VinaCapital, the fund manager of the London stock exchange-listed Vietnam Opportunity Fund (VOF), has decided to establish a real estate-focused investment fund to take advantage of increasing opportunities in the property market.
Launched at the Investor Conference in HCM City last week, the new fund, also known as VinaLand the second investment fund now under the management of VinaCapital in Vietnam has an initial capital size of US$50 million.
“Preparations for VinaLand’s operations are now on fast track. We expect that it will come into operation by early by 2006,” said Peter Dinning, managing director of VinaCapital Real Estate Ltd Company.
Dinning said VinaLand will invest in office, residential, serviced apartment projects, retail and hotel markets, leisure industry, resorts located around coastal land, and also industrial park development for both local and overseas manufacturing companies.
“The property market in Vietnam is poised for a period of strong growth buoyed by fast economic growth and growing inward investment. Opportunities are promising in every sector of the corporate office, residential, industrial, retail and leisure market.
“Actually, the capital scale of VinaLand [US$50 million] is quite small in comparison to the vast opportunities. We expect that the first tranche will be invested over nine to 12 months. After that time, we will raise more funds to enable us to tap opportunities as they arise,” Dinning said.
Asked by Vietnam Investment Review about VOF’s investment deals in the real estate sector which had been conducted prior to VinaLand’s launch, Dinning said they would not be transferred to VinaLand but remain under the management of VinaCapital Group.
“However, VOF has the right to invest 25% of its capital into VinaLand’s projects,” he noted.
VinaLand is the second foreign real estate fund in Vietnam after the US$42 million Indochina Land, which was established by Indochina Capital in May this year. Experts said the establishment of property funds like VinaLand and Indochina Land is an unavoidable trend as possibilities for such property-focused funds include huge demands, new Land Law as well as a lack of serious money and expertise in property development.
VinaCapital Group is a leading investment banking and fund management company with experience in the emerging Vietnamese market. The firm leverages this experience and its strategic relationships to create and deliver investment products. strategic financing and mergers and acquisitions advisory services in Vietnam.
VinaCapitaI successfully manages the VOF, a US$95 million investment fund listed on the London Stock Exchange (AIM). VOF’s investors include many of the leading institutional investors in the US, Europe, and Asia.
VinaCapitaI has also acted as the Southeast Asia office for its sister company, Pacific Alliance Group (PAG), which manages a US$100 million Pan-Asian Fund. This is the first time a Vietnam-based asset management company has assisted in managing an international fund.