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Vietnam Business » Vietnam Real Estate Market News » High-Class Hotels Face Difficulties in 2010

High-Class Hotels Face Difficulties in 2010

For the hotel operators, 2009 was a difficult year due to long-term negative effects from the global financial crisis from 2008, with reductions in room rates, occupancy, and profits.

Grant Thornton Vietnam Co Ltd, a licensed accounting, auditing and consulting firm has released the hotel survey 2010, a statistical report presenting financial, operational and marketing information from Vietnamese hotels and resorts, ranking from three to five stars in 2009.

According to the survey, the average annual room rates in Vietnam decreased by 31.9 percent but 4.3 percent decrease in average occupancy rates from 2008 to 2009.

Kent Atkindon, Grant Thornton Vietnams chef of executive (CEO) said year 2009 was the mopst challenging year for Vietnams hospitality industry. The number of foreign visitors to Vietnam dropped by over 11 percent and the room rates fell considerably in almost all types of hotels. The average room rate in five-star hotels slumped by 33.5 percent, in three-and four-star hotels down 2.9 percent and 12.1 percent respectively. The occupancy rates in five-star hotels decreased by 6.3 percent and four-star hotels down 14.1 percent. On the contrary, the occupancy rates in three-star hotels actually increased by 2.1 percent, showing that the movement in customer demand during the year was towards the less expensive categories.

RevPAR index, the standard industry measure of hotel utilisation and return, showed an overall decrease from $68.5 to $44.63 in 2009, down 34.8 percent. The majority of this decreasing trend was from group of five-star hotels with reduction of 37.7 percent. Meanwhile, RevPAR for four-star hotels declined by 24.3 percent and RevPAR for three-star hotels increasing by 0.9 percent, reflecting the more resilient nature of the medium hotels during the year.

As for the room occupancy rates, HCM City fell from the top position and Phan Thiet moving to the top. Among the selected cities for conducting the survey, Hoi An City was the most improved one with an increase of 28.8 percent. However, Da Lat City lowered by 19.2 percent.

The room rates also showed much difference, with majority of the hotels in HCM City and Hoi An declined, while Da Lat and Phan Thiet experienced sharp increase.

In Vietnam, the high season usually starts in mid September and lasts until the end of March of the coming year. The fact that the number of tourists visiting Vietnam to enjoy the dry season increase significantly resulted in the room rates and occupancy rates.

In details, the average room rates for three to five-star hotels at the peak time in 2009 was posted at $80.46, dropping by 39.5 percent against the previous year, and occupancy rates at 68 percent, a fall of 3.5 percent from 2008.

Vietnam Business And Financial News Network. Source [stox.vn]

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