HCM CITY – HCM City’s hotel market, especially the luxury segment, is attractive to investors due to the relentless rise in tourist numbers.

The city People’s Committee reported that in the first five months of this year there were over 3.2 million foreign arrivals compared to 2.5 million in the same period last year.

The tourism sector’s revenues rose by 14.8 per cent year-on-year to VNĐ51.6 trillion (US$2.2 billion).

Đại Tá Hoàng Vũ, director of the city Department of Tourisms told Việt Nam News that while the numbers of both domestic and foreign visitors are increasing sharply, the city has too few five-star and three-star hotels.

“With annual growth of 20 per cent, the city tourism sector will receive around 10 million foreign visitors by 2020 and need around 10,000 luxury hotel rooms.”

Nguyễn Trọng Thức, head of hotel services, CBRE Vietnam, said the number of foreign visitors coming to HCM City would increase thanks to policies like e-visa and visa waiver, and this would create more demand in the luxury hotels segment.

Many investors and funds want to invest in the city’s hotel market, he revealed.

Many of them are buying old hotels and renovating them, he said.

But there is no new supply, expect for the Mai House which should open by the end of this year, he said.

He told Việt Nam News that the four-star segment would see intense competition from the many new luxury apartments that are being built and let out to guests through Airbnb and other similar services.

The city is encouraging investment in the luxury hotel segment, he said.

It would assist them by streamlining procedures, apprising them about plans and others with an eye on promoting tourism, he said.

Development under way

Last month Mandarin Oriental announced plans to build a five-star hotel at the Union Square Saigon building situated in the block between Nguyễn Huệ, Đồng Khởi, Lê Thánh Tôn, and Lê Lợi streets.

Scheduled to open next year, it will have 228 rooms, six restaurants and bars, a spa, and an outdoor pool.

Swiss-owned Mövenpick Hotels & Resorts has announced plans to develop a new property with 815 keys – 288 hotel rooms and 527 serviced apartments – besides several upscale business and leisure facilities.

Scheduled to open in 2020, the project will form the centrepiece of the Kenton Node Hotel Complex, a major mixed-use development currently rising on the Rạch Đỉa River bank on Nguyễn Hữu Thọ Street in Saigon South.

In addition to these two projects, the Department of Tourism said many other luxury hotels are also planned in HCM City.

Without disclosing the exact number of investors who have applied for licences, he said by 2020 there would be enough luxury hotels to meet 70 per cent of demand. VNS