Sun, Sep 22, 2013 - Page 14 News List

Runaway US developer leaves anger behind in Vietnam

Instead of bringing housing to the masses, the property boom drew in speculators and inexperienced developers, leaving ordinary buyers in debt with half-finished houses when the bubble burst

By Chris Brummit  /  AP, HANOI

Chi, a US citizen of Vietnamese descent, was well known in business and investment circles in Hanoi and Ho Chi Minh City before his abrupt departure last year. One real-estate agent who knew him said Chi, who is 49 according to his business license, was in insurance before starting his property business.

The Associated Press made several efforts to speak to Chi using numbers linked to the California address he used when applying for his business license in Vietnam and via family and former colleagues. All were unsuccessful. The company he formed, Minh Viet, appeared to have little trouble attracting investors when the Hanoi project launched in mid-2009. It touted three “ultramodern” 44-story towers housing 734 units and a handover date of late 2011. They were to be put up on the western outskirts of Hanoi, a district promoted by the government as a new commercial and residential hub. Minh Viet later marketed and took deposits for a second project overlooking Halong Bay, a tourist destination in northern Vietnam. Construction never began there.

WELL-KNOWN PARTNER

Those who had doubts about Chi’s reliability took heart from his well-known foreign partner. He acquired the Vietnam franchise for Coldwell Banker, and used the US realtor’s branding extensively in his projects. Coldwell Banker said it had terminated its deal with Chi last year and declined further comment, citing the police investigation into him.

One overseas Vietnamese investor said she trusted the Halong Bay project because of the Coldwell Banker name. She said she also assumed it had the backing of the Vietnamese government, citing the advertisements that appeared in the state-run media. She said that Chi appeared on a video call with his sales teams to close the deal.

“I trusted it because of Coldwell Banker’s fame, but now they are washing their hands of the project, just the same as the Vietnamese government is doing,” said the investor, who gave a single name of Ngoc.

On the slick Web site promoting the properties, Chi kept up the hard sell even as construction faltered and disputes between Minh Viet and the Vietnamese construction company, Coteccons, emerged. Media reports say Minh Viet owes the company US$7.5 million. It declined comment.

Nguyen Ngoc Tuan, a 37-year-old engineer, said he paid US$180,000 to Minh Viet, US$80,000 from savings and the rest a bank loan from a local lender. He used the contract signed with Minh Viet as collateral for the loan. He now rents a house and plans to default on the loan.

“The salaries of my wife and I are not enough to pay bank interest,” he said. “I have asked the bank to freeze the loan, but they did not agree. In the future, I don’t intend to pay interest because we just don’t have enough to feed our family.”

A Vietnamese police officer said the force was investigating Chi after investors had filed complaints, but that he left the country last year. He did not give his name because he was not authorized to speak to the media. It is unclear how far any probe has got. The AP spoke with two of Chi’s colleagues at Coldwell Banker who remained in Vietnam. Both said they had not been contacted by police.

This story has been viewed 2391 times.
TOP top