The Prince Residence - The golden location, the golden outlook

VNRE - The Prince is located on the prime street of Nam Ky Khoi Nghia - Nguyen Van Troi, connect the central District with Tan Son Nhat International Airport. The Prince is surrounded with Office - Commercial buildings, hospitals, schools and market...



The Prince has a balance that anyone could dream of – it is such a smart choice for successful people with active lifestyle.

Luxury Living



The Prince offers a variety of luxury apartment sizes: 82 m2, 88 m2, 105 m2, 110 m2, 129 m2, 152 m2.

Superior craftsmanship, meticulous attention to detail and the highest levels of specification are taken into special consideration in order to maximize the natural light, sunshine and breeze to each apartment. The unrivalled levels of interior specification and finish helps create an extension to internal space and achieve the best fengshui balance.





Living Space

The Prince is designed with ideas beyond construction norms with a desire to create generous open space and comfort for each apartment, corridors, and elevator lobby.

Facilities For a Luxurious Living





The Prince is a complex of residential and office use. There are 2 towers: the first tower has 22 stories with 228 apartments; the second tower has 8 stories with 49 apartments.

The Prince is designed to bring the owners the most comfort and convenience that life could offer, including 2 parking basement, gym, swimming pool...

Master plan



Our dream is to create the masterpieces. It is not only a house, but a home for you and your family, now and long to the future.

The Prince - Luxury living for the successfulness.

The Investor & Developer

Established in 1992, Thanh Nhon Company (the predecessor of Nova Group) initially operated with the business of producing veterinary medicine, aquaculture medicine, and building villas for rent.

In 2004, with the initial capital of VND 350 billion, Novaland Company, a member of Novaland Group, was established to develop Sunrise City project – a high class Grade A Complex of office, commerce and apartment, located in District 7, Ho Chi Minh City.

In June 2012, The Sunrise South Towers Complex was finished and was handed over to its owners. Sunrise City has been greatly supported and appreciated by
clients and experts.

Currently, Novaland Group is constantly growing and becoming one of the most prestigious companies in investing and developing real estate properties with the total chartered capital of VND 1,700 billion and total assets of VND 9,100 billion.

For further information, please contact: 

The Prince Residence Showroom
Add: 315 Nam Ky Khoi Nghia Street, Ward 7, District 3, HCMC
Tel: 84..8.3846 6868 - Hotline: 84.93 855 1919.

Novaland Transaction Center
4th Floor - V5 Tower - South Towers - Sunrise City
Add: 23 Nguyen Huu Tho, Tan hung Ward, District 7, HCMC
Tel: 84.8.3846 6666 - Fax: 84.8.3775 2999.

PARCSpring Residences

VNRE - PARCSpring will be an urban living community along the river promenade in Binh Trung Dong Ward, District 2, Ho Chi Minh City. Strategically located along the fringe of the city centre, PARCSpring will enjoy easy accessibility to Thu Thiem Tunnel and the future Long Thanh - Dau Giay Highway. Travelling to the city center will be 20 minutes.

PARCSpring will offer extensive landscaping and basic amenities for community activities set within a safe environment. The apartments are designed with functional layout to maximise your living space.

Project information:
- No of units: 974 homes
- Site area: Approximately 29,000 square metres
- Developer: Lead developer: CapitaValue Homes Limited
- In collaboration with: Khang Dien House Trading and Investment JSC.


For further information, please contact: 

CapitaValue Homes
19th Floor Kumho Asiana Plaza Saigon
Add: 39 Le Duan Street, Ben Nghe Ward, District 1, Ho Chi Minh City
Tel: 84.8.3910 6182 - Fax: 84.8.3910 6186

Reviving the Vietnamese Real Estate Market in 2013

VNRE - Resolution 02/NQ-CP and other urgent immediate and long-term recommendations aim to stop the worsening situation of the real estate business in 2013, as well as over the next 3 - 5 years.

On the occasion of the new year 2013, the Vietnam Business Forum had a talk with Mr Phan Thanh Mai, General Secretary of the Vietnam Real Estate Association, around this issue. Anh Son reports.

How would you describe the situation of the real estate market in Vietnam in 2012?

To talk about the state of the real estate market in Vietnam in 2012, we can fully use the word: severe.

Why do I say that? Firstly, the current confidence of consumers – the market participants – seriously declines and real estate businesses are, at the same time, facing many difficulties such as large inventories (finished products, under-building construction, unfinished projects not sold), while enterprises do not have the resources to recover, and thus face the risk of losing liquidity and entering bankruptcy when revenue declines past the point of offsetting the costs and expenses to maintain operations.

Secondly, input costs are too high, making it difficult for real estate enterprises to implement projects for people with average and below average income, as well as commercial projects and social housing. Specifically, in terms of cost of land, according to the regulations on land use payment and deductible compensation and land lease in the Land Law, Decree 69/2009 and Decree 120/2010, enterprises have to pay back 100 percent of the land use fee to the State, meanwhile the time of investment projects are not clear so they don’t know the exact amount of land use fee to be submitted to the State. In terms of loans, interest rates for real estate remain high, at around 17 percent / year, so the interest burden for businesses is huge. They also face construction costs and other no name costs, such as project implementation period being extended due to cumbersome administrative procedures, and overlapping at all stages, especially in land clearance and necessary approvals. Many businesses have adopted the strategy to convert commercial housing projects to social housing, or change the design by splitting flat area, but they also face many difficulties due to the provisions of Construction standards 323: 2004.

Thirdly, bad debts and overdue debts are a burden which obstruct access to new credit, leaving real estate businesses without new capital to restructure and continue operations. Along with that is the state of interest rates, about 12 – 15 percent, which is still nearly double the rate of return on equity (ROE) of real estate businesses (about 8 percent), which means that real estate business cannot run effectively, leading right back to new bad debt.

As a representative of about 1,500 real estate businesses, what are the Association’s recommendations about solutions to ease difficulties for the property market in the next few years?

Solving the problems of the real estate market is a multifaceted issue. So, based the recommendations of experts and the business association, we propose the following solutions, which need to have the cooperation of several ministries.

First, we should quickly implement the package passed by the Government to overcome difficulties and support the market, which has been issued in 02/NQ-CP Resolution on January 7th 2013. The above guidelines have a strong positive impact on the confidence of all participants in the real estate market, and the stock market. However, in order to implement the package effectively, the relevant agencies should clarify the detailed progress and deployment solutions such as: review the progress of implementation of projects in the provinces and for conversion purposes, extension of deployment or withdrawal of the project, control the supply and demand at the local level; focus on the development of social housing; support and promote demand adopted to realize the expansion of foreigners who are allowed to buy houses in Vietnam.

In addition, it is necessary to establish a Vietnam Asset Management Company - VAMC in the shortest time possible to buy bad debt at book value or market value, conduct bad debt settlement, and address overdue debt, so businesses can have opportunities to access new capital. We should submit to the National Assembly soon preferential policies for enterprises to implement social housing such as: corporate income tax of 10 percent, VAT output to drop about 5 percent in 12 months from January 7th 2013. For commercial housing projects with cost of less than 15 million / m2 and area below 70m2 / apartment, the preferential VAT policy output fell to 30 percent in 12 months from January 7th 2013.

Secondly, we need to stimulate public investment, especially investment in infrastructure. This is the foundation to improve confidence of all actors on the market. It’s necessary to settle infrastructure works in progress, and actively promote the project to solve the problem of urban traffic; and continue reforms towards "one-stop-shop" at Provincial Committee departments, in order to shorten half-time evaluation and planning approval, especially settlement procedures adjusting detailed planning of 1/500 and the design of the project in stock, unfinished construction, conversion from commercial houses to social housing.

Thirdly, we should suspend the decrees, resolutions and circulars in 2013, without the comments of the enterprises, if their content does not support the market. It’s urgent to focus on amendments supporting market policy. In the draft policy, businesses can now give feedback and after the enactment, it’s necessary to give guidance for businesses. The policy should include not only sanctions, but also preferential terms. Especially after a period of policy implementation, we should review and measure the level of "companion" policy.

For specific ministries, the introduction of measures to shore up the market is very important. What does the Association propose regarding the ministries and agencies?

To the central bank, the Association proposed further reduction of interest rates to 8-10 percent / year, because the rate of return on equity (ROE) of real estate business is very low. At the same time, it’s necessary to have preferential policies on interest rates or reduce their tax for commercial banks, which spend annually 3 percent of total loans for social housing development. It should also form a re-mortgage model (Malaysia model), providing new funds for home buyers, especially in the form of policy objects and social housing.

It should also give the package of VND20,000 - 40,000 billion for social housing and commercial housing under VND 15 million/m2 for houses of less than 70m2 with an interest rate under 8 percent / year, so customers have the ability to pay.

To the Ministry of Finance, we proposed applying double non-taxation through cutting corporate income tax equal to 0 in order to promote real estate investment fund models (similar to real estate investment trusts REITs) under Decree 58/2012/ND-CP; delay and reduce VAT for businesses in general which have large inventory associated with the real estate industry and construction materials, provided that the product inventory is of domestic origin; and exclude the land use fee for projects completed land use fees in accordance with the law for merger of Hanoi.

For the Ministry of Natural Resources and Environment, the early research suggested the Land Law (Revised), which clearly stipulates how the market price of land is determined. Amending Decree 69/2009 / ND-CP content "land use fees at market price monitoring mechanism" to avoid tax 2 times; allow transfer of the payment of land use from the investor to the purchaser responsible (apply as in the case of Phu My Hung, Ciputra); Buyer may owe land use (such as applied when GCN authority to use the land for the first time for families and individuals workers) in the period from 3 to 10 years, homebuyer assistance through the mechanism of payment of land use.

To the Ministry of Construction, we proposed considering a change to the standard of high-rise building on the prescribed flat rate small, medium and large in proportion 1:2:1 as inconsistent with the facts; instead, it should allow businesses to balance and select the rate in accordance with market demand, by region and by project; and reduce the area target from at least 8m2/person in Part 2, Section 2.42 "regulations on planning land use” of QCXDVN01: 2008/BXD into 5m2/ person in the planning criteria for the construction of public housing group.

Source: VCCI News

Happy Valley at Phu My Hung

VNRE - Happy Valley shopping & apartment complex has a campus area of 42,000 sqm located on 3 Lot R12, R15 and R18. Overall project consists of 14 blocks with a height from 8 to 28 storeys.


The complex will include a seven-storey shopping center with an area of over 70,000 sqm, a 20-storey office building, others are apartment buildings.

Exceptional location

An exceptional location in Phu My Hung City Center: Opposite to Saigon South golf course and beautiful scenic river, next to giant Saigon Wonderland park, Happy Valley is a great combination between architecture and nature, shaping an ecological living environment right in the heart of a self-contained city.


A human-centered design

Stunning landscape combined with human-centered designs create an ideal living space for the whole happy community.

Not merely a living space, at Happy Valley, residents will fully experience the happiness from even the simplest activities, from children’s playing, warm moments of family get-together to residence community’s friendliness.


Nearby facilities

The project is close to the entertainment hub - The Crescent with Starlight bridge, Crescent Mall, 700-meter promenade, and International Commercial and Financial District, bringing happy citizens lots of life’s conveniences.


The project was started construction in late 2012, expected to be announced on 03/2013. Phase 1 of the project will be completed within 18 months.

For further information, please contact:

Phu My Hung Real Estate Transaction
Ground Floor, Lawrence S. Ting Building
Add: 801 Nguyen Van Linh Parkway, Tan Phu Ward, District 07, HCMC
Tel: 84.8.5411 8888 - Fax: 84.8.5411 5678
E-mail: info@phumyhung.com.vn

Hanoi Office: Room 1404-1405, Vietcombank Tower
Add: 198 Tran Quang Khai St., Hoan Kiem District, Hanoi
Tel: 84.4.3936 2640 - Fax: 84.4.3936 2641

DTZ Research: Ho Chi Minh City Q4 2012 - Market conditions continue to weaken

VNRE - Economic growth slowed to 5.03% in 2012, the slowest expansion since 1999, due to weak domestic demand. Inflation eased from 18.7% in 2011 to 9.21% in 2012, which gave the government room to cut the benchmark refinancing rate six times in the year by a total of 600 basis points. The economy was supported by exports which grew more strongly than imports, giving a trade surplus for the first time in two decades. Tourist arrivals increased by 11.4% over 2012. The economic outlook for 2013 remains uncertain with projected growth of 5.5%.

- The office market remains a tenants’ market, as weak net absorption was overshadowed by the increase in supply. Occupancy rates declined slightly overall although Grade A space finished the year at 77.2% from 74% one year ago. Consequently rents softened by 2.0% in Q4 2012 and by 6.5% over 2012. Looking forward, we forecast further challenges in 2013 for landlords as more supply is expected to come on to the market.

- Total retail sales values of goods and services in HCMC increased by 16.4 percentage-points year-on-year (y-o-y) in the first eleven months of the year, attracting foreign retailers and holding rents firm. However the projected substantial increase in new supply of retail space should serve to dampen occupancy rates and rents. This is expected to be felt particularly keenly outside the CBD, which will see the bulk of new supply.

The residential market continued to be challenging in 2012 with many developers delaying the launch of projects whilst others have had to reduce asking prices to attract potential buyers. Demand is expected to continue to be slow in early 2013 with any increase in activity dependant on the government reducing the land tax on houses as well as an improvement in the general economic environment.

Economic Overview

Economic growth eases

Vietnam in Q4 2012 grew at a faster pace of 5.44% y-o-y compared to 5.05% in Q3 (Figure 1). However, it registered economic growth of 5.03% for 2012 overall, lower than last year’s 5.89% and the lowest since 4.77% in 1999. One of the main factors that contributed to the slower growth is weak domestic consumption as a result of tight credit availability.

Inflation eases

Inflation eased to 6.8% y-o-y in December 2012, following a 7.0% increase in October and 7.1% in November (Figure 2). Inflation for 2012 fell to 9.2% from 18.1% in 2011, as the government made curbing inflation its top priority for the year.

Due to the lower level of inflation, the central bank in December cut its benchmark-refinancing rate by 100 basis points to 9.0%. The refinancing rate has been reduced by 600 basis points for the whole year. Lending rates in Q4 remained unchanged from the previous quarter at 14-16%, having fallen from above 20% in Q4 2011. Nevertheless, consumer confidence remained low and business conditions continued to be difficult and constrained by credit availability.

Higher exports but lower FDIs

Due to sluggish domestic demand, imports grew at a slower pace than exports. Based on preliminary figures from the statistics office, exports increased 18.3% in 2012 to reach USD114.6bn while imports came in slightly lower at USD114.3bn, up by 7.1%. As a result, Vietnam recorded a trade surplus of USD284m for the year. This was the first time it achieved a positive balance in twenty years. According to the General Statistics Office, foreign firms made up the majority of high value exports while local businesses mostly exported cheaper goods or raw materials.

Foreign Direct Investment (FDI) inflows to Vietnam ended the year at an estimated USD12.72bn, a decrease of 15.3% over the previous year. The processing and manufacturing industries had the largest level of FDI in Vietnam attracting 9.1 billion USD or over 69.9% of total investment value. In 2012, the real estate sector ranked second, bringing in USD1.85bn or 14.2% of total FDI. Japan remains Vietnam’s biggest foreign investor, accounting for 39.5% of total foreign investment into the country in 2012.

The fall in FDI can be attributed to the government’s fiscal position on reducing high levels of debt, which resulted in a reduction of large-scale real estate projects. December saw the introduction of tightened policies on foreign investment to improve the quality of FDI.

Tourist arrivals set to break record

The tourism sector continued to enjoy steady growth. Vietnam welcomed 6.647 million tourists in 2012, an increase of 9.5% from 2011. Strong growth came from tourists visiting relatives (26.8% of total tourists) and business travelers (28.5%), with the latter indicating an ever increasing interest in investment in Vietnam. The sector achieved the target of over 6.5 million tourist arrivals for the year and exceeded 2011’s record of 6.0 million visitors.

Looking to 2013, the government has set a target of 5.5% GDP growth, with inflation to be curbed at 6.5%. If inflation eases in early 2013, there could be a loosening of anti-inflationary measures including allowing the banks to increase access to credit and thus stimulating investment.

Offices

Occupancy declines due to new supply

Office supply at the end of Q4 2012 is estimated at approximately 1.485 million sq m NLA (Figure 3). There was nearly 24,000 sq m of new supply in the quarter, resulting in an addition of 103,747 sq m for 2012 across all grades. This new supply is approximately 50% of the NLA completed in 2011.

Demand for office space was low in Q4 at around 10,000 sqm, as some existing tenants explored opportunities for relocation while a few exited the market altogether. Net absorption for the year was estimated at around 69,000 sqm, representing only 37% of last year’s demand.

The average occupancy across all grades of office accommodation declined to approximately 80.15% at the end of 2012, from 80.7% at the end of Q3 2012 and 81.15% at the end of 2011. There was approximately 295,000 sqm of office space available across HCMC.

Grade A occupancy remained at 77.2% in Q4, similar to Q3, but improved from 74.0% in Q4 2011 as there was no new Grade A office stock in the last eight quarters (Figure 4). Nevertheless Grade A office buildings recorded lower occupancy rates compared to Grade B and Grade C buildings due to the significantly higher rent demanded.

Grade B and C occupancy rates fell slightly 0.4% q-o-q and 1.4% y-o-y to 80.6% and 0.97% q-o-q and 1.97% y-o-y to 81.03% respectively.

Rents continued to decline

Rental rates continued to decline during the quarter with average rents throughout all grades falling by approximately 2% quarter-on-quarter (q-o-q) to USD20.0 per sqm per month. In Q4 average grade A rents declined by approximately 2%q-o-q and 6% y-o-y to USD31.00 per sqm per month. Grade B and Grade C average rents decreased 0.04% q-o-q and 3.74% y-o-y to USD19.77 and 2.27% q-o-q and 5.84% y-o-y to USD16.11 respectively.

Landlords with newer properties have been forced into competing with established properties for existing and new tenants with substantial incentives being offered to tenants to entice new leases to be signed. Amidst the fierce competition, tenants have negotiated desirable deals to their advantage.

In 2013, approximately 270,000 sq m of new office accommodation is forecast to enter the market if all current developments in the pipeline are finished on schedule, although it is not likely to occur due to delay in completion (Table 1). Notably, an increasing number of developers are facing difficulty in raising capital investment and without pre-commitment, they have delayed completing their developments.

Nevertheless, the increase in supply of new office space is forecast to outstrip the demand for space in 2013 due to local and global economic conditions. We therefore expect to see rents continue to soften across all grades in 2013.

Retail

Rents hold steady while occupancy falls

In early Q4 2012, the retail market saw the major completion and opening of Vincom Center A (Eden A) in District 1, which achieved an occupancy rate of 90% among the 38,000 sq m of high-end retail space. The increase in supply in the quarter was approximately 27,077 sq m NLA, bringing the total stock in the city to approximately 332,212sq m NLA (Figure 5). It is forecast that about 40,000 sq m NLA retail space will be completed by 2013. Included in the pipeline supply is approximately 150,000 sq m NLA of space in different stages of construction or completed in Q4 that has not yet opened for operation. This includes Times Square in District 1, Sunrise City in District 7, A Pico Plaza in Tan Binh Distrct and Vista in District 2.

Retail spending in the first eleven months reached USD100.8bn, an increase of 16.4% y-o-y. However, this increase would only be 6.4% if price rises were excluded. In a global consumer confidence survey conducted by Nielsen, it found that the consumer confidence index for Vietnam was up 4 points y-o-y to 94 points for Q3 2012, although 9 out of 10 (91%) Vietnamese were changing their spending habits to save more.

Foreign retailers are driving the demand for retail space in Vietnam with many looking to expand and enter the local market.

The average occupancy rate in HCMC fell 0.9 percentage-points in Q4 (Figure 6). The full year decline was 2.6 percentage-points. Retail occupancy remained lower in non-CBD locations when compared with CBD locations.

Average rents for department stores and shopping centers remained the same as in the previous quarter at USD95 per sq m per month in CBD and USD46 per sq m per month for non-CBD areas. Average rents in CBD and non-CBD department stores and shopping centers softened through the year, dropping USD11 per sq m or 11% and USD14 per sq m or 24% respectively.

Strong pipeline supply to dampen rents

Looking forward to 2013, we expect retail rents to soften with a steady supply in the pipeline. If all current developments were completed on schedule by 2014, approximately 730,000 sq m of retail space would be added, which is a substantial increase. Some major upcoming retail developments are included in Table 2. The non-CBD accounted for 70% of supply in the pipeline, which will increase the suburban competition in the near future.

Residential

Delay in launches

The total stock of condominiums in HCMC at the end of 2012 was approximately 60,100 units from 223 completed projects (Figure 7). A substantial new supply was added in Q4 although many developers are delaying construction, with no ground breaking reported in the quarter. There were 11 new completions in Q4, totalling 3,276 units. The three biggest projects completed in the quarter were Estella (710 units) in District 2, Tanibuilding (673 units) in Tan Phu District and Thai An 3 & 4 (600 units) in District 12.

With the current challenges in the market, many developers have delayed launching projects. Those that were launched have reportedly been met with a weak market response. Three apartment residential launches were carried out in Q4 including 620 units from Hoang Anh Thanh Binh Apartment in District 7 (priced between USD990-1,100 per sq m), 632 units from Sunrise City Phase 2 in District 7 (priced between USD1,650-2,150 per sq m), and 822 units from Cheery 4 Apartment in Thu Duc District (priced between USD570-750 per sq m). Take up rates for these launches were reported to be 30% for Hoang Anh Thanh Binh Apartment and 20% for Cheery 4 Apartment. These low transaction levels suggest that the majority of potential purchasers are waiting for further reductions in house prices.

Prices continue to decline

Weak market conditions in Q4 have persuaded developers to reduce asking prices. Prices over 2012 have fallen on average by 1% throughout all grades in HCMC as many developers want to maintain their profit margins. Asking prices in Q4 for affordable condominiums ranged between USD500 to USD950 per sq m and USD950 to USD1,700 per sq m for mid-end units. High-end condominiums price ranged upwards of USD1,700 per sq m.

Future supply will continue to dampen selling prices. If all future projects at the planning stage or under construction are completed as per schedule, approximately 40,000 new units will be provided before the end of 2014. Table 3 gives some numbers of major upcoming developments. However, delays in the construction are likely to occur as developers await an upturn in the market.

The outlook towards 2013 will continue to be bleak as activity in the residential sector is likely to remain slow due to affordability problems and reduced consumer confidence. Buyers traditionally wait until after Lunar New Year to make purchases so demand should be subdued in the early part of 2013. However, if the government reduces land tax on houses, this should lead to an increase in activity in the residential market.

Reported by: DTZ Vietnam
Save this report to your device (pdf): Property Times Q4-2012
Photo courtesy of Denis Sorokin

Vingroup became founding member of World Economic Forum

VNRE - Vingroup was recently honored as a Founding Member of the World Economic Forum (WEF) one year after it joined the WEF community of Global Growth Companies (GGC). The WEF bestows this senior title to recognize 1,000 outstanding enterprises from all over the world that have stimulated domestic economic growth and shown strong potential for international development.

Since joining the WEF on July 1, 2011, Vingroup has been highly appreciated by the WEF for its outstanding growth as well as its strong regional position and influence. The WEF acknowledged Vingroup as the leading real estate company in Vietnam, with a strong independent financial capacity and great potential for growth in both domestic and international markets.

The WEF noted that Vingroup is well respected and has an extremely good reputation among its domestic and international customers and partners. Vingroup’s management was also praised for their dynamic pioneering spirit and for being “wonderful ambassadors of the Vietnamese economy.”

Vingroup’s foundation membership will take effect on January 1, 2013. The title is given to only 1,000 enterprises that are leaders of major industries in their countries and have shown a level of international influence.

This new position offers Vingroup a greater voice in global economic issues and also entitles its representative to attend the Davos Annual Meeting of scholars, experts, scientists and leaders of international organizations and the world’s biggest corporations. The Davos Annual Meeting is a global network of prestigious enterprises that opens up opportunities for businesses seeking initiatives, investment and cooperation with potential partners. WEF founding members report that 25-30% of their annual revenue is derived from the cooperation agreements signed at the Davos Meeting.

“We are ready to share and take advantage of new opportunities through the WEF, and maximize the benefits of being a member of the world’s largest network of enterprises. This honor, along with Vingroup’s other regional and international awards, has confirmed our new internationalization strategy and we hope it will present a positive and dynamic image of Vietnam to the world,” said Ms. Le Thi Thu Thuy, Vice Chairman cum General Director of Vingroup.

Founded in 1970, the World Economic Forum (WEF) is an independent international organization committed to improving the state of the world by encouraging political, academic, social and business leaders to shape global, regional and industry agendas. With a membership of nearly 2,500 top business leaders, politicians, scientists and experts from 90 countries, the WEF is the world’s largest and most influential economic forum. Its most important meeting of the year is scheduled to take place from January 23 to 27, 2013 in Davos, Switzerland.

Source: VinGroup

Exceptional Drought Conditions Squeeze Farmers

Communities all over the Midwest and parts of the Intermountain West are continuing to suffer under extreme and "exceptional" drought. Cities all over the region are urging residents to conserve as much as possible, while crossing their fingers that rain and snow will fall and replenish water storage supplies. Communities like Paris, Arkansas, and many others, which have implemented strict water use restrictions.

The drought has severe impacts on agricultural production, an important economic service in the Mid-and Intermountain West. The U.S. Congress was unable to pass a bipartisan Farm Bill last year, but the drought has spurred many, including Senators Michael Bennet and Mark Udall, to plead to the House to pass the bill this year. The Farm Bill includes provisions to aide ranchers and farmers in times of drought.

In Colorado, the drought is in its third consecutive year, and many rivers are flowing below 10% of their normal levels. Yesterday, the USDA designated roughly two-thirds of Colorado's counties as disaster areas as a result of prolonged, extreme drought conditions (La Junta Tribune). Although snowpack is accumulating in the Colorado headwaters region in the western part of the state, the eastern part of the state continues to remain dry. For more information about the drought in Colorado, visit CSU's Colorado Climate Center.

A Twenty-First Century Water Policy: A Review - 2 of 3

This is part 2 of a review of Pacific Institute's latest book, A Twenty-First Century Water Policy. For part 1, click here.

Water quality and freshwater ecosystems are two areas of important consideration in the next century of water policy. They are addressed in Chapters 5 and 6 of the book.

WATER QUALITY
The chapter, written by Lucy Allen, begins with a brief overview of the development of water quality regulation and policy in the 20th century. The good news is, water quality has dramatically improved in most places, thanks in large part toe the Clean Water Act, which gave the federal government the power to regulate water pollution and manage the "biological integrity" of our nation's waters. Today, forty years after the CWA was passed, we still wrestle with water quality problems, but they have shifted in nature. Runoff from urban or agricultural sources, called non-point pollution, is a hairy and seemingly intractable problem now, and the CWA doesn't do very well at addressing how to mitigate this type of input. New contaminants (like volatile organic compounds) are not well understood. Monitoring and assessing the health of rivers has not been adequately pursued by states under the NPDES system.

Percentage of assessed waters found to be impaired, from
 A Twenty-First Century Water Policy (2012)

The soft path of water policy, advocated by the authors, would capture the power of the CWA and integrate it with existing legislation on drinking water (the Safe Drinking Water Act) in recognition that clean waterways would necessarily facilitate and lower the cost of clean drinking water. In addition, Best Management Practices, which have been shown to be effective in limiting pollution inputs from agricultural and urban sources, could be made mandatory. More research into the effects of VOCs and other less understood additive or synergistic effects of pollutions should inform state and federal water quality standards.

All of these measures are a far cry from re-inventing the wheel, and could simply be applied to legislation and policy frameworks currently in place.

FRESHWATER ECOSYSTEMS

Ecosystem values and services were rarely considered during the 20th century engineering boom. The authors of Chapter 6, Lucy Allen and Juliet Chrstian-Smith, explain what the soft path of aquatic ecosystem policy would look like. The soft path acknowledges ecosystems as legitimate users of water resources and the services they provide. The maintenance or restoration of ecosystems is an explicit policy objective. In our current policy environment, "...adequate ecosystems continue to decline, in large part due to water-use and land-use decisions that do not consider freshwater ecosystems and instream flows." Growing human demand for water, altered size and timing of river basins due to human engineering systems and withdrawals, and increasing extreme weather events contribute to degradation of aquatic ecosystems. As a result, an estimated 39% of fish and other aquatic species are endangered, threatened, vulnerable or extinct and 42% of the US stream length is estimated to be in "poor condition." The Environmental Species Act has been given priority and makes it extremely powerful, but also targeted for litigation and amendments.

The soft path for aquatic ecosystem policy would start with more data, more data, more data. Long term effects on biological indicators from contaminants and physical alterations to waterways needs to be understood in order to be integrated into actionable policy. In addition, the current language of the CWA supports using biological indicators as a standard, which means the focus can shift from chemical indicators as the sole measurement of stream health, a myopic approach. The Secretary of the Interior can coordinate with governors to designate more rivers under the Wild and Scenic Rivers Act, which can provide instream rights and open up funding for better management and monitoring. Market-based solutions, including pricing and water market trades are likely to facilitate the conservation behavior of users. New water infrastructure projects should integrate environmental flows into the decision-making process, and unsafe dams should be removed. The authors state that "These solutions can be applied without compromising state sovereignty over water allocation."

Most of the problems and ideas outlined in these chapters have been state elsewhere by others. But to have it all compiled in a single book helps make the case that these changes are not only smart, they're obvious. The problem will always be that the solutions require more interagency cooperation, more funding, and more research. Implementing those things will be akin to turning the Titanic. It will probably be slow.

Las Vegas pipeline project approved

photo from wikia

The controversial pipeline proposal that would transport groundwater from rural Nevada to the thirsty city of Las Vegas was given approval by the BLM this week, according to the RCAC and the Associated Press. The pipeline has been on the project horizon for decades, and despite opposition from a diverse set of groups including ranchers, environmentalists, Native American tribes, and municipalities, the project has overcome what could be the last hurdle, and construction may begin this year. The population of Las Vegas is around 2 million, and continues to grow, increasing the pressure on the city to look for ways to augment the water supply.

The pipeline will transport 84,000 acre-feet of water from groundwater sources in rural Nevada counties across 263 miles.