Hotel occupancy, room rates rebound after COVID
VIETNAM, August 29 – HCM CITY – The global hotel and resort industry is recovering well from the COVID-19 pandemic with improvements on room occupancy and rates, and Việt Nam is not doing exception, said Mauro Gasparotti, director of Savills Hotels Asia Pacific.
The performance during the summer vacation period suggests a positive outlook.
Coastal localities such as Bà Rịa-Vũng Tàu, Hồ Tràm, Đà Nẵng, Nha Trang and Phú Quốc fared well, largely due to the return of domestic travellers. The occupancy rate reached 50 to 70% in some stations.
However, for performance to reach 2019 levels, international arrivals need to fully recover, Mauro said.
Three factors are hampering the recovery of tourism, including inflation, rising flight costs and continued disruptions in key source markets such as China and Russia.
“We expect a full recovery in demand by 2024. However, Việt Nam’s tourism industry also faces the challenge of oversupply. Over the next three years, supply in major tourist destinations is expected to grow at an average rate of 20% per year. At this rate, if demand does not increase, it may lead to oversupply, which will impact occupancy,” he said.
There is great potential for resort real estate in Việt Nam, as the country saw the highest increase in international arrivals in Southeast Asia between 2009 and 2019 at 16.9% per year.
The supply of mid-range to luxury rooms has increased to 94,000 this year from 14,000 in 2009.
“To place Việt Nam firmly on the international tourism map, agencies, investors and professional consultants must cooperate to deliver quality projects that reflect changing market demands and local characteristics. This is essential for long-term sustainability,” Mauro said.
In Asia-Pacific, hotel occupancy has been decimated by the pandemic and has ranged from 25-40% in major destinations since 2020. However, the market has been on the rise since the second half of 2021, following successful vaccination campaigns across the region, which gave confidence to investors.
According to Savills Asia Pacific Hospitality Spotlight released in June, hotel investment volumes reached US$14.9 billion across 459 deals in 2021, surpassing the pre-pandemic five-year average of US$14.6 billion.
The market saw a slight uptick in investment volumes and number of deals in 2021, up 42.1% YoY and 25.8% YoY, respectively. —VNS