A Novel Approach to Risk Assessment and Investment Efficiency Evaluation for Commercial Mixed-Use Condominium Projects in Emerging Markets: A Case Study of Vietnam

Abstract

Introduction: Mixed-use condominium projects drive urban economic growth in emerging markets, contributing significantly to Vietnam’s GDP (12% in 2023), yet face challenges from market volatility and regulatory complexities [1], [2]. Conventional risk assessment models often fail to address these dynamics, necessitating innovative approaches to ensure financial viability and sustainability.

Objectives: This study aims to develop a pioneering framework to evaluate risks and investment efficiency in mixed-use real estate developments, using the Cho Con Project in Da Nang, Vietnam (2025–2029) as a case study, with a focus on integrating sustainability and advanced risk modeling.

Methods: The framework combines Monte Carlo simulations, Building Information Modeling (BIM), and LOTUS green building certification to assess two sales strategies: by floor and over time. Financial metrics—Net Present Value (NPV), Internal Rate of Return (IRR), and Return on Investment (ROI)—are analyzed alongside 5,000-iteration Monte Carlo simulations, leveraging BIM for cost precision and data from project reports, market analyses, and stakeholder interviews[3], [4], [5].

Results: The sales-over-time strategy yields superior outcomes, with an NPV of 116,573.08 thousand USD, IRR of 69.58%, and ROI of 77.11% at a 10% discount rate, compared to 108,498.39 thousand USD, 62.15%, and 71.06% for sales-by-floor. Monte Carlo simulations project a 90% profit confidence interval of 207,000–213,600 thousand USD, with land costs identified as the primary risk (-63.77% sensitivity). LOTUS certification reduces carbon emissions by 10% and enhances marketability by 3–5% [3], [6], [7].

Conclusion: The framework surpasses traditional models, improving risk prediction by 10% and cost accuracy by 5%, aligning with Sustainable Development Goal (SDG) 11. By creating 500 jobs and offering a scalable model, it provides developers and policymakers a robust tool to balance profitability, risk, and sustainability in emerging markets [8], [9], [10].