On April 12, International Financial Corporation (IFC) announced it had subscribed to a roughly $44 million bond to be issued by Nam Long Investment Corporation – a leading housing developer in Vietnam.
This investment is supporting Nam Long to develop sustainable green housing for workers in a satellite city near the economic hub of Ho Chi Minh City. IFC's investment is expected to create 1,500 jobs, with the township housing over 50,000 people.
|Waterpoint Nam Long, an integrated township located in Long An province |
The proceeds will be used by Nam Long for the second phase of the Waterpoint housing project, part of a broader integrated township development which will feature green public spaces, sporting facilities, schools, a university, and medical facilities. Transport links, retail spaces, and offices will also be provided.
Tran Xuan Ngoc, CEO at Nam Long said, "IFC's investment will help boost our capacity to provide more housing units for the growing number of middle-income residents in Vietnam. Since over 5,000 apartments in the Waterpoint phase II project will be developed in line with the company's Excellence in Design for Greater Efficiencies (EDGE) green building standards, it will address the country's acute housing shortage in a sustainable manner."
EDGE will help the project reduce the consumption of power, water, and embodied energy in materials by at least 20 per cent compared to similar housing projects. This will allow the building sector to lower its greenhouse gas emissions, which account for about 28 per cent of the country's total annually.
During his five-day stay, Alfonso Garcia Mora, IFC regional vice president for Asia-Pacific pointed out, "Vietnam has set ambitious goals to become a high-income country by 2045 and to achieve carbon-neutral status by 2050, so financing for a development of this kind delivers multiple benefits."
"Environmentally sustainable housing in townships which connect people to jobs in major commercial hubs is a win on the climate front and will increase the supply of quality housing for the country's growing middle class," said Mora.
Vietnam's fast-paced economic growth has led to rapid urbanisation with more than a third of its 96.5 million people living and working in urban areas.
Moving forward, the country faces a substantial housing deficit of over 370,000 units annually, especially in industrial zones and satellite cities surrounding the economic hubs of Hanoi and Ho Chi Minh City. With domestic manufacturing now re-opening, continued capital investment is critical and likely to primarily be channelled to those areas.
IFC is the largest global development institution focused on the private sector in emerging markets, working in more than 100 countries. In the fiscal year 2021, it committed a record $31.5 billion to private companies and financial institutions in developing countries, leveraging the power of the private sector to end extreme poverty and boost shared prosperity as economies grapple with the impacts of the pandemic.
Last year, Nam Long achieved $226 million in net revenue, double that of the same period last year. Profit after tax reached $64 million, up 74 per cent on-year.