Between 2022 and 2023, supply is also expected to increase with the entry of 2,900 rooms, demonstrating the rekindling of investor confidence in the hospitality sector. (Photo: baodantoc.vn) Domestic travel boomed in early 2022, thanks to Lunar New Year travel.
According to the Vietnam National Administration of Tourism, there were morethan 6.1 million domestic tourists during the nine-day festival, generatingrevenue of 25 trillion VND. These numbers represent a genuine demand and anoptimistic outlook for the revival of domestic tourism.
Matthew Powell, Director of Savills Hanoi, said: “Northern Vietnam has aninteresting hospitality market. Apart from thriving tourist destinations like HaLong, we are witnessing development in Hanoi’s suburbs and surroundingprovinces like Hoa Binh and Thanh Hoa.”
“This trend is understandable, given that transportation links to these areascontinue to improve, as such, people can easily travel to surrounding provincesfor weekend trips.”
“While domestic travellers currently drive Vietnam’s hospitality sector, wecannot forget how important foreign tourists are for the market. There arepositive signs though, as Vietnam’s vaccination rate is high and authoritiesplan to reopen the borders to international travellers from mid-March,” headded.
As part of Vietnam’s plan to reopen to international guests, the authoritieshave announced that international flights will resume from March 15, 2022. Thisreopening will not only benefit the country’s tourism and hospitality segmentbut is forecast to benefit serviced apartments too.
Foreign experts are the predominant occupiers of serviced apartments in Hanoi.
Japanese and Korean expatriates are the main tenants in Grade A servicedapartments, accounting for 84 percent in the second half of 2021.
Neil MacGregor, Managing Director of Savills Vietnam, said: “There is a strongcorrelation between foreign direct investment (FDI) flows and servicedapartments. As such, it is no surprise that countries leading FDI investments,such as Japan and the Republic of Korea, also drive serviced apartment demand.”
“In 2021, many international experts could not enter Vietnam due to strictborder controls; however, once international flights resume, many foreignexperts will be able to return, which will greatly enhance tenant pools forserviced apartments.”
According to a 2021 Global Buyer Survey, good healthcare, air quality, andgreen spaces are top priorities when selecting accommodation. As such, brandedserviced apartments could take full advantage of global health initiatives thatthe brands rolled out, collaborating with sanitisation experts to create saferand healthier projects.
Currently, the outlook for hotels and serviced apartments is good, with theborders set to open in the middle of March. However, both sectors will continueto rely heavily on how well the pandemic is managed and the authorities’strategies to do so, Savills Vietnam reports.
After two dormant years, tourism in Vietnam is slowly coming back to life.After social distancing restrictions eased in October 2021, Vietnamese airlinescompleted 8,383 flights in December, 538 percent more than the 1,311 flights inSeptember.
Hotel occupancy also improved in the last quarter of 2021, along with theaverage room rate, which reached VND1.8 million, increasing 12 percent comparedto the last quarter of 2020.
Between 2022 and 2023, supply is also expected to increase with the entry of2,900 rooms, demonstrating the rekindling of investor confidence in thehospitality sector, according to Savills Vietnam./.
VNA
