As Asia’s Real Estate Capital Gets More Selective, Vietnamese Players Bet on Sustainable Megacities

Asia’s real estate market is entering a phase where scale alone may no longer be enough to make a megaproject investible. Commercial real estate investment in Asia Pacific rose 22% year-on-year to $157 billion in 2025, according to CBRE, with volumes expected to increase another 5-10% in 2026.

At the same time, investors are increasingly prioritising income growth, high-quality assets and long-term resilience over pure capital appreciation.

This shift is particularly relevant for large urban developments. Cities account for more than 80% of global GDP while consuming around 75% of the world's energy, according to the International Energy Agency (IEA). The agency has also highlighted the importance of integrated urban planning and infrastructure as cities face rising energy demand and climate pressures.

The question, therefore, is moving beyond how large or technologically advanced a planned city can be. It is increasingly about whether the development can attract residents, businesses and investment — and remain economically and environmentally viable once the construction cycle ends.

The Megacity Test

Several high-profile projects illustrate the challenge. South Korea's Songdo was conceived as a model smart city and has attracted billions of dollars in investment, but its development has taken longer than originally envisaged.

Indonesia's Nusantara, meanwhile, was planned as a sustainable "forest city" and the country's new capital. But budget reductions and slower-than-expected population growth have raised questions over the pace at which the project can reach its original ambitions.

Abu Dhabi's Masdar City offers a different trajectory. Its development has focused on energy efficiency and low-carbon infrastructure from the outset. The International Renewable Energy Agency moved its headquarters there in 2015, with the building incorporating solar generation, passive design and energy-management systems.

These examples highlight a broader challenge for megaprojects: a sustainable city cannot be judged only by what it looks like on completion. Its real test comes from how it functions.

Vietnam's ESG Bet

Vietnam's Vinhomes is positioning its latest developments around that premise. The country's largest listed real estate developer has introduced what it calls an "ESG++" framework, adding two dimensions — Regeneration and Climate Adaptation — to the conventional environmental, social and governance framework.

The approach is being applied to its large-scale urban projects, including Vinhomes Green Paradise in Can Gio in southern Vietnam and Vinhomes Global Gate Ha Long in the north.

Vinhomes Green Paradise spans 2,870 hectares and sits alongside the Can Gio Mangrove Biosphere Reserve, a UNESCO-recognised ecosystem. The developer has positioned the project around biodiversity conservation, renewable energy, resource circularity and climate resilience. Vingroup says the development has a construction density of 16% and is targeting clean electricity across its operations.

The project has also attracted international attention. In November 2025, New7Wonders named Vinhomes Green Paradise the first official participant in its "7 Wonders of Future Cities" campaign, evaluating it across environmental and nature, smart-city and human-centric development criteria.

The development is being built with a reported investment of around $10 billion and is expected to be supported by new transport infrastructure, including a planned high-speed rail connection to central Ho Chi Minh City.

The distinction matters because Vinhomes is attempting to move the sustainability conversation upstream — from individual buildings to the functioning of an entire urban ecosystem.

At Green Paradise, the company says the model will incorporate renewable power, electric mobility, AI-enabled urban management, resource recycling and mangrove restoration. Its ESG++ framework is intended to link environmental protection with the project's long-term economic and social performance.

The northern project, Vinhomes Global Gate Ha Long, represents a different proposition. The development spans around 6,200 hectares and was officially launched in December 2025. A May 2026 market report put its planned investment at around $18 billion.

The project is expected to benefit from planned high-speed rail infrastructure linking Hanoi and Quang Ninh, while its masterplan includes residential, commercial and business districts.