A new growth cycle beckons for Vietnam’s hospitality market, driven by investment shifts, lifestyle trends, and a renewed focus on talent.

After years of disruption
following Covid-19, Vietnam’s hospitality market is now regaining its balance. Domestic
travel has stabilized after an early post-pandemic boom, while international arrivals,
led by China and South Korea, are climbing back quickly. Hotels around the country
are posting stronger occupancy and higher room rates, supported by growing confidence
and renewed investor attention. Mr. Mauro Gasparotti, Senior Director and Head of
Southeast Asia at Savills Hotels, told Meet the Experts (MTE) Hanoi 2025 that “This
is the year every hotel owner has been waiting for – finally, a year to make money.”

Regaining its footing

From rapid expansion
to sudden contraction and now measured recovery, Vietnam’s hospitality market has
come full circle. Prior to the pandemic, the country boasted one of the world’s
largest hotel pipelines, with new projects growing by around 30 per cent each
year, Mr. Gasparotti said. This wave of supply outpaced demand, cutting into profitability
even as visitor numbers rose.

Over the past few
years, however, growth in new supply has slowed to some 5 per cent, giving hotels
space to breathe and improve occupancy. Future growth is expected to remain below
10 per cent; a healthy level that aligns better with rising demand and expanding
infrastructure. “This is the moment when foreign investors start to look at Vietnam
again,” Mr. Gasparotti believes.

The structure of
the market is also shifting. Eight of the largest Vietnamese developers, including
leading groups such as the Sun Group and BIM Group, account for nearly one-third
of total new supply, mirroring patterns seen in more mature tourism markets like
Thailand. However, several large projects remain on hold as developers refine strategies
and financing plans, leading to a more deliberate, sustainable pace of development.

Geographically,
though, growth has been uneven. Coastal destinations like Phu Quoc Island off
the coast of the Mekong Delta and central Da Nang city continue to absorb most of
the new inventory, while urban centers such as Hanoi and Ho Chi Minh City are under-supplied.
“Hotels in Ho Chi Minh City are getting older,” Mr. Gasparotti pointed out. “There
have been a few renovations this year, but we need much more.” With limited new
projects in the pipeline, the city stands out as one of the most promising investment
opportunities in the years ahead.

In terms of segmentation,
early-developed destinations such as Mui Ne and Nha Trang along the
south-central coast remain focused on the midscale market, while newer hotspots
like south-central Cam Ranh province, Phu Quoc Island, and Da Nang lean towards
upscale and luxury developments. The next phase of growth, Mr. Gasparotti suggested,
will depend on diversification – not just building more hotels but the right ones
in the right places.

Beyond traditional hospitality

Inside Vietnam’s hospitality boardrooms, the conversation has changed. The
focus is no longer on reopening, it’s on reimagining. Across brands and destinations,
hotel leaders are recalibrating portfolios for a more resilient, experience-driven
era.

For leading developers like the Sun Group, the last 12 months marked a period
of bold expansion. Mr. Daniel Trinh, its Chief Business Development Officer, said
the group had entered new business segments, including aviation, as part of its
broader strategy to integrate travel and hospitality. Phu Quoc Island remains its
anchor destination, where it is developing Southeast Asia’s first all-inclusive
resort with Accor, set to open in 2026.

Currently operating 18 hotels and resorts, the Sun Group plans to triple its
portfolio to 65 properties by 2030. Beyond scale, it is also adapting to the shifting
demographics of travelers. “We’re entering lifestyle hospitality, from luxury lifestyle
to economy,” Mr. Daniel noted, pointing to new partnerships with brands such as
Marriott and Hilton.

Meanwhile, Ms. Carolina Fagnani, Vice President of Development, Southeast Asia
and Pacific, at the Radisson Hotel Group, described 2025 as a year of acceleration,
with delayed projects now moving forward and confidence returning among investors.
Radisson itself has added lifestyle offerings, with Radisson RED Da Nang and Radisson
Resort Mui Ne, while continuing to expand its development pipeline.

The Masterise Group, traditionally known for luxury residences, is taking a
long-term view on hospitality. Ms. Nelly Phuong Ta, Head of Hospitality and Entertainment,
said Masterise is now focused on building branded living lifestyles across its portfolio,
not just branded residences. With 1,400 hotel keys signed and its first properties
under construction, Masterise plans to debut hotels in 2027 and 2028, targeting
the premium and ultra-luxury segments.

For TT Hospitality, the past year has been about restarting momentum.
Acting CEO Ms. Thuy Le said that after years of limited progress, “there has been
a lot of positive change.” The company is now actively signing management agreements
with major international operators, including Marriott, and targeting the opening
of around ten hotels within the next two years.

The BIM Group has also posted strong performance, with revenue rising 24 per
cent since 2019. During the past year, it has opened the InterContinental Halong
Bay, Holiday Inn Vientiane, and Soul Boutique Hotel on Phu Quoc Island, with Park
Hyatt Phu Quoc set to follow next year. However, Mr. Adam Riley, Head of Hospitality,
highlighted a key market shift that caught many off guard: the surge of Chinese
travelers to Vietnam. This development, he said, underscores how quickly regional
dynamics can change and how essential it is for operators to adapt swiftly.

Game-changing year ahead

As
Vietnam’s hospitality industry looks towards 2026, the conversation turns from recovery
to readiness. The next 12 months promise not just expansion but a deeper focus on
data, talent, and long-term sustainability.

For
the BIM Group, next year is about intelligence and insight. “We’ve been developing
our business intelligence system over the past three years,” Mr. Riley said. “We’re
looking 365 days into the future, exploring how to use AI for predictive insights,
and integrating food and beverage data into that system.” Yet alongside technology,
he voiced growing concern about people. With Phu Quoc Island and other destinations
preparing to welcome thousands of new rooms, talent retention has become a pressing
issue. “Staff turnover is over 20 per cent across our estate; that’s starting to
keep me awake at night,” he admitted.

At
TT Hospitality, growth remains the priority. Ms. Le shared plans to operate
ten hotels by 2026 while expanding TT’s travel ecosystem through Vietravel
Airlines. “We expect to open more flight routes to support tourism and grow our
branded residence portfolio,” she said.

Meanwhile,
Ms. Nelly from the Masterise Group predicted that 2026 will mark a game-changing
phase for the entire sector. The upcoming APEC 2027 Summit on Phu Quoc, she noted,
is already driving infrastructure upgrades. “New metro lines and high-speed rail
will change our lives, and Vietnam’s travel industry, forever,” she said.

For
international brands like the Radisson Hotel Group, Vietnam’s challenge is to turn
new visitors into repeat guests. “Only 2-5 per cent of tourists return,” Ms. Fagnani
noted. “If we can reach 8-10 per cent, that’s when we can say Vietnam has become
a repeat destination.”

Mr.
Daniel linked all these ambitions under one theme: sustainability through talent
and infrastructure. “We’re launching the Sun Hospitality and Sun Aviation Academies,
in partnership with EHL and CAE, to meet future demand,” he said, adding that the
group is also developing Phu Quoc International Airport’s Terminal 2 ahead of APEC
2027.

Together,
these priorities point towards a maturing hospitality market, one that’s embracing
data, building ecosystems, and preparing its people for the next stage of Vietnam’s
tourism story.

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