Factors affecting the resort real estate market

Mr. Le Minh Dung - Deputy General Director of BIM Group

As one of the large enterprises developing resort real estate, in your opinion, what factors will affect this segment in 2018?

The core factor driving the development of resort real estate is still the potential of Vietnam's resort tourism. In recent years, tourism statistics have always shown very impressive numbers, especially 2017 which is considered a record year for Vietnam tourism with the number of international visitors reaching nearly 13 million.

A new feature of the tourism industry in the past year is that domestic tourists are increasingly showing a significant increase in spending ability. If about 5-10 years ago, people mainly chose budget motels or 2-3 star hotels to rest when traveling, now it is very common for domestic tourists to stay at 4-5 star luxury resorts. This has a huge impact on the resort real estate market; 73 million domestic tourists every year is an extremely attractive piece of cake for investors.

Entering 2018, experts assess and expect that Vietnam tourism will continue to grow thanks to the development and proliferation of low-cost airlines, technological improvements in the tourism industry, visa exemption policies as well as the increase in tourism demand in the context of economic development and high per capita income.

In addition, other factors that can positively impact the resort real estate market include the stability and development of the macro economy; the rapid increase of the middle-income and high-income investor segment; and the legal corridor that may soon have positive developments.

Regent Residences Phu Quoc project stands out from investor BIM group in 2017.

So what is your forecast for the resort real estate market in 2018?

With the strong development of tourism, the resort real estate market will certainly continue to be vibrant in 2018. The profit commitment policy will still play a key role in attracting individual investors. However, I predict that next year, customers will be more cautious with these commitment rates and may look towards the real value of the resort product.

At the same time, through the development and selection process, the market as well as investors will certainly become more professional and strict with investment products. Therefore, the market will have less room for small projects, inexperienced investors, unclear development potential, instead, projects with professional international management units, reputable investors, clear synchronous planning will be more preferred.

There are many opinions that the number of condotel apartments is in excess, what is your opinion on this statement?

I agree that in the whole market, the supply of condotel apartments is currently very large and has shown hot growth in recent years. However, there are a few points that I think are worth noting in this aspect:

The hottest and gradually showing signs of saturation are the two cities of Nha Trang and Da Nang with many projects being launched for sale, many of which have up to several thousand apartments. In these cities, the hotel supply is already very large, so the above number of apartments can lead to oversupply in the medium term. Meanwhile, in emerging markets such as Ha Long, Phu Quoc, Vung Tau... although the growth is quite strong, I believe there is still a lot of room for development.

Besides, in my personal observation, the number of truly high-quality condotel products is still quite limited. Projects that ensure 3 factors: Developed by a reputable investor; Managed and operated by a reputable and trustworthy unit; Located in a well-planned and visionary resort complex will certainly still have a solid position in the market.

InterContinental Phu Quoc Long Beach Resort & Residences project invested by BIM Group is about to open for operation.

What is BIM Group's strategy in developing resort real estate in the coming time, sir?

The top and only principle of BIM Group is to bring the best real estate products and investment opportunities to customers. In the field of resort real estate, in the near future, BIM Group will pursue 3 core goals and strategies:

Continue to focus on emerging markets with much room and potential for development, such as Phu Quoc and Quang Ninh. With great advantages in tourism and long-term vision, these two locations will certainly reap more success and attract more investment, soon on par with Vietnam's tourism capitals such as Da Nang and Nha Trang.

Diversifying the product and project portfolio is also a very important goal of BIM Group. Our resort real estate products will target many customers in different segments. The highlight of our short-term plan is to enable mid-range investors to own their own high-end second home.

In addition, BIM Group will continue to cooperate and seek reliable domestic and foreign partners in managing and operating hotels and resorts. A large part of the success of our recent projects comes from this cooperation and this is also the highlight of BIM Group in the current resort real estate market, bringing confidence to customers and investors.

Ngoc Anh - Dung

The Thanh