Gamuda Bhd is investing US$53.9 million in 5.6 hectares (ha) of land in Vietnam to expand its international property development business, as the country appeals to foreign investors.
According to the developer, Vietnam has had steady GDP growth of six per cent to seven per cent in recent years, an expected population of over 104 million by 2030, strong yields on property investments, relatively reasonable land costs, and the establishment of conducive foreign ownership regulations in 2015.
Gamuda said that its wholly-owned foreign subsidiary in Vietnam, Gamuda Land HCMC Joint Stock Company (GL HCMC JSC) is acquiring the land, dubbed as UG5.6, in Binh Duong New City.
The site is part of a 1,052-ha integrated township that will serve as the administrative centre of the prosperous Binh Duong province of Vietnam.
The Binh Duong land purchase, according to Gamuda, is in line with its focus on foreign projects, which will account for two-thirds of its property sales in 2021. (FY2021).
"This strategy has seen the group through the challenging economic outlook of recent quarters, providing stable lines of revenue amid weaker sentiment and currency fluctuations in the domestic market," it said in a filing with Bursa Malaysia today.
According to the filing, GL HCMC JSC intends to build 349 units of landed properties, targeting the local market.
"The project development on the UG5.6 Land will be market-driven, catering to the township's growing residential and commercial demographics with a mix of townhouses and shophouses, giving homeowners the flexibility to conduct business on-premise," Gamuda said.
Gamuda said the project is estimated to have a gross development value of about RM495 million and contribute to the group's earnings.
It expects the Binh Duong acquisition is expected to be completed by the third quarter of 2022.
