ASEAN KEY DESTINATIONS
Property brokers turn developers in HCM City
Many property agents in HCM City have made the step up to become developers themselves.
Last year more than 2,000 real estate companies and hundreds of brokers came into being, making competition more intense than ever.
Some brokers have taken the development route to survive.
Rio Land Real Estate Company set up in 2015 has launched a project named Rio Pto in District 9, with around 100 land lots starting at 80sq.m.
Company executives told Dau Tu (Vietnam Investment Review) newspaper that the company had to raise funds to buy land and launch the project in the market.
Lu Thi My Le, deputy general manager of Rio Land, said: "This is a small project, but we consider it successful because we have achieved the goal of switching from being a brokerage to a developer.”
Following the success, her company plans to launch another project also in District 9 this quarter, she said.
“The company continues to do brokerage work to sustain cash flows and keep its employees.”
BV Land, another real estate company, has also become a developer with its first project coming up in Bình Thạnh District.
Nguyen Huy Vu, general director of BV Land, told Đầu Tư newspaper that the mushrooming of brokerages has created fierce competition.
In the circumstances, companies with funds and experience like BV Land are investing as a long-term development strategy, he said.
Khai Hoan Land is a brokerage that has also set up a development arm.
Its first projects are expected to be launched in HCM City and Vung Tau this year.
Nguyen Van Hau, general director of Asian Holding Joint Stock Company, said that real estate firms need to be strong in terms of capital, relationships and business direction to be successful.
"I just started to do small projects to quickly sell the inventory, quickly recoup the investment and, especially, not go up against renowned and established developers."
But many brokers looking to make a quick buck have also been indulging in dubious activities.
For instance, Alibaba Real Estate Joint-Stock Company and Kim Phát Real Estate Company illegally sold land plots in the city and Dong Nai Province and have been sued by their customers as a result.
The general manager of a real estate company said the switch to investment by brokers is not simple because they lack experience in various areas like design, construction, and project management.
However, if they begin small, they could be successful, he added.
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