The municipal People's Committee submitted the proposal to the municipal People's Council on Oct. 27, seeking approval in principle for the project and for its investor under a public-private partnership using a build-transfer (BT) contract.

Covering the central Hoan Kiem and Cua Nam wards, the project would create a large square directly connecting the lake with August Revolution Square, the Hanoi Opera House, the Vietnam National Museum of History and nearby areas.

It would also expand public space, reorganize traffic and underground space, preserve and promote the area's heritage, and add suitable cultural and service facilities.

An aerial view of the Hoan Kiem Lake area in central Hanoi. Photo by VnExpress/Giang Huy

The project has three components. The first, site clearance across 30.82 hectares, would cost an estimated VND9.92 trillion ($384 million), funded from the city budget.

The second would build a four-level underground commercial center beneath the parks and squares east and north of the lake, at an estimated VND4.61 trillion ($179 million).

The third, to be carried out under the BT contract, covers construction and landscaping around the lake at an estimated VND7.694 trillion ($298 million).

It includes building the municipal People's Committee headquarters, renovating the People's Council headquarters and upgrading the landscape southeast of the lake.

Payment under the BT contract would be made in land plots, combined with state budget funds and revenue from leasing and operating the underground space built under the second component, or in budget funds raised by auctioning land-use rights and public assets.

The proposal draws on several legal documents, including the Capital Law 2026 and a June 15, 2026, Hanoi People's Council resolution that sets rules for investment policy approval, investor and contractor selection in special cases, and the identification of projects requiring immediate implementation.