Uncertainty mounts of Eurowindow’s suspected sale of unlicensed apartments

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The Eurowindow Multi Complex, under the former name Trung Hoa mixed use complex based in Cau Giay district in Hanoi developed by Construction and High Technology Department Investment JSC (Decotech), a business under Eurowindow Holding. It has a projected investment fund of $51.3 million.

Based on the project’s earlier received building permit, granted by the Hanoi Municipal Department of Construction, and design documents, the project would occupy 4,000 square metres and consist of 25 floors. This would include a five floor retail space with the remaining 20 storeys reserved for living blocks and offices for lease. The living block would include 90 apartments ranging from 82 to 148 square metres.

But recently the office plan was scrapped and repackaged as apartment blocks, bringing the total number of units in the building to 300.

The original apartment space (90 units) was allocated by the state on a long-term lease basis while other segments of the building only feature 50-year term leases.

After getting a building permit from the Hanoi Municipal Department of Construction for the initial design, in 2011 the developer again met with the city’s authorities to request permission to convert part of the project’s office space to apartments.

In June 2011, the Hanoi Municipal People’s Committee granted in-principle approval of the change and asked the developer to take the appropriate steps. But although it has yet to complete the procedures as requested, the developer has already begun renovations.

In light of this, in March 2013, construction inspectors issued Decision 21/QD-XPHC, to sanction developer Decotech, while in the meantime the Hanoi Municipal Department of Construction enacted dispatch 2275/SXD, dated April 2013, which reported the violations to the city authorities.

The project continued to push the envelope when it started changing the usage function from serviced apartments for lease into commercial apartments for sale, arguing that the former was ineffective due to the bad economy.

In May 2013, the Hanoi Municipal People’s Committee issued Dispatch 2436, granting in-principle approval of the change and assigned the Hanoi Municipal Department of Planning and Architecture to guide the developer in taking the appropriate steps.

Then, in April 2014, the committee enacted another dispatch which only confirmed the in-principle approval but did not yet fully green-light the change.

In its response to the media about the case on April 15, the developer said “We have taken the initiative in reporting and asking for a change in usage function as required by law. The legal procedures are underway and will soon be finished.”

The problem is that while waiting for approval, the project has sold massive numbers of apartments online. In fact, the apartments are nearly sold out since going on sale in March 2013.

So what of the validity of the apartment sales conducted before the project has been approved for building apartments for sale by authorities?

Eurowindow Holding is the investment management firm of global group T&M Trans in Vietnam. Alongside successful brands in the Vietnamese market such as Eurowindow and Meling Plaza, the company’s current focus is construction and real estate.