09:57 | 05/09/2018 Economy
More than half of five-star hotels in HCMC and Hanoi are owned by foreign investors.
|There were 118 five-star hotels/resorts in Vietnam in 2017, almost twice the number in 2013 - Photo: Vnexpress|
Ten out of 19 five-star hotels in the best locations in HCMC have foreign owners, according to VnExpress data. They include Sheraton, Caravelle, InterContinental, Asiana Saigon, and Sofitel.
Many of the foreign investors came to the country in the last two decades and first began by partnering local firms.
One of them, Singapore-based Glynhill Investment Vietnam, established the US$61.5 million Caravelle together with travel agency Saigon Tourist in 1992.
In 1994 Lam Ho Investments, another Singaporean firm, signed a deal with Saigon Tourist to build the Sheraton hotel at a cost of US$97 million.
UOL Group, one of Singapore’s top real estate firms, picked up a 26 percent stake in the five-star Sofitel Saigon through its subsidiary, the Pan Pacific Hotel Group.
Hong Kong investors also own stakes at premium hotels in HCMC. One of them, Keck Seng Investments, has a 64 percent stake in the Sheraton and 25 percent in Caravelle.
Koreans, late entrants in the market, have been making major acquisitions in the last five years.
In 2013 Lotte Hotels & Resort bought a 70 percent stake in the Legend Hotel from Japan’s Kotobuki Corporation. Lotte also manages the hotel, which overlooks the Saigon River. The company considers the hotel the first step in its expansion into Vietnam and Asia.
In Hanoi, VnExpress found that nine of 16 five-star hotels have foreigners as major shareholders.
They have been investing in the sector for decades, with Hanoi Westlake, Melia, Sheraton, Daewoo, Nikko, and Pan Pacific being the major names.
Malaysia’s Berjaya Corporation Berhad owns 75 percent of InterContinental Westlake and 70 percent of Sheraton.
Other Korean firms own stakes in Lotte, Intercontinental Hanoi Landmark 72 and Grand Plaza.
Vo Quoc Phuong Trang, head of Investment Consultancy, told VnExpress that international firms usually seek to own major stakes to enable them to take part in the hotels’ development and management.
Hanoi and HCMC, with their steady economic and tourism growth, would continue to draw foreign investors in the high-end hotel segment, which has low risk but offers steady revenues, she said.
As of last year there were 118 five-star hotels/resorts in Vietnam, almost twice the number in 2013.
They had an occupancy rate of over 75 percent, 5 percentage points up from 2016, according to global consulting firm Grant Thornton.