Ho Chi Minh City supports Lotte to resume Eco-smart City project in Thu Thiem

Ho Chi Minh City supports Lotte to resume Eco-smart City project in Thu Thiem

Ho Chi Minh City People’s Committee will propose the Prime Minister Nguyen Xuan Phuc to allow South Korea’s Lotte Group to continue executing its Eco-smart City project located in Thu Thiem Peninsula in District 2.
18:30, 20/09/2019
A view of Thu Thiem Peninsula in HCMC’s District 2. The municipal government supports Lotte’s efforts to resume its project in Thu Thiem. (Photo: Thanh Hoa)

The committee’s Deputy Chairman Vo Van Hoan had met with Lotte leaders to discuss the project’s execution once it is approved for resumption, Thanh Nien Online newspaper reported.

On September 9 at a reception with An Homyung, deputy general director of Lotte Asset Development, Lotte Group's arm in charge of this project, Hoan said that the city welcomes and would create favourable conditions for Lotte Group to continue its projects functional area 2a, which can become a landmark of the Thu Thiem penisula and the entire city as a whole.

Hoan also assigned the city's Department for Planning and Investment to work with Thu Thiem New Urban Area’s Management Board, related bodies, and Lotte Group to finish the necessary procedures and compile dossiers to send to the prime minister for approval.

In July 2017, four Lotte members and Ho Chi Minh City People’s Committee signed a contracton the construction of Eco-smart City with the initial investment capital of $884.4 million, after seven years of proposals.

The project, however, was halted temporarily after the Thu Thiem scandal over irregularities in granting land to investors.

At the September 9 reception, both Lotte Group and the city authorities have expressed willingness to finish all procedures to seek the PM's approval Minister for this large-scale project.

In 2018, Ho Chi Minh City People’s Committee asked for the PM's permission to scale down Lotte’s Eco-smart City from 10 to six land plots, citing difficulties in site clearance and compensation as grounds.

Lotte Eco-smart City will be built in Function Area 2A of Thu Thiem New Urban Area. (Photo: Le Toan)

Previously, local authorities proposed to handing over 10 lots to Lotte Group to implement the first-ever Eco-smart City at a cost of $2.1 billion, in Functional Area 2A of Thu Thiem New Urban Area but the investment was later downgraded to US$900 million. The other four lots are still facing difficulties in land clearance and compensation and are now occupied by churches or are held up by compensation conflicts. The project was also redesigned to cover some five hectares of land.

The joint venture consists of Lotte Asset Development, Lotte Shopping, Lotte Hotel, and Lotte Engineering and Construction (Lotte E&C). The Eco-smart City is expected to use IT in its management and operations in order to better the lives of residents.

Lotte Group currently boasts two large-scale hospitality assets in Vietnam, Lotte Centre Hanoi and Lotte Legend Hotel Saigon, both of which are producing high profits.

As the latest development, Lotte E&C signed a business co-operation contract with domestic Hung Loc Phat Corporation to set up a residential project in District 7 of Ho Chi Minh City. Previously, Lotte E&C signed a strategic co-operation deal with Phu Cuong Group to set up housing projects in Vietnam in the near future.

Lotte sees Vietnam as one of its major markets. The group has been planning to pay around $44 billion for Vietnamese and Indonesian developments over the next five years, as well as open chemical factories in South Korea, Indonesia, and the United States. The group is also paying attention to startup entrepreneurs in Vietnam and plans to set up a fund for the market as soon as it is feasible.

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