Vietnamese Developer Tan Hoang Minh cancels purchase of HCMC’s most expensive land lot

Construction News Vietnam
Thu Thiem Peninsula in HCMC’s District 2 in May 2021. Photo by VnExpress/Quynh Tran

Vietnamese Developer Tan Hoang Minh cancels purchase of HCMC’s most expensive land lot

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A property developer who successfully bid to buy a land lot in HCMC at VND2.45 billion ($108,000) per square meter last month has decided to pull out.

Tan Hoang Minh would not go ahead with the purchase of a 10,060-square-meter lot in the Thu Thiem Peninsula, a spokesperson for the Hanoi-based company told VnExpress after it informed top government leaders.

It means the company will forfeit its deposit of over VND588 billion.

Company chairman Do Anh Dung said in a letter to them that the decision was made after considering how the price tag could lead to “negative consequences” for the real estate market.

It acknowledges a comment by Minister of Finance Ho Duc Phoc on January 4 that the price tag was “unusual,” the letter said.

“We have carefully reviewed our decision and come to the conclusion that the auction-winning price would cause disruptions in the economy and real estate industry”.

But HCMC’s Property Auction Service Center said Tuesday evening it had not heard from Tan Hoang Minh about canceling the purchase.

Thu Thiem peninsula houses many villas and buildings, October 2021. Photo by VnExpress/Quynh Tran

Land lot 3-12 was sold at VND24.5 trillion, 8.3 times the reserve price, on December 10 and the unprecedented price in Vietnam’s real estate industry quickly became a sensation.

Dung had said he did not want a foreign developer, Capital One Financial, to buy it, and it took 70 bids before the land was sold.

It will now return to the auction center.

Thu Thiem New Urban Area in the namesake peninsula is a 657 hectares (1,623 acres) megaproject to develop the city into an international financial hub, located on its namesake peninsula in the south-east of HCMC.

In June 2015 Tan Hoang Minh had won an auction for a 3,000-square-meter land lot at 23 Le Duan, District 1, for VND1.43 trillion, 2.6 times the reserve price.

It then canceled the purchase saying that the auctioneer had made mistakes in the incremental bid rates.

In June 2016, the company asked to buy the land again and paid a fine of VND260 billion on top of the winning price.

It sold the land to private lender Techcombank in 2019.