Keangnam Hanoi Landmark Tower, the highest building in Hanoi, Vietnam, valued at $1 billion, has been reportedly put on sale; interested international investors include, Goldman Sachs and the Qatar Investment Authority (QIA).
The Korea Economic Daily cited sources, saying that both the Goldman Sachs and the QIA have made their respective offers for the acquisition of the Hanoi tower to the New York office of commercial real estate service company Colliers International, the lead manager in the sale of the 72-story building, constructed by Korean firm Keangnam Enterprises.
As part of the bid, Goldman Sachs will assume the project financing debt at some $900 million, and establish a special-purpose company to take over the building as the largest shareholder. Meanwhile, the gulf sovereign wealth fund will acquire the skyscraper at $800 million for long-term ownership.
The Landmark 72 has a recent history of trouble, related to the former head of Keangnam Enterprises, Sung Wan-jong, who committed suicide last month after a probe into secret dealings with top Korean politicians. The operating company for the Hanoi building, Keangnam Vina, has been allegedly involved in manipulating accounting books to conceal mounting debts during its construction, while the parent firm has been delisted from the local stock market. .
Despite the high possibility of contigent liabilities, the US investment bank is said to be reviewing the idea of reselling the skyscraper in the form of non-performing loan. The creditors of Keangnam Enterprises include Shinhan Bank, the Export Import Bank of Korea, Woori Bank and Nonghyup Bank.
Meanwhile, information from Vietnam shows that Landmark 72 is valued at $770 million. The parent company invested 1 trillion wons (over $1 billion) in the building, in which the bank borrowings accounted for 530 billion wons.
Previously in January, the Parkson Keangnam trading centre inside the building was temporarily closed without notice, raising lots of concern among small retailers. The culprit was a dispute between the owner of the building and Parkson Hanoi Co Ltd.
Till two weeks ago, chairman of Keangnam Vina, Lee Hyo Jong, was insisting that the Korean scandal would not affect the company’s operation in Vietnam.
Image: Flickr, Deven Hwang