High-end properties pushed despite slump

Many developers are struggling with the downturn of real estate market, delaying and scaling down projects because of a huge amount of unsold properties. But Bitexco is still pursuing its latest project - the Manor Park City in Hanoi.

The Manor Park City will be developed into an eco-city with 1,066 townhouses and villas, and more than 8,000 apartments with total investment of $1.9 billion. Bitexco plans to build 250 townhouses and villas in the first phase, but more surprisingly, while other developers and policy makers are struggling to find ways to sell thousands of pricey stockpiled apartments, Bitexco still plans to build 500 high-end apartments.

Building high-end apartments at this time is considered one of the highest risks for developers, because over the last two years, transaction of high-end apartments has remained almost frozen. Moreover, the number of unsold apartments has been increased. According to CBRE, Hanoi now has stockpile of 21,600 units.

According to Tran The Viet, Bitexco project development director, the company’s management board has carefully considered all risks related to building up new apartments, but they still decide to invest in this segment.

Bitexco is not the only developer swimming against the current. Vietnam Sotheby’s International Realty also made a daring decision when it agreed to be sales agent for Fusion Suites,  a vacation property in Danang, and Watermark, a residential project in Hanoi.

Vacation property and high-end apartments are two most difficult segments for all marketing agencies during recent times due to low buyer interest.

So what is the motivation for Bitexco and Sotheby to face up with such big challenges - to invest in and sell  segments which are considered less prospective while the real estate market is falling into crisis?

Acknowledging the difficulties, Viet said that the company could not avoid downturn if it is still following the old way of building apartments like many other developers.

Bitexco’s strategy is to create a type of products which is totally different from others in quality, like the existing residential areas Manor Hanoi and Manor Ho Chi Minh City, which Bitexco successfully sold 10 years ago.

Viet said that apartments in The Manor Park City were  designed with reasonable space, started from 43 square metres, to larger ones in the upper stories with gardens. This large range of apartments can meet the demand of different types of customers.

Viet said the project had a large area for parks and public facilities, and its location  was largest “golden land” lot  left in the newly business district of Hanoi, which is suitable for developing an eco project.

Meanwhile, Vietnam Sotheby’s International Realty general director   Michael Piro said it was difficult to sell high-end properties in the current real estate crisis, but quality will attract buyers to Watermark,  even though its price is at the highest level now in the market – at average of $2,300 per square metre.