Masterplan backlog plagues capital

City planning delays and a stagnant market have affected property developers in Hanoi

According to Nguyen Van Thinh, head of the Administration Department of the Hanoi People’s Committe, due to changes to the Hanoi Master Plan some of the projects had been halted to await instructions from the committee.

Thinh also said that other projects were idle due to the downturn in the real estate market.

 “Many developers aren’t pursuing their projects as they are waiting for a more vibrant market,” Thinh added.

“The committee has reviewed projects and reminded developers to stay on schedule, but this is very difficult for them right now,” he said.

Tran Anh Dung, head of the Inspectorate under the Minaistry of Natural Resources and Environment said many of the delayed projects were located in areas being re-envisioned by city planners.

“We will review all delayed projects and those which are suspended for obvious reasons will be allowed to extend their timetables,” he explained.

He added that any project that has been idle for a long period would get from three to six months from April 1 to restart. If their work fails to resume, they would face potential shut-down.

Several well-known delayed properties include a Financial and Trading complex invested in by TSQ Vietnam in Ha Dong district, and Petrowaco apartment tower on Lang Ha street, invested in by Petroleum Real Estate Company.

Notable partially-finished suspended projects include Habico Tower and Vinacapital’s Times Square.

Foreign-backed projects face the same issue. Even major projects such as Korean-backed Booyoung Vina in Ha Dong, and the Pacific Land Vietnam’s Habiotech project in Nam Thang Long area and a retail, office, apartment and sports centre backed by Russia’s Togi Vietnam in Me Linh district.

According to the latest figures from Savills Vietnam, about one-third of the 80 future apartment projects in Hanoi are moving at a snail’s pace. Of those, more than 90 per cent were domestic investments.

According to the Ministry of Construction (MoC), there were more than 300 real estate projects nationwide that had been suspended due to lack of finance.

The country now has 3,258 active real estate projects. Many of those, the MoC noted, could be restructured as smaller apartments for lower income buyers.

The Hanoi People’s Committee recently announced that it would not consider new commercial housing project proposals until the end of this year. The official figures released show that Hanoi is now home to more than 3,100 unsold apartments

The committee is also allowing developers to convert their commercial housing projects into social housing projects, to resolve current market stagnation.