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VIETNAM: INVESTING IN REAL ESTATE SECTOR - Now or never!

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VIETNAM: INVESTING IN REAL ESTATE SECTOR - Now or never!

  1. 1. www.duanemorris.com ©2010 Duane Morris LLP. All Rights Reserved. Duane Morris is a registered service mark of Duane Morris LLP. Duane Morris – Firm and Affiliate Offices | New York | London | Singapore | Los Angeles | Chicago | Houston | Hanoi | Philadelphia | San Diego | San Francisco | Baltimore | Boston | Washington, D.C. Las Vegas | Atlanta | Miami | Pittsburgh | Newark | Boca Raton | Wilmington | Cherry Hill | Princeton | Lake Tahoe | Ho Chi Minh City | Duane Morris LLP – A Delaware limited liability partnership DR. OLIVER MASSMANN - Partner, General Director DUANE MORRIS VIETNAM LLC VIETNAM: INVESTING IN REAL ESTATE SECTOR Now or never!
  2. 2. www.duanemorris.com AGENDA • COUNTRY BACKGROUND – ATTRACTIVE REASONS TO COME IN REAL ESTATE MARKET IN VIETNAM  WHAT IS HAPPENNING INSIDE VIETNAM?  VIETNAM’S INTEGRATION TO REGIONAL AND INTERNATIONAL ECONOMY • LAW ON RESIDENTIAL HOUSING – WHAT’S NEW? • HOW TO TAKE THE BEST ADVANTAGE OF THE OPPORTUNITY? 2
  3. 3. www.duanemorris.com Welcome to the most dynamic country on this planet : Vietnam! 3
  4. 4. www.duanemorris.com Vietnam’s super rich population is growing faster than anywhere else…. 4 … and is on track to continue leading the growth in the next decade
  5. 5. www.duanemorris.com Communist Vietnam Has More Millionaires Than Capitalist Philippines 5
  6. 6. www.duanemorris.com Rapid urbanization 6 Source: CBRE
  7. 7. www.duanemorris.com Rapid urbanization (cont.) • By 2020, 50% of Vietnam’s population (of 100 million) will live in urban areas/cities. • ~374,000 additional housing units will be needed in cities every year to cope with rising demand 7 Source: World Bank
  8. 8. www.duanemorris.com VIETNAM’S INTEGRATION TO REGIONAL AND INTERNATIONAL ECONOMY 8
  9. 9. www.duanemorris.com Without TPP – What’s next? • TPP-11? • Trade Facilitation Agreement • ASEAN Economic Community (covering 620 million people of 10 ASEAN countries) • EU – Vietnam Free Trade Agreement • Regional Comprehensive Economic Partnership (RCEP) (covering 3 billion people in 16 countries and 28% of global trade) • Bilateral trade agreement with the United States? 9
  10. 10. www.duanemorris.com10
  11. 11. www.duanemorris.com Key characteristics of AEC 11
  12. 12. www.duanemorris.com Legal certainty in new generation of FTAs • As a result of global integration, Vietnam has to develop legal certainty to be member of international trade organizations. • Once the EU-Vietnam Free Trade Agreement (EVFTA) are ratified, Vietnam will have more legal certainty than even Germany. • EVFTA implements investor-to-state dispute settlement (ISDS) mechanisms – investors can claim in case that an investor protection obligation has been breached • Domestic courts cannot question the legal validity of the decisions EVFTA secures a modern reformed investment dispute resolution standard 12
  13. 13. www.duanemorris.com More investment – More demand for space 13
  14. 14. www.duanemorris.com More investment – More demand for space (cont.) The manufacturing sector: primary beneficiary of FDI  more demand for industrial parks and logistics/distribution centers 14
  15. 15. www.duanemorris.com More investment – More people coming: Opportunity for residential housing sector 15 WHERE TO LIVE???
  16. 16. www.duanemorris.com Who can buy property in Vietnam? • Vietnamese organizations, households or individuals • Overseas Vietnamese • Foreign entities who invest in project-based housing construction in Vietnam • Foreign-invested enterprises, branches, representative offices of foreign enterprises, foreign-invested funds and branches of foreign banks operating in Vietnam • Foreign individuals who are allowed to enter Vietnam 16
  17. 17. www.duanemorris.com Who can buy property in Vietnam? (cont.) • Get married to a Vietnamese • and own a house on a freehold basis 17
  18. 18. www.duanemorris.com INVESTING IN VIETNAM 18
  19. 19. www.duanemorris.com WTO ANALYSIS OF LIBERALIZATION OF MARKET ACCESS • Typical restrictions: number of opened sectors, JV requirement, limits on foreign-owned shares, permission requirement Copyright Oliver Massmann - All rights reserved Country Limitation of market access* Country Limitation of market access* Malaysia medium Myanmar high Indonesia medium Cambodia medium Philippines medium Laos medium Singapore low India high Thailand medium China medium Brunei high Vietnam low
  20. 20. www.duanemorris.com Invest in Vietnam’s real estate before 2018 • When the EVFTA is very much likely to be ratified • Investors who take this opportunity to invest now are one step ahead others before competition becomes fierce for Vietnam’s real estate market. 20
  21. 21. www.duanemorris.com Tips for making investment • Due diligence well before making any investment • Hiring international legal professionals because only they can provide a liabilities insurance investors can rely on • Red book 21
  22. 22. www.duanemorris.com Questions & Answers 22
  23. 23. www.duanemorris.com DUANE MORRIS VIETNAM LLC Thank you very much! HANOI OFFICE HO CHI MINH CITY OFFICE Pacific Place, Unit V1307/08, 13th Floor, Suite 1503/04, Saigon Tower 83B Ly Thuong Kiet, Hoan Kiem District 29 Le Duan Street, District 1 Hanoi, Vietnam Ho Chi Minh City, Vietnam Tel.: +84 4 39462200 Tel.: +84 8 3824 0240 Fax: +84 4 3946 1311 Fax: +84 8 3824 0241 Contact email: omassmann@duanemorris.com This presentation is protected by latest Copyright software that enables the right holder to track it. Do not distribute this presentation or use content without written consent of the Author Oliver Massmann. 23
  24. 24. www.duanemorris.com References (1) 24
  25. 25. www.duanemorris.com References (2) 25
  26. 26. www.duanemorris.com References (3) 26
  27. 27. www.duanemorris.com References (4) 27

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