Khang Dien (KDH) Sets Up VND 2.5T Subsidiary for HCMC Urban Renewal Project

Overview

Khang Dien House (KDH) has approved the establishment of a wholly-owned subsidiary with charter capital of VND 2,500 billion to implement the Ma Lang and Cho Ga - Gao urban renovation project in Ho Chi Minh City. The project, with a preliminary total investment of nearly VND 16,369.5 billion, will be executed under a Build-Transfer (BT) contract. This move underscores KDH’s expansion into large-scale urban renewal in prime HCMC districts.

Key Facts

• KDH approved the establishment of Công ty TNHH MTV Đầu tư Khang Phúc An, a 100%-owned subsidiary with charter capital of VND 2,500 billion.
• The project covers two areas: Khu Mả Lạng (37,740.5 m²) and Khu Chợ Gà - Gạo (4,350 m²), totaling 42,090.5 m².
• Preliminary total investment is VND 16,369.5 billion, with VND 10,734.7 billion to be paid via land funds and VND 5,634.8 billion from the city budget if needed.
• Construction is scheduled from 2026 to 2029, with groundbreaking in Q3/2026 and completion in Q4/2028.
• The project includes social housing: a 38-story building with 1,400 apartments in Mả Lạng and a 35-story building with 760 apartments in Chợ Gà - Gạo.
• The contract term is 5 years from the effective date.

What Happened

Khang Dien House (KDH), listed on HOSE, has passed a resolution to establish a new subsidiary dedicated to the Ma Lang and Cho Ga - Gao urban renovation project. The subsidiary, named Công ty TNHH MTV Đầu tư Khang Phúc An, will have charter capital of VND 2,500 billion and be fully owned by KDH. The company will be headquartered in Saigon Centre, District 1, HCMC.

The project will be implemented under a Public-Private Partnership (PPP) model with a Build-Transfer (BT) contract. Payment will be made through land funds (approximately VND 10,734.7 billion) and, if necessary, city budget funds (approximately VND 5,634.8 billion). The project involves urban renovation, including technical and social infrastructure, and the construction of resettlement housing, with a total land area of 42,090.5 m². The timeline runs from 2026 to 2029, with construction starting in Q3/2026 and handover in 2029.

Market Context

KDH closed at VND 17,700 on August 18, 2026, reflecting a stable performance amid a recovering real estate market. The company’s focus on urban development projects in HCMC aligns with government efforts to boost housing supply and urban renewal. This project, located in central districts (Cầu Ông Lãnh and Bến Thành), is expected to enhance KDH’s land bank and long-term revenue potential, though execution risks remain given the scale and PPP structure.

Strategic Significance

This project marks a significant step for KDH in participating in large-scale urban renewal under the PPP model, which could diversify its revenue streams beyond traditional residential development. The inclusion of social housing components aligns with state policies to increase affordable housing supply, potentially easing approval processes. However, the reliance on land fund payments and city budget contributions introduces execution and payment risks. Successful delivery could strengthen KDH’s position as a key player in HCMC’s urban development, while delays or cost overruns could strain financial resources.

What to Watch

• Approval and execution of the BT contract with HCMC authorities.
• Progress on land clearance and site handover for the Mả Lạng and Chợ Gà - Gạo areas.
• KDH’s ability to raise the VND 2,500 billion charter capital and any additional funding needs.
• Quarterly updates on project timeline adherence, especially the Q3/2026 groundbreaking.
• Regulatory changes affecting PPP projects and land fund payments in Vietnam.