Real estate conglomerates vie for Hanoi railway projects

Hanoi has submitted a plan to auction 6,000 hectares of land to build 10 urban railway lines from now to 2030.

Six Vietnamese and two foreign investors have registered to develop urban railway projects (subway), namely Vingroup, Xuan Thanh Group, Lung Lo 5 JSC, Mosmetrotroy from Russia, Tan Hoang Minh Co Ltd, the joint name of Licogi and MIK Group Vietnam, and Lotte.

Most of the investors are the ‘big guys’ in the real estate sector. The investors all registered the projects immediately after Hanoi called for private investment in the projects.

Thanh Nien quoted a source as reporting that to attract private investors, Hanoi plans to allocate land along the subway system to the investors for exchange for their capital to build the subway.

By the time the railway system is completed, there would be residential quarters on both sides of the route to use the project. Urban areas and shopping centers would be set up within a radius of 500 meters around subway stations.

The project will be implemented under the mode of PPP under which investors can use land to develop urban infrastructure and shopping centers.

Do Thi Thu Hang from Savills, a real estate service provider, noted there is no available land in the inner districts of Cau Giay, Thanh Xuan, Tay Ho and Dong Da.

There potential land plots in the suburban districts of Hoai Duc, Quoc Oai, Dong Anh, Thach That, Ha Dong and Long Bien.

This opens up many opportunities for infrastructure projects, especially urban railways heading towards the area.

These include the Metro 2A route from Ha Dong district to the center, the Metro 3 route running along Highway 32 linking Hoai Duc district to the center, and the Thang Long Boulevard metro route that connects Thach That and Quoc Oai areas with My Dinh.

Highway 18 that connects National Highway 5 and Dong Anh area is another area that can be used.

If the infrastructure projects can be developed, there would be more successful urban areas like Ecopark along new urban railways systems.

The land along urban railway systems is expected to become very valuable. In a report on the impact of the urban railway on the real estate market, CBRE said the land price would increase, while the number of real estate projects in the areas would explode.