Da Nang removes obstacles for condotels, promotes

Change of use

Da Nang is one of the localities that developed the condotel model the earliest. Currently, the locality has 5 large-scale condotel projects with thousands of apartments, including: CT1 & CT2, CT3 & CT7 towers - Da Nang Times Square project; Riverview Complex Da Nang hotel and commercial center complex; Anh Duong Soleil complex; The Empire luxury resort and housing (Cocobay, Naman Garden). In previous years, when condotel projects encountered difficulties in granting apartment ownership certificates (pink books), the condotel market in Da Nang and neighboring areas was "frozen".

Recently, the People's Committee of Da Nang City decided to allow Kim Long Nam Joint Stock Company to change the land use purpose for the condotel construction lots CT1, CT2, CT3, CT7 at the Da Nang Times Square Project. Accordingly, the investor is allowed to change the land use purpose for 3,988m2 of commercial service land of the above 4 lots to use for urban residential purposes, used to build apartments.

Da Nang is one of the earliest localities to develop condotels.

This is the next condotel project that Da Nang has agreed to convert from condotel to apartment. Previously, in February 2020, the City People's Committee also issued Notice No. 09/TB-UBND conveying the conclusion of the City People's Committee leaders, agreeing with the proposal of the Department of Construction regarding the conversion of the function of the Vincom Riverview Complex Project (Southeast of Han River Bridge, Son Tra District) from

condotel to apartment. This project came into operation in 2018 with 864 condotel units, then the investor petitioned the City for permission to change the function.

In addition to the above projects, the city has removed obstacles in implementing other condotel projects, especially adjusting the planning in the direction of converting a part of the condotels at The Empire Resort and Luxury Housing project (west of Truong Sa Street, Hoa Hai Ward, Ngu Hanh Son District) invested by Thanh Do Investment, Development and Construction Joint Stock Company into apartments, increasing the total number of apartments in this project to 700 with a total floor area of 38,890m2.

This move by the Da Nang City government is considered as “untying the knot” for condotel projects. Currently, the city is preparing to issue pink books for tourist accommodation, including

condotel. According to Vice Chairman of Son Tra District People's Committee Nguyen Hoang Viet, after the Da Nang Times Square project changed its land use purpose from condotel to apartment, it is likely that no more condotel project investors in the district will convert to apartment. "This is to remove difficulties and obstacles for investors as well as the implementation of projects," said Mr. Nguyen Hoang Viet.

Still many concerns

According to the investigation from localities, departments and branches of Da Nang City, the Government's issuance of Decree No. 10/2023/ND-CP dated April 3, 2023 on amending and supplementing a number of articles of the decrees guiding the implementation of the Land Law, effective from May 20, 2023, will remove difficulties and obstacles for the implementation of condotel projects, especially the issuance of pink books for types of tourist accommodation such as: condotel, office apartments combined with accommodation, hotels...

However, according to the Department of Land Management of Da Nang City, the law on land and investment stipulates that the land use term for construction works used for tourist accommodation purposes (condotel, officetel, tourist villas...) is determined to be 50 years from the date the investor is decided to allocate land, lease land, or change the land use purpose (in case the investor is late in receiving the land, the operation term of the investment project is calculated from the date of land handover on site).

But in reality, for construction works used for tourist accommodation purposes, the investment preparation phase is often long, in some cases from the time of land allocation to the time of acceptance and putting the project into use, it lasts from 5 to 7 years. In particular, in some cases, when receiving the transfer of land use rights to implement an investment project, the remaining time of use is only 35 to 40 years because 10 to 15 years have been lost.

If the construction works used for accommodation purposes are granted pink books according to the land use term, many projects only have a remaining usage period of about 40 years, or even less than 40 years. If the usage period is granted short, the product (apartment) cannot meet the requirements and needs of the buyer, leading to the product consumption being affected.

Therefore, the Department of Land Management of Da Nang City requested the Ministry of Natural Resources and Environment to provide further guidance on the term of use granted to buyers of tourist accommodation apartments. At the same time, it is proposed to remove this obstacle in the direction of not granting the term of use of construction works used for tourist accommodation purposes according to the land use term, but granting according to the term of use of the works calculated from the time the works are put into use, in order to ensure the rights of buyers, as well as increase socio-economic efficiency and unlock resources, remove difficulties, and promote the real estate market.

Mr. Pham Nam Son - Director of the Department of Natural Resources and Environment of Da Nang City said that currently, the Department of Natural Resources and Environment has requested the Department of Land Management and its affiliated units to continue reporting and explaining specific cases of problems and difficulties in the implementation of land law regulations (including problems in granting pink books for condotels, officetels, tourist villas, etc.). On that basis, the Department of Natural Resources and Environment will report to the Department of Land as well as the Ministry of Natural Resources and Environment to continue to resolve in the coming time in order to unblock resources, promote the real estate market, and develop the economy - society.

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