Hanoi, Saigon plan hotel expansions as foreign arrivals continue to rise

Foreign arrivals in Vietnam continued to surge in May, and the hospitality sector in Hanoi and Ho Chi Minh City already has plans to prepare for more.

Vietnam received nearly 973,000 foreign tourists in May, up 27 percent from a year ago, according to figures from the General Statistics Office.

Arrivals increased from all major markets including those with visa exemptions such as Japan, Russia, South Korea and Western European countries, except for France whose arrivals dropped 2.5 percent from the same period last year.

China accounted for a third of all tourist arrivals, while visitors from South Korea rose 67 percent on-year.

By the end of May, foreign visitors to Vietnam had increased almost 30 percent to nearly 5.26 million, said the office.

Megacities Hanoi and Ho Chi Minh, the country’s biggest tourist destinations, expect further growth in the coming years with a lot of expansion planned in the hotel industry.

According to the Hotel Destinations – Asia Pacific report released this week by the JLL Hotels & Hospitality Group, the cities plan to continue promotional efforts in Japan and target further growth from France, India and Russia.

Hanoi, where foreign tourists grew 13 percent to 1.73 million in the first four months of this year, is expected to add more than 800 branded hotel rooms by the year end and another 2,000 rooms by 2020, 60 percent of which will be in the luxury segement, the report said.

Real estate consultancy firm Savills last month said Hanoi’s hotel occupancy increased seven percentage points to 74 percent of its 9,200 hotel rooms in the first quarter. Hotel room rates during the period also increased a staggering 41 percent from a year ago to $156 a night for a five-star room.

Eyeing a 15 percent increase of foreign arrivals to six million this year, Ho Chi Minh City also plans to add 1,000 rooms by the year end and another 2,500 in the next three years, said the JLL report.

Hanoi and Ho Chi Minh City were named among the fastest growing tourist cities by MasterCard last September, and many travel sites say they are ideal destinations for backpackers.