VietNamNet Bridge – A vice chairman of the Vietnam Tourism Property Association said it is time-consuming for investors to complete all the approval procedures and development of luxury resorts in Vietnam.
A tourist takes pictures of a resort in Vietnam.
At a review meeting of the association in HCMC last week, Than Thanh Vu said it takes the investor 167 months, or almost 14 years, to complete a process from outlining the idea to putting into service a resort comprising around 300 four- to five-star rooms on 10 hectares in Vietnam.
Vu, who is also managing director of Phu Quoc Land, said this was what he had encountered in his 13 years in the tourism property development sector and that the association’s members shared his view.
Vu said it usually takes an investor around 63 months to know land rent from the time when the local government agrees to allow companies to develop a resort at a chosen location. The investor must complete 44 groups of tasks with half of them related to management and approval by administering agencies at different levels.
“The implementation process can be made faster if land is cleared and the 1/2000 or 1/500 zoning plan is available, but local authorities do not often have done this work until investors come,” Vu said.
Kenneth Atkinson, managing partner at Grant Thornton Vietnam, said in support of Vu that if investors want to develop tourism property projects in Vietnam, they will need up to three years to complete documents while this takes only a couple of months in other countries.
Duong Thanh Thuy, chairwoman of Trung Thuy Group, told the Daily that investors have to depend too much on site clearance and land rent approved by local authorities.
Thuy noted if bank interest rates are stable, a tourism property project would need 20 years to recover capital. As for a project with a 50-year lease contract granted, local authorities should ensure the land rent to be stable in at least ten years but a few localities can make it happen.
Thuy said her company had to drop a project of huge potential as local authorities decided to increase land rent by ten times after her company had signed a land lease.
Site clearance and compensation often take much time. Trung Thuy Group used to wait five years to have a location allocated for its project cleared.
“With fast procedures, ready-to-use land sites and stable land rent, we can develop our projects rapidly. However, this remains to be solved,” Thuy said.
SGT/VNN