VinaCapital, a fund manager on the London Stock Exchange listed on the Vietnam Opportunity Fund (VOF), recently received a strong response from international investors to VinaLand, its new fund dedicated to real estate opportunities in Vietnam.
The fund received over US$300 million in subscriptions, 6 times over the originally targeted US$50 million, but the final figure is being considered by VinaCapital’s management board, according to one source.
“We are immensely pleased with the overwhelming response to our new property fund. But as with the previous rounds of funding, we will possibly have to turn down a significant number of new subscribers,” said Don Lam, Managing Partner of VinaCapital. “We received subscriptions from both investors in our first fund, who have seen the demonstrated results of VinaCapital’s disciplined investment approach, as well as new investors, who believe in the real estate potential of Vietnam’s robustly growing economy.”
VinaLand will list on the London Stock Exchange’s Alternative Investment Market (AIM) on March 22, 2006, becoming the first publicly traded fund dedicated to property investments in Vietnam. VinaLand will invest in five property sectors: office, retail, residential, industrial and leisure. The fund’s primary focus will be Ho Chi Minh City, with a secondary focus on Hanoi and key leisure areas, including Nha Trang, Hoi An, and Danang.
“There is enormous latent demand for property across all sectors. The country’s economic growth has given rise to a burgeoning urban middle class with an increased amount of disposable income, putting pressure not only on middle-class residential housing but also limited retail space,” said Peter Dinning, Managing Director of VinaCapital’s real estate arm. “In addition, Vietnam’s increased international exposure is resulting in an influx of tourists, multinational corporations, and manufacturing companies looking for an alternative manufacturing hub. The result is pressure on a limited supply of hotel rooms, office space, and industrial zone space.”
“The timing is right for the launch of fund dedicated to real estate opportunities in Vietnam,” said Peter Dining. ”The economic, legal and demographic changes occurring in Vietnam are similar to those that fueled the explosive growth of China’s real estate market which began in the late 1990s. In the case of both China and Vietnam, we’re looking at the same growth factors: increased disposable income, urbanization, availability of mortgages, and a series of financial, regulatory, and legal reforms spurred by impending WTO accession.”
The launch of VinaLand tops off a series of recent accomplishments for VinaCapital, which achieved high returns for its first fund, the Vietnam Opportunity Fund (34 per cent in NAV per share; 35 per cent in share price for the year 2005) and organized Vietnam’s first international investor conference in December of last year.
VinaCapital Group (www.vinacapital.com) is a leading investment banking and fund management company with unrivalled experience in the emerging Vietnamese market. The firm leverages this experience and its strategic relationships to create and deliver investment products, strategic financing, and mergers and acquisitions services.
VinaCapital manages the Vietnam Opportunity Fund, a US$171 million closed-end fund listed on the London Stock Exchange (AIM). Since the Fund’s inception in September 2003, VOF has achieved attractive risk-adjusted returns through investments in private equity, the listed and OTC markets, privatization of state owned enterprises, and select property developments throughout Vietnam. The VOF portfolio includes industry leaders such as the Kinh Do Corporation, the largest confectionary enterprise in Vietnam, and the Sofitel Metropole Hotel in Hanoi, the elite hotel which has housed ambassadors and heads of states. LCF Rothschild named VOF the best performing fund in Vietnam in 2004 with a 25 per cent increase in Net Asset Value and a 38 per cent increase in share price. VinaCapital's overarching objective is to create and realize value for its investors and clients.
VinaCapital also acts as the South East Asia office for its sister company, Pacific Alliance Group (PAG), which manages over US$300 million in different pan-Asian funds. VinaCapital employs over 40 professionals and has offices in Ho Chi Minh City and Hanoi.
Phuong Nhi
Vietnamese
