Japanese Company’s Aim to be No.1 Apartment Producer in Vietnam

Updated: Jul 25, 2020

Haseko Corporation – the largest apartment construction company in Japan with around 35% market share, has joined Vietnam market for high quality apartment projects. Below is the interview of Mr. Akihiko Iwatani – Vietnam Chief Representative, by VinaForum & VnInvestors.com .

(Mr. Akihiko Iwatani – photo: VnInvestors.com )

Would you please introduce about HASEKO Corporation?

HASEKO Corporation is the construction company focusing on apartment and also have many subsidiaries doing all apartment related business such as sales, property management, renovation, etc…

We do all the business related to the apartment and provide A-Z services. We will find the location, do the proposal to the customers, the planning and design, construction, sales & property management.

We can provide the package of the services on apartment development which has made Haseko different from other construction company to our customers. And this expertise has led Haseko to the No.1 apartment construction company in Japan.

Our market share in Tokyo areas & Osaka areas is about 35%. We are the dominant in this field. we would like to do the same business in Vietnam.

Do you have any competitor in Japan that doing the same business nature?

No, not really! That’s why we have an advantage in this field. We have established the whole system and become dominant. And it becomes very hard for other companies to catch up with us in apartment construction field.

(Projects done by Haseko in Japan. Photos: Haseko Corp.)

What is HASEKO’s intention in Vietnam?

In the long term, we would like to provide the same services we have done in Japan. We would like to set up the system to provide the full package of services related to apartment development from A to Z.

In short term, we want to focus on designing and building.

As the trigger to get attention from developers, we will invest our own capital to develop apartment projects in Vietnam. We do the investment, making the concept design and construction to provide an apartment with the “taste” of Japan.

We will put our expertise into it to make the difference from other apartment projects in Vietnam. We regard the fundamental quality of building as most important factor in the apartment, and we can make the difference in this point.

Now in Vietnam, I feel many developers try to appeal their products in the aspect of the fancy facilities such as gym, swimming pool and also fancy decoration which, I believe, are not very important factors of the housing.

We also have know-how of designing efficient unit with limited ㎡ like 60-70 m2 and it might be really attractive to the customers here who have 2 kids and need more rooms but can’t afford 100m2 apartment unit.

And in this May, we became the shareholder of the local construction company - Ecoba, one of the top 10 in FAST500 in 2020. And we expect the cooperation with Ecoba will enhance our business in Vietnam.

How do you see the potential of Vietnam real estate market?

Really attractive! We can expect the strong demand in the next decade for two reasons:

Firstly, the population of Vietnam is nearly 100 million with the average age of 32 years old.

Secondly, the economy of Vietnam has rapidly grown, and we can expect this trend will keep going strongly in the future.

As Vietnamese economy growing up and attracting more foreign companies, the demand for not only housing but also offices, retail centers, factories and logistics will grow up as well. There should be strong demand for many kinds of real estate property.

Especially in the big cities like Ha Noi (HN) or Ho Chi Minh City (HCMC), many people inflow from suburbs every year for jobs, schools, etc... Many university students also want to stay back in those cities for jobs after graduation. This creates big demand for apartments in HCMC and Hanoi.

How do you compare Vietnam and other ASEAN countries like Singapore, Malaysia, Thailand, Indonesia?

I am not familiar with other ASEAN countries, but I assume that Vietnam has the competitiveness against other ASEAN countries. As I mentioned, VN have nearly 100 million people with average age 32 relatively large number compared to another ASEAN countries such as Thailand, Singapore or Malaysia. I think in general the population and average age are very important factors to forecast the future demand for housing. I also think that Vietnam is welcoming foreign investments (FDI) on Real Estate and legally easier for foreign companies to do the development.

(the 1st apartment building of Haseko in Hanoi)

Does Haseko seek to collaborate with local partners or you will do your business alone?

We would like to collaborate with local partners because of legal procedures related to real estate development which are complicated and not transparent. It’s really hard for foreign company to follow the regulations by itself. We do need very good partners who can handle the legal procedures.

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Do you have any expectation to be the leading apartment company in Vietnam like in Japan? How many years do you predict?

With good local partners, I expect about 10 years to be one of the top apartment construction companies in this market.

Currently you only focus on the apartment projects in HCMC and Ha Noi, which size is your investment in 1 project?

Up to US$ 100M total investment and we don’t care about the share of the joint venture, we can be a minor or major. It depends on the apartment sales.

To do apartment projects in Vietnam, you need to acquire land sites, project licenses, etc... Do you have any local consultant to help you?

We luckily have a very good local consultant which is SAOKHUE Investment & Trade Promotion Corporation. SAOKHUE has been helping us well for those jobs.

At the conference events of VinaForum for over 13 years, we’ve also heard many foreign companies from EU, USA, Taiwan, Korea, Singapore complaining about the incomplete legal system and the un-transparency of the regulations here. It takes a lot of time, wastes lots of resources and opportunities?

In Japan, the regulation is mostly clear, and black is black, white is white. There is little room to interpret in many ways. But in Vietnam, the regulations here are not in that way, it is very difficult to get the clear picture about each regulation.

So that’s why we need a very good partner or consultant like SAOKHUE to help. If everything is clear, Vietnamese market will become more attractive for foreign companies like us.

(caring every details of the building. Photos: Haseko Vietnam)

The coronavirus pandemic now becomes very crazy. Does it affect your business? Any delay for your plan?

Because of the very good control by Vietnamese government and quick recovery in Vietnam, also the momentum of housing demand from buyers help us overcome this tough situation.

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However, in short term, maybe this year, the sales is not really good like before, but in the next year it will bounce back quickly. And in the long term, I have no doubt about the extension of this field. For our business here, there was no change but the problem is the legal procedure of everything both in HN and HCMC which is too slow during this time. We will see how the election will be in the next year and expect, maybe in 2 years later, the procedure will be improved by the commands.

Do you have any advice for local developers / project owners to get more investments from foreign companies?

In 8 years since I came to Vietnam, the apartment project has been dramatically changed. When I came here, every project was the same, they just got 100 – 150m2 with 2 or 3 bedrooms along with swimming pool & shopping mall. And the price is really high. Now, they’ve learnt from the market and make smaller size of apartment, less than 100m2 units have been developed. More the market is matured, more they need the marketing and make the difference from competitors. And attention to the quality of their products will become the essential point too. Japanese companies would like to work together with local partners who care about the quality of their products in many aspects.

How you can get yourselves to be seen and to be connected by Vietnamese Investors on VnInvestors.com?

Do you have any advice for Vietnamese home buyers?

An apartment is a big important asset of a Vietnamese family. I know it’s hard for Vietnamese home buyers to check the quality but try your best, pay attention in fundamental, quality of the building itself. Do not focus on fancy stuffs. Don’t judge anything with the surface looking. And also looking for professional property management as well. The property management is very important, if they maintain the building carefully, it will last for a long time.

Would you please give us some information about yourself?

I’ve been living in Vietnam for 8 years and 3 months. I have been working for Haseko for more than 30 years since I graduated from university. I’ve worked in many departments such as Accounting, Financing, Sales and Strategy Planning and then I was transferred into Vietnam to set up the Representative Office in Hanoi in 2012.

How the differences between living in Vietnam and Japan?

Different culture, different language, different people… Basically, everything is different. However, the most different part is the transportation and the size of city area commuting from home to the office. In Japan, we take train, subway, bus from our home to our office and it would take around 1 hour or more. However, in Vietnam, so far you commute by motorbike, car, bicycle or some buses for around 30 minutes. Therefore, now the residential area of the city is relatively smaller and dense for residents. Maybe in the future, it will change dramatically after you start using public transportation such as subway

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You said that you have already been here for 8 years, have you experienced any challenge in living or doing business in VN?

Sometimes, we find it very difficult to negotiate a deal with a local real estate company. Because of the different business culture and practice, we get into the dead lock in the deal. Therefore, we need an experienced consultant like SAOKHUE to support and to guide us the reasons why they bring up their proposals in very difficult way for us and how we should talk to them in more comprehensive and convinced way.

How do you see the Vietnamese people?

Vietnamese people are very nice. They are very diligent to work. I feel Vietnamese enjoy their life more than us. I feel almost every Vietnamese people believe in tomorrow, they believe tomorrow will be better than today. They expect the future is brighter but in Japan, many people, even the youth do not believe that tomorrow is better than today because we experienced many natural disasters for a long time. That’s why we are very cautious!

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Khue An



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