The purchase consideration will be funded by internally generated funds 

By ANIS HAZIM / Source gamuda.com

GAMUDA Bhd has acquired 13.8 acres (5.6ha) residential plot of land in Binh Duong New City in Vietnam, for US$53.88 million (RM224.68 million) as part of its expansion plan in the country. 

In filing to the bourse recently, Gamuda said its wholly owned foreign sub-subsidiary in Vietnam, Gamuda Land HCMC Joint Stock Co continued its strong growth trajectory in Vietnam with the strategic Binh Duong acquisition last Friday. 

“The UG5.6 land is part of a 2,600- acre integrated township set to be the administrative centre of the nation’s affluent Binh Duong Province in Vietnam,” Gamuda said. 

The purchase consideration will be funded by internally generated funds. 

Gamuda has planned to build 349 units of landed properties targeted at the local market through the acquisition. 

It also remains committed to deepening its presence in the Vietnamese market, which presents an attractive proposition to inter- national developers thanks to strong fundamentals. 

“These include consistent GDP growth of 6% to 7% in recent years, a population of more than 104 million by 2030, high yields for property investments and relatively affordable land prices, as well as the introduction of conducive foreign ownership regulations in 2015,” it stated. 

Moreover, the Binh Duong acquisition is in line with Gamuda’s emphasis on international projects in its portfolio, which accounted for two-thirds of its property sales in the financial year 2021. 

“This strategy has seen the group through the challenging economic outlook of recent quarters, providing stable lines of revenue amid weaker sentiment and currency fluctuations in the domestic market,” it added. 

The project development on the UG5.6 land is set to be market- driven as it is sited in Le Hoan Street in the heart of Binh Duong New City, with proximity to the upcoming World Trade Centre. “It’s catering for the township’s growing residential and commercial demographics with a mix of townhouses and shophouses giving homeowners the flexibility to conduct business on-premise,” it noted.

It will also leverage the presence of numerous educational institutes nearby, including The Vietnamese-German University and Singapore International School, as pull factors for family households and a high-quality workforce. 

“Binh Duong New City’s 185- acre Central Park also serves to drive footfall in the vicinity, while accessibility to major routes such as Ring Road 4, the My Phuoc-Tan Van Highway, upcoming mass rapid transit and bus rapid transit networks and planned North-South Railway facilitates travel to destinations across southeast and southwest Vietnam, including Ho Chi Minh City by 32km away,” it further said. 

With a gross development value of US$117 million, the Binh Duong acquisition is set to contribute to the earnings of the group. 

Barring unforeseen circumstances, Gamuda said that the acquisition is expected to be completed by the third quarter of 2022.