HCM CITY — With an expanding room inventory and a lot of projects scheduled to launch in the near future, the competition in the upscale hotel market will start to heat up, especially in the five-star segment, according to the 2017 Vietnam Hotel Survey released yesterday.

The survey, done by Grant Thornton Vietnam for the last 14 years, provides financial, operational and marketing information for 2016 from a range of four- and five-star hotels and resorts.

The number of tourists is expected to rise significantly this year after a lull in 2015 and a sharp increase of 26 per cent last year, said Trịnh Kim Dung, director of advisory services at Grant Thornton Vietnam.

Last year the country welcomed 72 million domestic and international visitors, higher than the target of 68.5 million visitors set by the Việt Nam National Administration of Tourism, Dung said at a press meeting yesterday.

"The Vietnamese tourism industry recorded 10 million international visitors and the highest annual increase of two million. As a result, the performance of the hotel industry is expected to improve after a period of stagnation,” she said.

To accommodate the increasing arrivals for leisure and recreation, 41 new 3 to 5-star hotels with more than 8,700 rooms opened their doors last year.

The total number of rooms has increased to more than 420,000, much higher than in neighbouring countries like Malaysia, Laos and Cambodia.

The average room rate of upscale hotels last year saw a 1.3 per cent increase year-on-year to US$88.1.

The rate for four-star rooms was $75, a rise of 3.8 per cent but still far behind the 2014 level.

Five-star rates again dropped slightly to $104.4 from $106.8 in 2015.

Revenue per available room (RevPAR) increased in both star categories: a 10 per cent rise for four-star hotels to $51.4, and 4.1 per cent rise for five-star hotels to $68.7.

The hotel industry last year saw a recovery with occupancy rate increased for high-end hotels.

The average occupancy rose to 67.2 per cent from 61.5 per cent for four-star hotels and to 68 per cent from 62.7 per cent for five-star hotels.

Individual tourists, tour groups and business travellers together made up more than three quarters (77.6 per cent) of total number of guests staying in high-end establishments last year.

“Travel agents and tour operators remained the largest booking channel at high-end properties, accounting for 37.3 per cent of reservations,” Dung said.

This ratio has, however, seen a gradual decline over the years, and fell by 3.1 percentage points last year.

The survey says that with the 4th Industry Revolution affecting all sectors of the economy with many high-end hoteliers are preparing for what is to come as a notable increase was seen was in the application of digital technology by hotels. Last year, 67.3 per cent used it compared to 49.3 per cent the previous year.

Another 18.6 per cent plan to get on the bandwagon this year or the next with those who said they have not made any decision with regard to using digital technology dropped from 23.9 per cent to 15.4 per cent. — VNS