Genesis Global Capital closed a cooperation agreement on Sunday with a Vietnamese property developer, under which the Singaporean investment fund will pump a total of US$300 million into the Ho Chi Minh City-based company in six installments.
For the next six years, Phuc Khang Corp. will receive orders to build $50 million worth of international-standard apartments annually from Genesis Global Capital, according to the deal.
The apartments target buyers who are foreign businessmen, investors and overseas Vietnamese who want to own homes in Vietnam, according to the Singaporean firm.
Genesis Global Capital has also committed itself to buying 30 percent of the apartments available at the Diamond Lotus, a condo project Phuc Khang is developing in District 8, Ho Chi Minh City.
The Diamond Lotus, which consists of three 22-story apartment blocks, is being constructed at a cost of VND1.26 trillion ($56.25 million), according to Phuc Khang Corp.
Genesis Global Capital is offering attractive investment opportunities by co-developing properties in Germany, Brazil, and the U.S., and Vietnam is the latest to join the list, according to managing director Ng Chuan Kai.
Phuc Khang Corp. has been chosen as the Singaporean fund’s partner because the Vietnamese company has successfully developed products that meet global green standards, Ng said.
Vietnam has recently allowed foreign ownership of apartments, and Genesis Global Capital wants to embrace the potential from this newly open market, according to the director.
Vu Xuan Thien, deputy head of the agency that oversees housing and the realty market under the Vietnamese Ministry of Construction, said the partnership between Phuc Khang and the Singaporean investment fund is like “exporting local realty products.”
“Phuc Khang Corp. is one of the first property developers to sign such a major contract to export its products,” he said at the signing ceremony.
Foreigners are now permitted to buy houses and apartments in Vietnam, following a new ruling which took effect on July 1.
Foreign individuals and organizations are entitled to possess no more than 30 percent of the number of apartments in a condominium project in Vietnam, according to the Ministry of Construction.
The foreign ownership is valid for 50 years, and can be extended by the same term only once.