SP Setia recieves investment certificate for new Vietnam project

KUCHING: SP Setia Bhd (SP Setia) will be the prime beneficiary of robust demand in residential units due to an expected strong growth in income amid an improved macro outlook. AmResearch Sdn Bhd (AmResearch) believed the group would be able to garner stronger pricing given that it was eyeing a more prime location site for its latest proposed development which was much closer to Ho Chi Minh city compared with Setia Eco Lakes.

It estimated that, based on an efficiency rate of 80 per cent and a plot ratio of four times, the group would be able to garner a pricing of US$65 per square feet (psf) to US$70 psf for this development. SP Setia is getting around US$40 psf for Setia Eco Lakes.

However, the research firm expressed concern on the take-up rate given the slow moving rate of its maiden project in Setia Eco Lakes, although it is about 90 per cent presently. It believed it would take a while for the group to penetrate the immature middle-class population.

To recap, Setia on Thursday announced that Binh Duong Province had issued an investment certificate to Setia Lai Thieu One Member company. Construction on this development, nonetheless, will not begin until a construction permit has been granted. All necessary approvals should be obtained within 12 months, the research firm pointed out.

The development was to take place on a piece of land measuring 27 acres, located in Lai Thieu town, Thuan An district within Binh Duong province. The land is located about 16 kilometres north of Ho Chi Minh city, less than an hour’s drive away from the Tan Son Nhat international airport. AmResearch also highlighted the 27 acre project was to be developed within six years and held a gross development value of circa US$250 million, comprising 1,700 units of shop houses, terrace houses, semi-detached houses, commercial centres, a clubhouse and apartments.

The group did not expect too much from its Vietnam ventures only targeting RM100 million sales for this year, or only a mere five per cent from its total sales target of RM2 billion.