 billion) at the peak of the crisis at the start of 2013.

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A version of this article appeared in the print edition of The Straits Times on December 22, 2015, with the headline CapitaLand eyeing Vietnam office properties. Subscribe