KepLand tunnels deeper into Vietnam with third township

Keppel Land’s latest residential township project is located in Ho Chi Minh City’s prime District 2 site.

The waterfront residential project was done through Keppel Land’s wholly owned Flemmington Investments Pte Ltd through a joint venture with local developers, Tien Phuoc Co., Ltd (Tien Phuoc) and Tran Thai Co., Ltd (Tran Thai).

Keppel Land International Limited‘s Executive Director and CEO Ang Wee Gee said that Keppel is targeting the growing middle-class group who were becoming more discerning in their choice of residences and the location of their businesses. The new township would aim to develop a desirable live-work-play environment for these residents.

The site is located at South Rach Chiec in District 2 and is Keppel Land’s third township in Vietnam. It is also the second collaboration between Keppel Land and Tien Phuoc, the first being The Estella, a 1,393-unit condominium development also in District 2.

Flemmington Investments’ 42% stake in the project amounts to US$16.0 million (approximately S$22.3 million) of the total registered capital of US$38 million (approximately S$53.2 million), while local partners Tien Phuoc and Tran Thai hold the remaining 38% and 20% respectively.

This is a pilot programme which will be developed in phases. The developer will build and transfer to the city a social housing project of about 1,800 apartments. In return, the city will assign to the developer a 30-ha cleared site, zoned for waterfront development.

The waterfront township is envisioned to be sustainable and a vibrant community comprising about 4,700 homes and with a potential gross floor area of about 1 million sm. The first phase of the development is expected to be launched in 2011.

The prime cleared site in South Rach Chiec has more than two km of river frontage and is just eight km from the Central Business District (CBD). Travelling time to the CBD will be reduced to less than 15 minutes upon completion of the Thu Thiem Tunnel, East-West Highway and HCMC-Long Thanh Expressway - which are all currently under construction - over the next two years.

Meanwhile, Keppel Land’s waterfront villa development, Riviera Cove has received positive response. About 80% of 60 select launched villas were taken up within a month of the Cove’s launch in mid-November 2009, at an average selling price of about US$680,000 per unit. The remaining units will be launched in the first quarter of 2010.

Comprising a total of 96 villas in District 9, Riviera Cove is Keppel Land’s second villa project in HCMC. The first, Villa Riviera, located in District 2, saw all 101 units sold within a year of its launch in 2006.

The above transaction is not expected to have any significant impact on the net tangible asset per share or earnings per share of Keppel Land for the financial year ending 31 December 2010.