VNRE - Up until now Vietnamese real estate developers used the services provided by foreign consultancy firms. This has changed recently as they need new solutions to boost their sales in the gloomy market.
Hiring foreign firms as exclusive distributors was once considered a wise move by Vietnamese real estate developers, because the cooperation was believed to help obtain best prices for their sales and help polish their the images. However, it seems that Vietnamese real estate developers have changed their mind. They have been seeking new distributors or expanding the numbers of marketing representatives or sellers., many of the new service providers are domestic enterprises.
Changing horses while crossing the stream
For a long time, the real estate market in Vietnam has been considered as the playing field of foreign firms only. A lot of foreign names have become familiar to Vietnamese, including CBRE Vietnam, Savills Vietnam, Colliers, Cushman Wakefied or Jones Lang LaSalle and Knight Frank, the providers of many services, such as investment consultancy, valuation, the agents for leasing and selling and for real estate management.
And for a long time, real estate developers believed that the cooperation with foreign firms is the way to obtain high business effects and image positioning. This also meant that there was no more room for domestic service providers in this lucrative market.
However, recently the cooperation with foreign firms has brought fewer effects than expected. In other words, the model of hiring foreign firms as exclusive distributors began to be questioned.
Vietnamese real estate experts know that for a long time Savills Vietnam has been acting as the exclusive distributor for the apartments of Indochina Plaza (IPH) project. However, recently, rivals of Savills, Knight Frank and CBRE have also been invited to organize the sale campaigns for the developer.
Meanwhile, the developer of Mulberry Lane in Ha Dong District, signs contracts for marketing and sales for certain periods only. Therefore, three or four big names have been replaced, including CBRE, Cushman Wakefied and Knight Frank. Most recently, a domestic company has been targeted by the big real estate developer.
Similarly, Cushman Wakefied, Sacomreal, CEN, CBRE all have once acted as the sellers for the apartments of Canal Park in Long Bien district. But now a completely new – domestic - nameappeared.
Vincom has recently decided to stop working with CBRE, with whom it had been cooperating for a long time. CBRE used to be the sale representative for all the projects with Vincom and Vinpearl brands. But the “couple” has not appeared together since the third quarter of the year. Vincom does not intend to seek a sale representative, planning to be in charge of sales itself.
End of monopoly
Explaining these recent changes, experts say that the lack of interest is now the biggest problem for the developers. Therefore, real estate developers are seeking a new remedy
Pham Thanh Hung, Deputy General Director of The Ky Real Estate Company (CEN), said that the data about possible clients of every seller is limited, and no seller can have everything.
Once a sale representative cannot meet the requirements set by developers in terms of sale speed and turnover, real estate developers has to replace the representatives.
Vu Cuong Quyet, Deputy General Director of Dat Xanh Company, said that the big advantage of domestic service providers is that they have good lists of potential clients in the middle class market segment who are the most likely clients.
The degrading service quality of foreign companies has also been cited as one of the reasons that has prompted developers to seek new sale representatives.
The developer of a big project in Tu Liem District complained that at first, the foreign service provider sent some good employees to the project, but after that, it transferred the case to less experienced ones. The developer said that if he had not urged the service provider, he would not have got reports about the sale everyday.
“The service quality of some providers have been decreasing. Moreover, their wrong market forecasts reduced their prestige,” said Nguyen Do Viet, Deputy Director of Song Da Thang Long Corporation.
Reported by Dung Thanh | Vietnamnet