M&A in real estate sector to increase in 2018
Merger and acquisition (M&A) deals in Vietnam’s real estate sector are forecast to increase in 2018, driven by the market’s significant potential, experts said.
Dang Xuan Minh, general director of AVM Vietnam & Vietnam M&A Forum, said the domestic property market was embarking on a second wave of M&A, after 2015, which would be fuelled by the hastened privatisation of State-owned enterprises and the increasing interests of foreign investors.
The M&A market was expected to touch US$8 billion this year, of which the value of property deals accounted for the largest part, Minh said, adding average value was some US$50-60 million per deal.
M&A deals in the real estate sector were estimated at some US$2 billion this year.
According to Phan Xuan Can, chairman of property consultancy firm Sohovietnam, the announced M&A deals in the real estate sector were just the tip of the iceberg, and many deals were not disclosed.
Can estimated that the value of M&A deals in the real estate sector accounted for just 20-30% of the real value.
In 2018, many mega deals were expected to take place, mainly in the segments of apartment, office, tourism property and urban land, Can said.
According to Pham Thanh Hung, the rapid international integration of Vietnam will have significant impact on the real estate market.
Hung said the property market is attracting foreign investors, adding that there was an increasing wave of investment in Vietnam’s property market from Japan, the Republic of Korea, Singapore and China, as well as Germany and the United Kingdom, especially in the high-end segments.
Duong Thuy Dung, director of Research and Consulting, CBRE Vietnam, said M&A in the real estate market was also fuelled by the improvement in market transparency and simplification of procedures. The M&A trend would continue in the future and this would infuse fresh capital into the market, Dung said.
Statistics of batdongsan.com.vn which had an average 50 million page views per month, showed there were a large number of online searches related to Vietnam’s property market in the apartment and villa segments in Hanoi and HCM City from Singapore, the United States, Japan, the Republic of Korea and Australia.