Foreign investors comment on Phu Quoc condotel market after hot growth period

Foreign investors always appreciate the potential of the condotel market in Vietnam, but there are still barriers.

Phu Quoc resort real estate market has many advantages to attract investors. (Source: VNA).

Director of Savills Hotels Asia- Pacific Mauro Gasparotti shares about the condotel market in Vietnam, especially in Phu Quoc (Kien Giang province), which has just experienced a period of hot growth.

Mr. Mauro Gasparotti said that Phu Quoc has many advantages to become an international destination. However, most of the supply in the market currently only focuses on providing rooms without paying attention to the customer experience.

The market needs to diversify accommodation products such as hotel projects with design highlights, luxury resorts in the true sense... Choosing the right model and product to suit market conditions and customer needs is an important factor to ensure the successful development of a project.

Taking the Phu Quoc market as an example, the Director of Savills Hotels Asia- Pacific region said that when planning a project, investors need to carefully consider if choosing the shophouse model because there are currently many sources of supply of this product and most of them have not been put into commercial exploitation.

“The impact of factors including project development quality, duplicate models, and lack of sustainable orientation have led to the ineffective operation of this segment in recent times,” Mr. Mauro Gasparotti further analyzed.

Evaluating condotel products in Vietnam compared to neighboring markets with many similarities such as Thailand and Indonesia, Mr. Mauro Gasparotti said that it can be said that if a product is not carefully and meticulously planned, it cannot operate effectively no matter which market it is developed in.

Not only in Vietnam have we witnessed problematic condotel products, some projects in Bali and HuaHin also faced similar "disasters" simply because they were not carefully planned and developed.

In Vietnam, there are also successful condotel products such as Hyatt Regency Da Nang and Melia Ho Tram projects. The common point of these products is that they are all well planned, built and managed, bringing value to investors and owners.

According to Mr. Mauro Gasparotti, some other markets in the Southeast Asian region have also witnessed a period of hot development of condotel products, such as Bali (Indonesia) in 2008 and now this market has passed the "new project boom" phase, instead of slow but quality development.

In general, every market will go through a certain cycle. However, compared to Thailand and Indonesia, the Vietnamese market faces more challenges.

In the recent period, Vietnam has recorded a large number of condotels being launched for sale, especially in the period of 2016-2019 with an estimated average of 12,000 products launched for sale each year. In addition to the large supply, many products launched for sale during this period raced to commit to profits with attractive time and rates, without careful consideration of overall operating results.

According to him, in the face of some barriers for foreign investors, especially regulations and procedures related to project development, investors often tend to look for assets that are already in operation, especially quality hotel and resort projects in the 5-star segment in central cities such as Ho Chi Minh City and Hanoi. However, these assets are often quite scarce in the market, as well as less open to transfer needs.

Sharing about promoting the attraction of visitors, especially domestic tourists, the Director of Savills Hotels Asia-Pacific region said that improving infrastructure is an important premise to promote domestic tourism. The clearest example is Phan Thiet tourism, since the completion and operation of the expressway project has promoted the demand of domestic visitors, especially from the Ho Chi Minh City market when the travel time has been shortened to only 2-3 hours.

To continue attracting tourists, according to Mr. Gasparotti, besides infrastructure, the market also needs to diversify tourism products as well as pay more attention to tourists' experiences and amenities.

Source: https://baoquocte.vn/foreign-investors-opinion-on-the-phu-quoc-condotel-market-after-agricultural-growth-growth-271023.html