Hospitality attracts foreign investors

14:24 | 02/10/2016 Economy

(VEN) - Vietnamese five-star hotels and resorts have become an attractive destination in the eyes of foreign investors. CBRE Hotels in Asia-Pacific Executive Director Robert McIntosh talked about the issue in an interview with Vietnam Economic News’ Minh Long.

Hospitality attracts foreign investors

The CBRE forecasted that the Vietnamese hospitality will be flourishing in the coming time. Why?

The number of international tourists visiting Vietnam in the first half of this year increased by 21 percent, while hotel occupancy rates increased by 65 percent in Ho Chi Minh City and 75 percent in Hanoi as of June 30 compared to a year ago. The rate in Hanoi was the highest in the last five years, competing with Bangkok for the top position in the Southeast Asia region.

Mergers and acquisitions (M&A) deals in Vietnam’s hotel segment have also recorded a significant increase. Although the value of M&A deals in its field only reached around US$100 million in 2015, this figure increased by two times in the first half of this year, meaning that foreign investors have confidence in Vietnam’s hospitality and tourism market.

Some of the world’s top hotel chains such as AccorHotels Group, InterContinental Hotels Group, Marriot International, Hilton Hotels & Resorts and Starwood Hotels and Resorts Worldwide continue to pour their investment capital into Vietnam, while others such as Wyndham Hotels and Resorts, Holiday Inn and Pan Pacific Hotels and Resorts also plan to enter the local market.

What advantages has Vietnam had to attract foreign investors?

Vietnam has been seen as a safe destination, while exchange rates have benefited foreign visitors. These factors have opened up opportunities for Vietnam to attract more tourists.

Vietnam has also recorded impressive growth in terms of hotel occupancy rate, while countries in the region have seen a fall, such as Indonesia from 70 percent to 57 percent in the last few years.

Supplies of five-star hotels and resorts in Vietnam have also witnessed lower growth compared to regional countries. In the next four years, supplies in Kuala Lumpur and Jakarta will increase by 30 percent and 25 percent, while this figure will be 15 percent in Hanoi and 8 percent in Ho Chi Minh City.
Revenues from Vietnamese five-star hotels and resorts have seen the highest level in the Southeast Asia region.