Hotels show the way in lost property market

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Báo Đầu Tư English - 38 month(s) ago 7 readings

Hotels show the way in lost property market

The hotel sectors in Hanoi and Ho Chi Minh City are booming despite a generally sluggish property market.

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This year both Ho Chi Minh City and the Vietnamese capital have seen an overall rise of 5-10 per cent in occupancy rates against 2010. This has meant at least a 15 per cent boost against the weak revenue per available room (RevPar) levels recorded back in 2009.

According to Robert McIntosh, executive director of CBRE Hotels Asia Pacific, the potential for hotel investment in the Asia-Pacific region and in Vietnam is high, especially for investors looking at long-term growth.

“The sector has made a very strong recovery post financial crisis with the majority of the Asian cities increasing the RevPar by at lease of 20 per cent as compared to the pre-crisis period. Such growth during adverse global conditions certainly shows the investment potential of this sector,” McIntosh said.

At present Hanoi has nearly 7,700 rooms in the three- to five-star range. In the third quarter of this year, the overall average room rate per night was at $73, RevPar was $31 and the average occupancy rate was at 52 per cent.

Hanoi received 898,000 international visitor arrivals in nine months of this year, up 6.7 per cent year-on-year. Domestic arrivals, meanwhile, reached 5.3 million, or 8 per cent down year-on-year.
These figures saw Hanoi earning a lowly sixth place in Smart Travel Asia’s Asian destinations list but experts believe Hanoi will lure more visitors in the coming months.

Thanks to the traditional high season at the end of the year, performance is expected to improve between 5 to 10 per cent in both market average occupancy and average daily room rate.
Those experts also believe the three-star segment will remain attractive to visitors and developers while the four- and five-star segments will have to struggle to maintain an acceptable margin.
According to property consultant Savills Vietnam, meanwhile, the total number of three- to five-star hotel rooms in Ho Chi Minh City is approximately 10,000, unchanged from the previous quarter and a year-on-year increase of 16 per cent.

In the first nine months of 2011, the number of international arrivals to Ho Chi Minh City was 2.4 million, up 3 per cent compared with the second quarter of 2011 despite this being low season. Figures were also up 11 per cent compared with the same period in 2010. Both are positive signs of life for tourism in Ho Chi Minh City.

Numbers of international visitors coming for business were up 10 per cent on the same period last year and accounted for 20 per cent of total international arrivals to the southern hub, according to Department of Culture, Sport and Tourism.

The demand for meeting, incentive, conference and event tours has also been increasing strongly in recent years. Some travel agents in Ho Chi Minh City welcomed as many as 40,000 to 60,000 MICE guests in the first nine months of 2011.

In related developments, 18, three- to five-star hotel projects will come online in Ho Chi Minh City in the period 2012-2015, adding almost 5,000 rooms to the city’s supply.

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