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Real estate developers threatening to sue consultants   2008-12-16 - VNE

Many real estate developers have threatened to take legal actions against real estate consultancy firms for their release of misinformation regarding real estate prices.


Kien A, Daewon Hoan Cau, and Phu My Hung are furious after the real estate consultancy firms, including CBRE and Vinaland, released the wrong information about the prices of the real estate projects they develop.

Kien A, the developer of Blooming Park, released the proof late last week to show that the real estate survey result information by Vinaland was misleading.
According to Vinaland, in late November and early December, the penthouse at the Blooming Park project saw a price decrease of 6.1%, or VND 2 million per square metre. However, Kien A’s Planning Division’s Head, Cao Thanh Hoang, showed proof saying the information was incorrect.
Hoang said that only one out of ten penthouses has been sold. The buyer of the penthouse was a foreigner, who paid a deposit sum equal to 10% of the penthouse value. Hoang said that the buyer has confirmed he has not put the penthouse on the market.
“Vinaland has to check the information and prove that the price has decreased by VND 2 million per square metre. If mistake is found and Vinaland does not correct the information, Kien A will sue Vinaland for misinformation,” said the investor of Blooming Park.
Chairman of Vinaland Invest Corp., Tran Minh Hoang, has asked his staff to check their information and admitted the mistake happened in the process of data entering.
Hoang said that the mistake proves to be unavoidable when employees have to deal with the figures from thousands real estate projects.


The story of CBRE proves to be not as simple as Vinaland’s story, as CBRE’s information has hurt many big real estate developers, facing the critical protest from them.
The report released by CBRE at the end of November 2008, cited the examples of the apartments’ price decreases. The report said that the price of Cantavil Hoan Cau has dropped from US $3,700/sq m to US $2,600/sq m in the last twelve months, while the price at the My Phuc project has dropped by 50%, from US $1,750 sq m to US $872. However, the information was described as ‘untrue’ at the report launching ceremony.
The Legal Expert of Daewon Hoan Cau, Nguyen Huu Nhi, said that on December 10, Nhi asked CBRE to explain about the information that Cantavil’s price dropped from US $3,700 to US $2,600. He was replied that the apartment CBRE mentioned in the report is located on the 6th floor, which has the area of 155 sq m, while refusing to provide other information. However, CBRE on December 15 said that the apartment’s area is 156.3 sq m.
Three apartments on the sixth floor have been sold, including two internally sold, while the third was sold to the client, who purchased for his accommodation. The apartment has the area of 120 sq m, and the price was US $3,091 per sq m.
Nhi said that CBRE has to prove that the information it has provided is accurate, or it has to correct the information on mass media and apologize for this.
Business and Marketing Director of Phu My Hung Company, Truong Quoc Hung, also said that there were big differences between CBRE’s information and the real prices.
Meanwhile, CBRE’s representative on December 15 promised that the company will check the information and have working sessions with enterprises on the issue.

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