Bloomberg Anywhere Remote Login Bloomberg Terminal Demo Request


Connecting decision makers to a dynamic network of information, people and ideas, Bloomberg quickly and accurately delivers business and financial information, news and insight around the world.


Financial Products

Enterprise Products


Customer Support

  • Americas

    +1 212 318 2000

  • Europe, Middle East, & Africa

    +44 20 7330 7500

  • Asia Pacific

    +65 6212 1000


Industry Products

Media Services

Follow Us

Vietnamese Developer to Tap Nascent Suburban Housing Need

Vietnam housing
Residential properties stand near a construction site in Hanoi. Strong demand for affordable housing in Vietnam as the country urbanizes has helped overcome a “challenging” national property market in recent years, the International Finance Corp. said in February. Photographer: Brent Lewin/Bloomberg

Nam Long Investment Corp., Vietnam’s biggest affordable housing developer, plans to move to building satellite towns, which are taking hold as rising incomes in Southeast Asia feed surging demand for suburban-style living.

Nam Long, which started trading a year ago on the Ho Chi Minh City Stock Exchange, is targeting a 10-fold increase in its market capitalization to $1 billion by 2020, by developing suburban-style communities on its blocks of land, including in the province of Long An, a gateway to the country’s rice-growing Mekong Delta.

Strong demand for affordable housing in Vietnam as the country urbanizes has helped overcome a “challenging” national property market in recent years, the International Finance Corp. said in February. Nam Long wants to reduce the percentage of overall revenue generated by its affordable housing business to one-third by 2019 from about 90 percent now, according to Chief Executive Nguyen Vinh Tran, based in Ho Chi Minh City.

“I have to address the shareholder return,” said Tran in an interview yesterday. “Land development--that’s where the margin is. Eventually our business model is that the affordable housing provides a very stable, predictable revenue stream every year that you can depend on, but at the same time you have to develop your other revenue streams.”

Nam Long reported after-tax profit of 34.5 billion dong ($1.6 million) last year on net revenue of 601.7 billion dong. Margins of about 10 percent from the company’s affordable housing business demonstrate the need to expand into areas which will generate greater shareholder return, said Tran.

The stock has gained 3.5 percent this year, compared to the benchmark VN Index’s increase of 12.5 percent. Nam Long shares fell 1.1 percent to 17,800 dong at yesterday’s close.

“This is a turning point for the company,” said Chad Ovel, a Ho Chi Minh City-based partner at Mekong Capital, manager of the Vietnam Azalea Fund, which holds shares in Nam Long. “They believe they need to diversify, to get away from solely being a developer of one-off properties and to move toward becoming an integrated company, a developer of satellite cities.”

Urban Concept

Satellite cities are becoming an increasingly common urban development concept on the outskirts of Southeast Asian cities, such as Phnom Penh in Cambodia, the U.K.’s University of Leeds said in a 2012 paper.

The development of large-scale housing and satellite cities in areas on the periphery of the inner city is one of the major trends in housing development in Jakarta, many initiated by large developers responding to the potential of the market, Indonesia’s Ministry of Housing said in 2009.

Nam Long received a $7.5 million IFC investment this year to finance mid-income homebuyers in Ho Chi Minh City. The World Bank unit described the company as a market leader in affordable-housing developments.

Plans for Nam Long’s project in Long An include villas, townhouses, apartments, commercial, recreation and service areas, Tran said.

“The middle class, they want safety, security, a nice area, higher-end,” said Tran. “They want gated communities. A country like Vietnam, with a city like Ho Chi Minh City with over 10 million people, the demand is there. You just have to provide the right choice for the buyer.”

The company’s shares have gained about 3.5 percent this year on the Ho Chi Minh City Stock Exchange.

“Previously they were very focused on marketing their affordable housing business, which is a core business,” said Ovel. “But long term, developing and marketing the large land block they have in Long An will be critical so the story has evolved a bit.”

Please upgrade your Browser

Your browser is out-of-date. Please download one of these excellent browsers:

Chrome, Firefox, Safari, Opera or Internet Explorer.