|In front of the Ho Chi Minh City People's Committee headquarters. Photo: VNA |
Over 14 years ago, Ho Chi Minh City People’s Committee issued a list seeking investment in eight projects to build underground parking lots in various areas around the city.
A few years later, four of the projects were selected to assign to investors for implementation. However, today, not one of the ventures has started construction.
The underground parking project in Trong Dong Stage is considered the most feasible, and was granted an investment certificate by Ho Chi Minh City People’s Committee in 2010, to be developed by Dong Duong Group.
With around VND900 billion ($39.1 million) pumped into the scheme, it was planned to be built across 5,300 square metres with seven basements and three floors, with capacity for more than 700 cars and 400 motorbikes. But the project remains dormant because of disagreements between the local authorities and the investor.
Dong Duong Group said they had completed design evaluation procedures but a part of the project overlaps Metro Line 2, the Ben Thanh - Tham Luong line, which runs for 11km from districts 1 to 12. In addition to this, Ho Chi Minh City Planning and Architecture Department also requested the company to change the function of the project’s first floor from commercial purposes to a public space for community activities.
The company disagreed with this move because it had planned business activities for that floor as part of its plan to recover its capital investment.
A second underground parking lot started construction in 2010 by Underground Space Investment Development JSC (USID) with the total capital of $100 million in Le Van Tam Park. If complete, the project will offer space for more than 2,000 motorcycles and around 1,300 cars, buses, and vans. The scheme was officially revoked in 2019 because the developer could not balance the finance to implement it.
According to a source from USID, the construction costs for underground parking are five times higher than for those above ground, at about $2,000 per sq.m. On average, if each car needs 20sq.m, the cost of building a lot for that car is $40,000. Under the current regulations, with a parking fee of VND10,000 (45 US cents) for every hour in the investment plan, it would take many years to recover investment.
Delays have also been witnessed in two other underground parking lots at Tao Dan Park and Hoa Lu Stadium, primarily because of complicated administrative procedures, complicated design, and a range of special technical criteria and infeasible financial plans.
According to Ho Chi Minh City Department of Transport, as of the end of 2020, Ho Chi Minh City had more than 8.2 million vehicles of all types. Every day the city has seen more than 120 cars and 600 motorbikes newly registered.