Emerging destinations: Ho Tram and Long Hai

“In the context of the economy still being affected by the pandemic, domestic investors still show optimism and confidence in the market's recovery potential when construction activities or sales of Second Home projects are still being implemented on schedule" - Mr. Mauro Gasparotti, Director of Savills Hotels APAC shared. "In addition to major tourist destinations such as Hanoi, Ho Chi Minh City, Da Nang, Nha Trang, Phu Quoc, we have recently noticed that new destinations such as Ho Tram, Binh Thuan, Hoa Binh..., are also attracting a lot of attention from the market. Savills Hotels will accompany local authorities and investors to introduce and exploit the potential of new destinations, promote tourism and investment activities here".

Savills Hotels apac

Savills Hotels is a specialized division of Savills Group with in-depth experience in the field of Resort Real Estate Development and Investment Consulting. Savills Hotels' consulting team not only understands the regional market but also has many years of practical experience in the real estate market in the host countries.

With the aim of supporting and accompanying the recovery process of the Vietnam Resort Real Estate market in this challenging period, Savills Hotels continues the Espresso Shots program series - Asia Pacific Market News, updating the latest news on emerging destinations in Vietnam.

According to statistics from the local tourism management agency, Ba Ria-Vung Tau welcomed nearly 2.7 million overnight visitors in 2020, a number equivalent to Da Nang while Khanh Hoa only recorded 1.3 million. Mr. Mauro Gasparotti shared: “Previously, tourist destinations accessible by road were the first choice of most people in cities in Europe and the US until the emergence and explosion of low-cost airlines allowed tourists to access further destinations. However, in the current period with the impact of the Covid-19 epidemic, locations near major cities within a few hours have once again become the choice of many tourists”.

Currently, Long Hai and Ho Tram have 19 projects in the 4 and 5 star segment in operation, providing 2,700 rooms to the market. In the next 3 years, a large supply is expected to enter the market with 9 new projects under construction and 5 projects being expanded, estimated to provide about 7,600 rooms.

Based on the latest research by Savills Hotels, 50% of future supply will be managed by international and regional operators, including some brands such as Intercontinental Grand Ho Tram, Holiday Inn Resort Ho Tram, Hyatt Regency Ho Tram, Grand Mercure, etc.

In addition, with a convenient location near Ho Chi Minh City, 90% of new projects develop the Second Home component, providing a variety of products from apartments to resort villas. Having been hidden gems in the past, this area possesses great potential for tourism development with entertainment, sports and health care activities, as well as being suitable for developing a variety of resort types and Second Home products. For new markets, investors will face more risks, and they need to research and plan projects with a longer-term vision to be able to make appropriate decisions. In addition, developing quality products is a prerequisite to attract visitors to the area for stable growth.

“In the last two years, Ho Tram and Long Hai have attracted the attention of international operators, while in the previous few years they were quite cautious in accepting projects in this market. Although Covid-19 has severely impacted the global tourism market, Ho Tram and Long Hai are two of the few destinations that have maintained occupancy and room rates at pre-pandemic levels, and most resorts have even performed better in 2021. In addition, demand for Second Home products has also increased as buyers understand the value of a place to stay near Ho Chi Minh City for a weekend break or a short trip. Accordingly, real estate values ​​have increased significantly, accompanied by an increase in product quality and amenities,” Mr. Mauro commented.

Key infrastructure projects such as the expressway system connecting the region with the Southeast and Southwest regions and Long Thanh International Airport are considered catalysts to promote tourism and investment activities in the region. Phase 1 of the Long Thanh Airport project (expected to be completed in 2025) will become an important transportation channel supporting domestic and international tourism activities, especially the MICE segment.

Mr. Mauro further commented on the tourism potential of Ho Tram - Long Hai: “The current market depends heavily on domestic demand, accounting for nearly 90% of annual visitors. Ongoing infrastructure projects are expected to bring a more diverse source of visitors. The abundance of accommodation types and entertainment facilities, along with casinos and international standard golf courses, will contribute to increasing the competitiveness of the area compared to other familiar destinations. However, in order to exploit the market potential effectively, we encourage investors to carefully study market trends to grasp the needs of the new generation of tourists as well as diversify the types of accommodation. These products require investors to have a clear understanding of the concepts, ideas as well as how to cooperate between related parties to ensure the feasibility and effectiveness of the project. Overall, we remain optimistic about the market potential and expect positive results in the coming time.”

Savills Hotels will continue the Espresso Shots chain with the Mui Ne - Phan Thiet market, an area that is currently being strongly developed with large-scale projects.

Lan Oanh