According to the government website, at a conference on social housing products for factory workers and low-income earners on August 1 chaired by Prime Minister Pham Minh Chinh, Novaland, which is owned by billionaire Bui Thanh Nhon, committed to develop 200,000 social housing products in HCM City and southern provinces.

Bui Xuan Huy, president of Novaland, said the group last week received a request on suggesting solutions that would allow each business to build 5,000-10,000 social housing apartments immediately.

Prior to that, in mid-May 2022, at the shareholders’ meeting of Vinhomes, a subsidiary of Vingroup owned by dollar billionaire Pham Nhat Vuong, approved a plan on building 500,000 social housing products priced from VND330 million in Hanoi, HCM City and Da Nang.

Vinhomes (VHM) is the No 1 real estate developer in Vietnam with turnover of $3.6 billion and post-tax profit of $1.7 billion in 2021. The business has been growing rapidly for many years, becoming the company with the largest capitalization value in the stock market.

VHM share prices, however, dropped sharply over last year, from VND86,000 per share to VND62,000, which led to a fall in capitalization value. However, Vinhomes is still one of three listed companies with value of over $10 billion.

In the past, Vinhomes planned to develop social housing, but it canceled the plan.

Most recently, especially since late Q1 2022, the real estate market has become quiet as commercial banks have tightened lending to prevent inflation and as management of the corporate bond market has been strictly controlled after the arrest of the president of Tan Hoang Minh.

Him Lam Group owned by Duong Cong Minh, who is also chair of Sacombank, has said that it is ready to develop 75,000 social housing apartments from now to 2030. The company said it has land, but needs to solve problems related to procedures.

To date, large enterprises and economic groups have registered to build nearly 1.3 million social housing apartments from now to 2030. If the apartments are assessed at VND300-500 million each, the total value of the projects would be $20-30 billion.

Vingroup and Novaland, the two largest real estate developers in Vietnam, are able to attract big amounts of money from domestic and foreign shareholders.

In June 2022, Novaland received investment capital of $250 million from Warburg Pincus in the US.

Nhon will use the capital to continue to expand its land bank and complete projects now under construction.

Duy Anh