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Gov’t seeks to reclaim empty ’golden land’ plot

Update: May, 17/2018 - 10:28
A site map of Lavenue Crown project, with investment from the Lavenue Investment JSC, in HCM City’s District 1. The Government Inspectorate has demanded the Government reclaim the land plot and put it up for auction. Photo realestatevietnam.com.vn
Viet Nam News

HCM CITY — The Government Inspectorate is seeking approval from the Prime Minister to reclaim and auction a plot on so-called “golden land” on Lê Duẩn Street in HCM City’s District 1 downtown area.

Covering ​​4,896 sq metres, the state-owned land plot managed by the City Housing Business Management Company was initially rented by four state-owned companies under the Ministry of Industry and Trade to build office buildings.

In 2010, as proposed by the Ministry of Industry and Trade, the city’s People’s Committee agreed to establish the Lavenue Investment Joint-Stock Company with the participation of the four aforesaid state-owned companies and the City Housing Business Management Company.

In June 2011, the city People’s Committee approved the land-use rights for the Lavenue Investment Joint Stock Company to build a complex which contains luxury apartments, five-star hotels and a shopping mall, with a term period of 50 years. Under this plan, the state collected land-use fees and leased the land for annual rental payments.

In 2016, the Government Inspectorate issued report No.138 in which it said the city government had made a “mistake” by not auctioning the land-use right.

But the city government said it had been too difficult to reclaim the land as the investor in June 2016 had fully paid the land-use fee and land rental of VNĐ700 billion (US$30.73 million) to the state.

The plot has a prime location, with three sides adjacent to major downtown streets namely Lê Duẩn, Hai Bà Trưng and Nguyễn Văn Chiêm, and close to Reunification Palace and Notre Dame Cathedral.

The Government Inspectorate said the lease for the land plot should be much higher than the price proposed by the city’s Department of Finance and approved by the city’s People’s Committee.

With the current market price on Lê Duẩn Street which is estimated at around VNĐ400 million ($17,565) per sq m of land, the state would collect more than VNĐ2 trillion ($87.82 million), instead of VNĐ700 billion, if it was auctioned, according to the inspectorate.

Nothing has ever been built on the land plot, and the land is now being used for parking, according to the inspectorate.

Violations by the city

According to the conclusions reached by the Government Inspectorate, the city People’s Committee should not have approved the investors, who had weak financial capacity, without consulting specialised agencies.

This approval led to a reduction in revenue for the State budget, as well as a drop in the proportion of state capital contributions, from 50 per cent to 20 per cent, it said.

“The violations of the city People’s Committee and concerned agencies and businesses are signs of deliberate violations of State regulations, which should be punished seriously,” according to the inspectorate.

The inspectorate also pointed out that the HCM City People’s Committee must be held “generally responsible”, while Nguyễn Thành Tài, former vice-chairman of the municipal Committee during his 2011-2015 term, should be held “personally responsible”.  

The former vice-chairman allegedly signed and approved investors without sufficient capability to participate in the project, causing loss of State budget revenue, reducing the state capital contributions, the inspectorate said in its report.

In addition, the departments of Planning and Investment, Natural Resources and Environment, Finance, Planning and Architecture, as well as the City Housing Business Management Ltd Company and the four companies under the Ministry of Industry and Trade must also be held responsible, the inspectorate said.

With the design of a lotus tower, the proposed 36-storey Lavenue Crown tower complex was to be located next to Diamond Plaza Mall at the corner of Duẩn and Hai Bà Trưng streets.

However, for many years, the land plot has remained empty and has been used as a parking lot.

This is one of the most important cases related to HCM City authorities’ mismanagement of public land. In the 2016-17 period, the city’s inspectorate discovered 103 cases of mismanagement of public land and houses in the city. — VNS 

 

 

 

 

 

The HCM City government was found to have not auctioned land-use rights for the plot with a prime location - three sides adjacent to major downtown streets, namely Lê Duẩn, Hai Bà Trưng and Nguyễn Văn Chiêm, and close to Reunification Palace and Notre Dame Cathedral. — Photo zing.vn

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