KUALA LUMPUR (July 20): Gamuda Bhd’s property arm Gamuda Land has entered into an agreement to acquire a 9.1-acre site in Thu Duc City in Ho Chi Minh City (HCMC), Vietnam, for approximately US$315.8 million (RM1.47 billion).

In a filing to Bursa Malaysia on Thursday (July 20), the company said this mixed-use development site has a projected gross development value (GDV) of US$1.1 billion.

The company plans to develop 1,968 exclusive apartments, 12 penthouses, 51 podium shops and 21 shophouse units across six towers of up to 40 levels, all fully developed and sold within five years.

“Gamuda Land was able to capitalise on these two key factors in this opportunistic acquisition — to obtain a shovel-ready development site in a prime location with all requisite planning approvals in place and rapidly sell in-demand products to a market short on supply,” said Angus Liew, chairman of Gamuda Land Vietnam operations in a separate statement.

The company said the target positioning for this development will be in the "high-end" category with a pricing range of US$4,000–US$7,000 per sq m, subject to location and product quality.

New properties within this category have recorded stable absorption rates of over 75% across the past five years, according to Savills, the company added.

“There is an acute lack of supply of properties within this price range in this prime location, as most of the market supply has been in the ‘upper high-end’ category, with prices higher than US$7,000 per sq m,” said Liew.

He added as such, their product will be highly sought-after by high-income expatriate families and the growing local middle and high-income Vietnamese seeking value and proximity to the premium amenities nearby. Since 2007, Gamuda has established a strong presence and brand name in Vietnam with a proven track record of successful projects.

Given the prime location and Gamuda Land’s established brand, this project will play to the company's strengths.

This investment is part of its quick turnaround projects (QTP) strategy, which aims to complement its township development model through the deployment of capital in diversified projects with an exit
time frame of 3-5 years.

Gamuda Land has four projects in Vietnam, namely Gamuda City in Hanoi, Celadon City and Elysian in HCMC as well as Artisan Park in Binh Duong,outside of HCMC.

Gamuda shares closed two sen higher or 0.45% to RM4.47 on Thursday, valuing the group at RM11.9 billion.