The Giang Vo Exhibition Center, located on the so-called “golden land” in the center of Hanoi, has become “a tidbit difficult to swallow” as investors will face many responsibilities if they opt to exploit the land.

 

Real estate developers are concentrating on only one thing today, the golden land area in Hanoi.

The IPO (initial public offering) by Vietnam Exhibition & Trade Fair Center Company (VEFAC), slated for March 20, has caught the special attention of real estate developers, because the company owns the Giang Vo Exhibition Center situated on a very advantageous position in Hanoi.

Analysts, while declining to estimate how much the land plot is worth, affirmed that this is what “everyone lusts for”.

However, they have also warned that investors who want to take over the land will also have heavy responsibilities.

According to the Hanoi Stock Exchange, there are three component projects to be associated with VEFAC’s equitization, including the Nhat Tan – Noi Bai, Giang Vo and Me Tri projects.

A national exhibition and trade center will be built on the Nhat Tan – Noi Bai Road to replace the existing Giang Vo exhibition center. This will be a large center for national events, so it will require huge investment capital, estimated at VND4 trillion, not including costs for site clearance and construction.

This will be the “submerged part of the iceberg of obligations and responsibilities” the new investors will have to take on.

In order to approach the golden land area at No 148 Giang Vo Street, investors will have to implement the Nhat Tan – Noi Bai project and transfer it to VEFAC under the mode of BT (build, transfer).

This means that investors will have to spend at least VND4 trillion of their own money to build the new exhibition center and hand over it to VEFAC.

However, analysts said, the Nhat Tan–Noi Bai project completion is not the biggest challenge the new investors have to face. They will also have to satisfy many strict requirements, including the pace of implementation. 

The new exhibition and trade fair center must be completed and handed over to VEFAC by the end of 2018, or the investors will have their right to implement the project without getting the investment capital disbursement.

Analysts commented that this is an impossible mission because three years will not be enough time to implement such a big project, especially when the requirements of the project have not been clarified.

Vingroup, the largest real estate group in the country, has expressed its willingness to acquire the golden land area. However, analysts believe that it would be a challenge even to the group with powerful financial capability and experience.

Hai Minh