HÀ NỘI — The market upgrade by FTSE Russell to secondary emerging market status could broaden access to international capital for listed property companies, creating additional options for equity fundraising, investment structures and share-related transactions rather than directly channelling new funds into real estate projects.

Effective September 21, Vietnamese stocks will be included in the FTSE Global Equity Index Series and related indices in stages through 2027.

The upgrade is expected to potentially attract up to US$6 billion into Việt Nam's stock market. However, the potential capital inflow relates to the equity market and should not be viewed as a forecast of direct investment into the property sector.

For real estate companies, the relationship between the market upgrade and the property market is therefore indirect. 

International investors may allocate capital to shares of listed property developers, but such investment does not mean that the money will immediately become funding for project development.

Capital flowing into shares initially affects companies' access to capital and the liquidity of their investments. To turn that capital into resources for real estate operations, companies still need the ability to absorb capital, suitable projects, financial structures that meet investor requirements and the capacity to generate cash flow.

The impact of the upgrade, therefore, needs to be considered in the broader development of the capital market. For property companies, a capital market with wider access could provide additional options for raising equity and conducting share-related transactions.

For institutional investors, a more liquid capital market could also provide another way to gain exposure through companies rather than investing directly in individual properties or projects.

Experts from Savills Vietnam said it was important to distinguish between capital-market liquidity and real estate asset liquidity.

A stock can be traded on the market within a relatively short period, while transferring a property remains dependent on its location, quality, legal status, cash flow, market demand and price. As a result, improved liquidity in the stock market does not automatically make real estate assets easier to buy or sell.

Thomas Jacobs, country manager of the International Finance Corporation (IFC) in Việt Nam, said the upgrade would enable Việt Nam's capital market to access a broader and more diverse group of global investors, thereby increasing liquidity and creating conditions for domestic companies to access longer-term capital for growth.

From this perspective, the upgrade could be viewed as an expansion of the capital ecosystem available to the property sector rather than a mechanism for directly transferring stock-market capital into real estate projects.

Selective recovery in capital flows

The upgrade comes as the Asia-Pacific real estate market is recovering. 

According to Savills Global Capital Markets, in the second quarter of 2026, total real estate investment in the region reached about $46 billion, up 18 per cent year-on-year in the second quarter.

Cross-border capital flows remained an important driver, alongside transactions involving the acquisition of partners’ stakes, minority share sales and recapitalisation. However, the pace of recovery varied across markets.

Globally, Savills said investment opportunities were becoming increasingly selective, with investors focusing on fundamentals and segments with clear income-growth drivers.

The recovery in regional capital flows therefore does not mean capital will automatically move into Việt Nam, according to Savills. The ability to turn investor interest into actual transactions remains dependent on the quality of individual opportunities and their ability to meet the requirements of different sources of capital.

For listed property companies, broader access to the capital market can change the way they approach investors. Fundraising will then involve not only borrowing or issuance but also capital structure, asset quality and the ability to create value for shareholders.

A more open and liquid market can also give companies access to a broader pool of institutional investors. At the same time, investors will have another way to participate in the property market through company shares without directly owning a specific property.

The mechanism, however, also places risks at the corporate level. Investors need to assess financial leverage, project progress, cash flows, debt obligations and the ability to implement business strategies.

The value of the FTSE upgrade for the property sector, therefore, may lie less in the immediate amount of new capital and more in expanding options for fundraising, investment structures and exits. — BIZHUB/VNS