Outlook bright for hospitality and real estate market

Outlook bright for hospitality and real estate market

Following a highly positive year for Vietnam's hospitality market, marked by a strong rebound in tourist arrivals, the sector is now poised for further advancements.

Following a highly positive year for Vietnam’s hospitality market, marked by a strong rebound in tourist arrivals, the sector is now poised for further advancements.

Meet The Experts Ho Chi Minh City 2025 will be held on March 18 at the Landmark 81 Autograph Collection Hotel

Vietnam’s tourism industry continues to gain momentum, supported by favourable visa policies, enhanced tourism infrastructure, and strategic marketing efforts by local authorities and businesses. Its reputation as a welcoming and safe destination further strengthens the country's appeal.

In 2024, Vietnam welcomed nearly 17.6 million international arrivals, a 39.5 per cent on-year increase, finally reaching pre-pandemic levels from 2019.

Asian markets continue to dominate as the key sources of inbound tourists. South Korea remained the leading source market for the third consecutive year, contributing nearly 4.57 million visitors. Meanwhile, China’s tourism market rebounded significantly, ranking second with 3.74 million arrivals, a 114.4 per cent on-year increase, albeit this figure still lags far behind 2019.

Mauro Gasparotti, senior director, head of SE Asia Hotel Advisory, Savills Hotels, and creator of the Meet The Experts (MTE) series, commented that 2024 was a strong year for tourism.

“Ho Chi Minh City and Hanoi led the country in tourism revenue. At the same time, key coastal destinations such as Nha Trang–Cam Ranh continued to see significant growth in accommodated international arrivals, increasing by 125 per cent. Phu Quoc also experienced a significant tourism surge in the final months of 2024, fuelled by the growing number of direct international flight routes. This momentum is expected to continue, especially as Phu Quoc has been selected as the host city for the APEC Summit 2027,” Gasparotti said.

Ho Chi Minh City’s hotel market demonstrated a strong recovery in 2024, with a solid performance in both occupancy and room rates. On the supply side, the number of new openings in the upper-mid scale and above segments is very limited, while tourist arrivals have grown at a double-digit rate. This indicates that Ho Chi Minh City still has room for further supply expansion.

Uyen Nguyen, head of consultancy at Savills Hotels, shared that infrastructure developments are reshaping the hotel landscape in Ho Chi Minh City.

“Once Long Thanh International Airport and its metro connection are completed, the city will become even more accessible for domestic and international travellers. This enhanced connectivity will likely encourage longer stays and increased hotel demand in non-CBD locations, while strengthening the city’s MICE (Meetings, Incentives, Conferences, and Exhibitions) tourism sector. Hotels near metro stations, particularly in key commercial and tourist areas, are likely to see increased demand potential for higher room rates. As a result, new hotel developments may cluster around major metro stops,” said Nguyen.

Regarding capital markets, Vietnam attracts strong interest, particularly from Asian investors and family offices. However, the number of transactions remains limited due to ownership complexities, regulatory challenges, and prolonged negotiation processes.

Properties in key cities with prime locations and strong infrastructure connectivity are the most sought-after, as investors prioritise assets with long-term value appreciation and stable demand. The evolving legal landscape and upcoming infrastructure projects may further shape investment trends, potentially unlocking new opportunities in the hospitality and real estate sectors.

Gasparotti noted that the hospitality market has demonstrated remarkable global growth, resilient to crises and an excellent sector for future investment and development.

“Emerging technologies, such as AI, are set to revolutionise travel by simplifying processes and personalising experiences for both leisure and business travellers. Now is the perfect time to reassess the industry as a long-term investment opportunity,” he added.

Products such as branded residences, ultra-luxury residential developments, rooftop bars, beach clubs, wellness resorts, and exclusive membership clubs exemplify the seamless fusion of real estate and hospitality, and will be discussed at the incoming MTE. These concepts will drive the next evolution of Vietnam’s real estate and hospitality industry, with more top-tier brands expected to enter the market.

Additionally, Vietnam may see an increase in branded residences within the upscale segment, a distinctive trend compared to other markets. While this diversification enhances offerings for buyers, it also presents risks; projects that fail to meet brand standards could negatively impact buyer perceptions of branded residences.

“The MTE conference aims to strengthen connections among hospitality and real estate players, foster collaboration, and provide valuable insights to developers, hotel owners, and industry partners—empowering them to seize opportunities and prepare for the next cycle in the real estate and hospitality markets,” Gasparotti emphasised.

This highly anticipated event will take place in Ho Chi Minh City on March 18 at the Landmark 81 Autograph Collection Hotel. The conference will offer a platform for foreign investors to connect with local stakeholders and gain market insights. This year’s topics will cover Vietnam’s real estate and hospitality landscape, investment opportunities, risks, wellness, sustainability, ultra-luxury, and emerging technologies that are shaping the industry.

Beyond the main conference sessions, MTE Ho Chi Minh City 2025 will feature an experience room showcasing hotel technology, the HoSkar Night networking event, food and beverage experiences, and various activities on the second day. These immersive experiences will give attendees practical insights, valuable connections, and collaboration opportunities.

VIR