Bridging Cross-Border Capital and Synergy to Vietnam and APAC

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About

VPAC Capital is a cross-border investment consulting and management company, focusing on providing services to high-net-worth clients and institutions, and seeking investment opportunities in Vietnam. The scope of investment consulting includes real estate, private equity, and listed assets, as well as asset management and exit strategies.

The core team has rich experience in private equity and real estate investment management, with international experience covering the Asia-Pacific market.
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VPAC Capital has local market knowledge, practical experience, and profitable exits, as well as a history of collaboration with listed companies in Vietnam. It provides overseas investors with a safe, simple, and low-threshold investment method for the thriving real estate market opportunities and risks in Vietnam.

Headquartered in Shanghai, with branch offices in Taipei, Taiwan, and Hanoi, Vietnam.

Opportunity

High-speed GDP growth & trade surplus

  • GDP growth: With the recovery of exports, loose domestic policies, and the revival of the service and tourism industries, Vietnam's economy is expected to resume growth in the second half of this year, with an annual growth rate of about 4.7%, ranking second in Southeast Asia.
  • Trade surplus: Vietnam has signed seven free trade agreements, including ECFA (ASEAN Ten Countries + China, Australia, Japan, and South Korea) and EVFTA (European Union), benefiting from the US-China trade war. In the first half of 2023, the trade surplus reached $12.25 billion, with exports down 12.1% and imports down 18.2%, in line with global economic fluctuations and representing integration with world trade.
  • FDI actively introduced: In the first half of the year, foreign investment exceeded $13.4 billion, with actual execution reaching $10.02 billion, a growth of 0.5%. Although the growth rate is small, it is still positive, ranking among the top 20 globally, and the trend of supply chain transfer shows no signs of slowing down.

Abundant labor force & consumption upgrade

  • Population dividend: Vietnam has abundant and young labor force (total population of 100 million, average age of 31.5; 51.7 million labor force aged 15 and above), enjoying the population dividend, which is one of the key factors driving the success of the industrial and service sectors, and also providing sufficient domestic demand market.
  • The rise of the middle-class consumer group: By 2022, the per capita GDP reached $4,100 (China reached this level in 2008), significantly increasing the demand for housing, cars, and other bulk commodities. By 2030, the middle-class consumer group will reach 37 million.

Accelerated Infrastructure Development & Urbanization

  • Accelerated infrastructure development: The government is speeding up the construction of transportation between cities and will invest $30 billion in transportation infrastructure from 2022 to 2025. The metro layouts in Ho Chi Minh City and Hanoi will also be opened (Hanoi Line 2A is scheduled to open in November 2022; Ho Chi Minh City Line 1 and Hanoi Line 3 are expected to open this year), providing convenience to the suburbs and increasing the value of real estate.
  • Urban housing demand: Urbanization reached 38% in 2022, lagging behind China by 20 years (China at 65%, US at 83%). The government plans to increase it to 45% by 2030, representing an annual increase of over one million new urban residents, or an annual increase of approximately 70 million square meters of urban housing demand. However, the number of approved new listed residential projects is clearly insufficient. Vietnamese people, like most Asians, are enthusiastic about owning land and investing in real estate, with frequent transactions.

Investment Strategy

  • Focus on investments related to real estate rights in Vietnam, with investment periods ranging from 3 to 5 years and expected IRR (Internal Rate of Return) of 10-15%.
  • Establish diverse local partners in Vietnam, including high-quality listed companies. At the same time, develop local high-quality service providers for each investment project to add value to the investment projects and avoid information silos.
  • Emphasize practice and optimize dynamic adjustments, the first round of GP investment and safe exit have been completed (2021), and cooperation with a listed real estate company in Vietnam on the Hanoi apartment project has exceeded the estimated return rate. And successfully completed the subsequent second round of fundraising, with ongoing exits.

Investment Types

  • Mainly invest in residential properties in Hanoi and Ho Chi Minh City, the two major metropolitan areas; gradually expand to focus on real estate investment opportunities in other surrounding industrial cities.
  • Investment in commercial housing, covering low-priced affordable housing, high-end apartments and lofts developed by local and foreign leading developers, and apartments.
  • A small portion of development investment projects, focusing on short-term participation in large development projects/sales projects (3-12 months), with expected high short-term returns on investment (IRR).

Core Team

Conrad Hung

Founding Managing Partner

Alex Lin

Partner - Shanghai/Taiwan

Davisson Wu

Partner - Shanghai/Taiwan

2021-2023 VPAC Capital. All rights reserved.