Steel firm VGS to join Vinaconex in developing $238 mln urban project in northern Vietnam

Vietnam Germany Steel Pipe JSC (HNX: VGS) will partner with construction giant Vinaconex (HoSE: VCG) to jointly develop its first property project, Viet Duc Legend City, after prolonged delays.

At an extraordinary shareholders’ meeting last week, VGS said the urban development had faced major setbacks in 2024-2025 following the merger of Vinh Phuc into Phu Tho province in July, which disrupted key procedures including land clearance, compensation, and land-use fee approvals.

Under the approved resolution, VGS will remain the project’s main investor while Vinaconex will participate through a capital cooperation model rather than a new joint venture. Vinaconex will provide up to 50% of the investment capital at any stage and make advance deposits to help finalize legal processes and prepare for construction.

Located in Xuan Lang commune, Phu Tho province, the 62-hectare Viet Duc Legend City project has an estimated investment of VND6.27 trillion ($238.23 million). The first phase spans 27.5 hectares, with Coteccons Construction JSC (HoSE: CTD) contracted to build technical infrastructure for the eastern section.

Once completed, the project will feature 382 townhouses, 404 villas, 352 commercial apartments, and 952 social housing units. The high-rise social housing component received construction approval earlier this year.

As of Q3/2025, VGS recorded VND777 billion ($29.53 million) in work-in-progress costs for the project, up 3% from the start of the year.

VGS shares closed up 0.72% to VND27,800 ($1.06) each on Tuesday.

Vinh Phuc, Hoa Binh and Phu Tho were merged in July to form the new Phu Tho province, which borders Lao Cai, Ninh Binh, Son La, Thai Nguyen, Thanh Hoa, Tuyen Quang, and Hanoi.

The former Vinh Phuc province is a manufacturing hub in northern Vietnam, together with Hanoi, Hai Phong, Hai Duong, Ha Nam, Bac Ninh, and Thai Nguyen. It is home to many FDI giants like Toyota, Honda. Nissin, Piaggio, Compal, Foxcon, Fullpower, G.O. Max, Kumho, and YCH.