Regional markets in Vietnam are starting to see outsize pickup in demand following a year that didn't necessarily bear the fruits of optimism from Vietnamese hoteliers.
Speaking on the latest episode of the Hotel News Now podcast, Jesper Palmqvist, STR's senior director of Asia-Pacific, said while the bigger markets in the country such as Ho Chi Minh City and Hanoi are performing all right, it's the regional markets such as Phu Quoc, Cam Ranh and Nha Trang that are seeing hotel demand increases. Phu Quoc, for example, has seen more than 60% growth in topline hotel performance year over year.
There's great interest to open hotels in Vietnam right now. This is exemplified by the country's hotel pipeline, which is the largest in the Southeast Asia region, he said. Vietnam is setting new records in foreign direct investments and its government announced new cost-cutting exercises.
"A lot of changes happening, but like any country here, you need airlift," Palmqvist said. "You need flights to work both domestically and internationally, and that's one thing where they're a bit behind, but generally a positive vibe and a big step forward for Vietnam."
Another market of note for Palmqvist is the Philippines. Hoteliers in the country believe the best is yet to come in regard to hotel demand, but Palmqvist said international arrivals and tourism remains "low and slow," keeping it behind other countries in the region.
"Arrivals are lower than they should [be], and the pace of growth is lower," he said. "It makes you then look at domestic like in Malaysia and Indonesia, and domestic is not growing at the same speed as elsewhere."
Thailand has been one of the quickest-growing markets in terms of tourism in the region, with cities such as Bangkok, Phuket and Chiang Mai as the main drivers of demand.
"It was a good peak season that has just passed. We're seeing a little bit softer [demand] right now, but the long-term view is still that Thailand is strong," Palmqvist said.
Other topics discussed on this week's episode include:
- The appeal of branded hotels in Vietnam.
- Additional hurdles the Philippines face to growing tourism demand.
- Debunking "The White Lotus" effect in Thailand.