The booming real estate market appears disinclined to renovate rundown apartment blocks as a means for profit due to a variety of bureaucratic obstacles, governmental officials have complained.

Most provinces across the country have failed the Ministry of Construction’s March 10 cut-off date to submit detailed progress reports on repairing dilapidated apartment buildings, as part of the government’s nationwide program to fix such apartments by 2015.

“Officials at the Hai Phong Department of Construction pose the question of why should it fix decades-old apartment buildings and then not be able to sell them?” said Nguyen Trong Ninh, deputy head of the ministry’s Bureau of Housing Management.

“At the same time, the state budget does not allocate any resources for us to take proactive steps to manage the process.”

The two provinces that met the deadline, Hai Duong and Vinh Phuc, only submitted brief reports.

According to the Vinh Phuc Department of Construction, the province’s sole apartment building was built in the early 1960s and has more than 100 apartments.

There isn’t an urgent need for renovation, its People’s Committee said, since the strip of land would soon be reserved for another project.

Hai Duong simply reported to the ministry that the province does not regard renovating old apartments a pressing issue due to the sluggish local real estate market.

At least 60 percent of the country’s total three million square meters of antiquated apartments – most of which were constructed before 1991 – are in need of repair, according to the ministry’s latest statistics.

Most apartments, usually ranging from four- to five-stories high, do not include elevators or possess standardized fire protective systems.

According to Ninh, the ministry did not receive any complaints from provincial governments regarding potential inability to meet the deadline.

“But not a single province started doing any work,” he said.

“Though the ministry is willing to negotiate zoning plans, it behooves local governments to provide detailed reports and timelines to renovate area structures.”

Some experts say the government could take advantage of these structures’ locations, mostly located in attractive metropolitan areas.

If bureaucratic obstacles such as clarifying compensation and delegating resettlement responsibilities to relevant agencies – two policies that often get bogged down in the approval process – could be overcome, the state could lure investors into upgrading these buildings for profit.

An recent incident in Hanoi highlighted public officials’ awkward handling of renovation procedures.

In the case of the B6 apartment block located in Ba Dinh District’s Giang Vo neighborhood, several companies have squabbled over who actually has the right to reconstruct the building.

In 2004, the Hanoi People’s Committee had agreed to allow the Hanoi Joint Stock Company ITC to research and conduct proposals to overhaul the apartments.

By January 2006, the Hanoi Department of Architecture Planning had accepted ITC’s proposal and by July of that year, the Department of Construction also approved its design plan to construct a new high-rise apartment block.

“We only needed the city’s approval to start work on these apartments,” said Nguyen Huu Dinh, ITC’s general director.

However, the company was subsequently challenged by other businesses over its exclusive entitlement as the project’s sole investor.

Another company meddled in the affair through the resettlement process, even going as far as organizing community meetings and offering different compensations for residents who were authorized to move out from the block.

Yet, even after residents had abandoned their homes, no repair work or restoration activities have commenced on the structure.

Reported by Tuyet Nhung