Stunning coastline will act as a backdrop to the beachfront course
The fund managers last week signed a development agreement for a 262 hectare site, which stretches along a one kilometre beach frontage. Schematics for the project include a golf course, convention centre and resort complex.
Joining forces to back the development, Vinaland and VOF will claim the land use rights from the existing holder who has failed to meet basic requirements in developing the site.
The development, to be capitalised at $100 million, will be developed by a wholly foreign-owned entity, into which Vinaland will drive a 75 per cent stake, and VOF the remainder.
The property will be shapeup over the next three years, and once completed will offer a 36-hole golf course, residential villas and a beachfront resort hotel.
The golf course will offer private villas on a 20 hectares, which will be available for private sale. Support infrastructure is already in place, and the land is expected to be ready for development in nine months.
VinaCapital, which manages both VinaLand and VOF, said capital was committed to developing the site into a prime leisure development, and the fund was looking to work on other projects in Danang in the future.
The announcement comes as Danang authorities get tough on beachfront resort developments, a dozen of which were planned and approved some years ago, but have failed to progress further.
The Danang Tourism Department said 23 developments have been approved for development along the coast from Son Tra peninsula to Hoi An in neighbouring Quang Nam province. However, few have opened for business.
Investment consultants say many of the developers in the area are cash strapped and are unable to move on with planned developments. They set up projects to acquire land before attempting to raise development funds, or simply on-sold development rights to other developers for profit.
With ready cash, Vinaland and VOF make a strong proposition to develop empty but beautiful stretches of beach front into a luxurious holiday destinations. Vinaland and VOF are armed with $250m and $171m respectively.
Poor access to Danang is discouraging developers to move quickly on projects. Access by land to the area is arduous, while Danang airport is still too small to receive international flights from further afield than Singapore and Bangkok.
However, VinaCapital hopes the new $75m international airport that is under construction will boost Danang’s tourism.
“Tourist numbers have been increasing at an annual average of 8 per cent over the past five years... and are expected to continue to rise rapidly over the next five years,” VinaCapital said in a release to Vietnam Investment Review.
Indochina Capital, another fund management company, is bullish on central Vietnam. The company is due to open the Nam Hai, a 60-room hotel and 45 residential villa complex, near Hoi An by the end of this year.
The company, which plans to raise up to $200m for the second real estate fund, has acquired a prime riverside chunk of land in Danang, and is developing it into a shopping, office and apartment complex at the cost of $25m.
In addition to the Vinaland/VOF proposal, the central coast, touted by Forbes magazine as one of the world’s most luxurious beaches, will see another 27-hole course developed by a local company.
A South Korean firm is also planning an 18-hole course in Danang.
Four major resorts are currently in operation along the Danang-Hoi An coast, including Furama, Sandy Beach, Palm Garden and Golden Sand, with a total 720 rooms.
No. 764/June 5-11, 2006
Ngoc Son (vir.com.vn)