Entering the real estate market not long ago, with its 40-year experience in construction and building materials along with its decent business philosophy, Phu Dong Real Estate Group Joint Stock Company (Phu Dong Group) has quickly become a prestigious brand in the market. Vietnam Business Forum Magazine has an interview with Mr. Ngo Quang Phuc, General Director of Phu Dong Group, on the company’s development strategy. Quoc Hung reports.
Could you please tell us about the company’s foundation and development?
Phu Dong Group, established in 2011, has 14 member companies and associates engaged in five core areas: construction, building materials, real estate, education, and tourism, placed under consistent administration to achieve strategic goals set by its management.
Among our 14 member companies and associates, some have built a solid foundation with their rich experience in construction and building material production. Particularly, Vietnam Agricultural Construction Joint Stock Corporation (VINACCO), based in Hanoi, has 40 years of operation. The formerly State-owned enterprise is currently controlled by Phu Dong Group, with over 70% stake. In the south, Construction and Building Materials Joint Stock Company (CBM), situated in Ho Chi Minh City, has 39 years of experience in construction and construction materials. These units have been construction contractors and supplied construction materials for many high-rise buildings and large urban areas throughout the country.
So, Phu Dong Group is now a profoundly experienced multi-business corporation, especially in construction and building materials. What about real estate business?
Luckily inheriting values of human resources and experience in construction and building materials, Phu Dong Group has strengths and advantages to develop real estate business. Therefore, immediately after being established in 2011, we quickly mustered member companies and affiliates to form a group of consistent governance strategy and create our own land fund for potential real estate projects in two major markets of Ho Chi Minh City and Binh Duong province.
In Binh Duong province, since 2015, we built the 5.2-ha Him Lam Phu Dong Residential Area Project, including 105 commercial townhouses, 102 garden townhouses and 400 high-class apartments. The residence is the first product and the company encountered certain difficulties. But, with our dedication and strengths, this project has created a modern, livable residence that has been praised by residents and local authorities. We are proud to give a decent and civilized project to Binh Duong.
Exploring Him Lam Phu Dong Residential Area and Phu Dong Premier projects we can see that these are well-invested projects, including many utilities made by Phu Dong Group in a self-contained model. How is it significant to the business and the society?
With five core business areas at present, it is impossible to create a closed business circle, but our multi-business and multi-sector strategy that we chose is complementary, helping the company take initiative and generate benefits in carrying out investment projects. This strategy has helped us control inputs and ensure good quality, competitive price of outputs to be beneficial to customers and society.
As for Him Lam Phu Dong Residential Area, although the total land area of the project is not really big, it was systematically approved by authorities. We decided to allocate the land for schools and utilities for residents.
We have been asked why we do not sell the land and let others invest themselves? We find that selling land can bring back a lot of money, but looking further, it will be a social failure because our resident’s offspring will have to pay higher education costs. By constructing on our own, they will have a spacious and convenient learning environment while tuitions are only 50% of the average.
We are not ambitious to develop education into a system. Our goal is to serve residents in our investment projects and this actually proves this respectable direction.
Eight years is definitely not long for a real estate business, but Phu Dong Group has done a lot of socialistic and humanistic things. So, what other factors make this achievement apart from experience background?
Despite being a fledgling real estate business, we have a team of experienced leaders. Many of our executives have over 40 years of experience in construction, construction materials and real estate. The youthfulness combined with experienced personnel help us move faster and reduce risks. But, if that is not enough, the more important thing is the spirit of the leadership, so fierce but very kind.
That decency is reflected by the company’s philosophy of not seeking only profit but ensuring benefits for the community and customers and especially never accepting any tradeoff for these values. Kindness is also expressed by employee devotion, dedication to partners, to employees and to authorities. Kindness must also be illustrated through consistent commitment to customers. All in all, Phu Dong Group has gradually gained trust. We will constantly strive to become a trusted brand of society.
What are future strategies and goals of Phu Dong Group after its achievements?
In addition to construction, we see real estate as one of our two core business lines and we will muster financial and land resources to develop more projects in the coming time in the two key markets of Ho Chi Minh City and Binh Duong. And 80% of resources will be prioritized to develop real estate projects of high customer needs, particularly properties worth less than VND2 billion much sought by young families. The remaining 20% will be focused on higher-end products. With that strategy, we wish to find a suitable land fund for our business strategy to develop housing supply for young people and real end-buyers, help supply and stabilize the market. Moreover, if we have the opportunity to participate in social housing development, we are also very willing. Surely, we will do this well.
Coming to Binh Duong in the context of the Fourth Industrial Revolution and Binh Duong province seeking to build a smart city, what is Phu Dong Group interested in?
We have researched socioeconomic development orientations of Binh Duong province. We realize that Binh Duong leaders have been very sensitive and humane when they aim to build Binh Duong into not only an industrial center, but also a civilized, modern, livable city.
As an investor, we will always support and follow that orientation and, in the inevitable trend of the Fourth Industrial Revolution, we will further invest in well-planned real estate projects of high quality, rich utilities and modern tech integration to catch the trend of time, the development orientation of the province and the tastes of the people, especially young consumers seeking houses worth below VND2 billion.
|For Binh Duong province, Phu Dong Group’s real estate products of real value and modern technology have brought great social values, blown a new wind to the market, and changed thinking of local property investors in the context of the Industrial Revolution 4.0 and the smart city construction policy of the province.|
How has Phu Dong Group had well-located projects (adjacent to Ho Chi Minh City) equipped with high-end standards and modern technology, but priced at less than VND2 billion?
We have been asked this question again and again. Why could we dare to build advanced houses sold for less than VND2 billion? I affirm that construction quality and technological equipment in our projects such as Him Lam Phu Dong and Phu Dong Premier are not inferior to any high-end projects in Ho Chi Minh City although its price is that low. If a project like Phu Dong Premier is located in Ho Chi Minh City, its selling price must be VND35 - 40 million per square meter. But, it will be offered at only VND25 - 27 million because it is located in Binh Duong province, although it lies close to Ho Chi Minh City. Besides, we have long-term experience in construction and building materials and we have many solutions to reduce costs, so our prices are lower.
Our Him Lam Phu Dong Residential Area Project is the clearest proof for this. With just VND2 billion, people can live in a 5.2-ha synchronous, convenient and secure residence equipped with 24/24 surveillance cameras, free wifi coverage, and smarthome applications. All these make Him Lam Phu Dong a livable place where dwellers are proud of. Our goal is our products, in the end, must always be better, more modern and worthier of living than previous products.
Thank you very much!