Hanoi will see a surge in new hotel projects, mainly managed by international brands, which is expected to improve service quality and provide a wider array of options for travelers, according to the Q3 2024 report released by Savills Vietnam.
The report shows that 68 new hotel projects will add 12,115 rooms to the market. In particular, one five-star hotel is scheduled to open in 2024, contributing an additional 207 rooms.
From 2025 to 2026, Hanoi's hotel market is expected to offer 3,035 rooms from 12 new projects, with five-star hotels dominating supplying 77% and four-star hotels accounting for 23%.
Savills' analysis shows that the city will account for 41% of the total new supply, representing 5,027 rooms from 22 projects. International brands such as Hilton, Fusion, Accor, and Four Seasons will manage 66% of the new inventory, while local companies will run the remaining 34%, providing travelers with diverse brand options.
Domestic tourism up, rentail prices down
| L7 West Lake Hanoi, a five-star project, is invested by Lotte. |
The report revealed that Hanoi's hotel market saw no new projects in Q3, with rental rates falling slightly due to promotional campaigns aimed at attracting guests amid a surge in domestic tourism.
Current supply remains stable at 11,120 rooms in 67 projects, mainly concentrated in the urban area with nearly 5,500 rooms, 59% of which are in five-star hotels.
The supply of five-star hotels increased by 8% year-on-year, while the four-star segment declined by 7% following the rebranding of Eastin Hotel & Residences to Movenpick Living West, which was upgraded to five-star status.
The average rental price in the third quarter reached VND2.7 million ($106.8) per room per night, a 2% decrease from the previous quarter.
Matthew Powell, Director of Savills Hanoi, explained that the decline in hotel rental rates is largely because Q3 is a low season for tourism and leisure activities. To counter this trend, many hotels have launched promotional programs and travel packages to attract visitors in the fall, in line with the Ministry of Culture, Sports and Tourism's efforts to boost domestic tourism.
He added that these activities have contributed to positive growth in the tourism sector, with Hanoi's total revenue reaching nearly VND81.9 trillion ($3.5 billion), an increase of 18.5% compared to the same period last year. In the first nine months of the year, Hanoi welcomed 21.1 million visitors, up 11.7% year-on-year, including 4.4 million international tourists (up 40.8%).
However, despite the overall positive outlook for the tourism industry, the performance of the hotel market remained stagnant in Q3, with an occupancy rate of 67%. This figure has not changed from the previous quarter, but has increased by six percentage points compared to the same period last year, the director said.
Last year, Hanoi welcomed the reopening of Movenpick and the upcoming openings of Hilton and Fusion, all five-star hotels. Other notable five-star projects include Lotte's L7 West Lake Hanoi, Dusit Tu Hoa Palace, The Ritz Carlton, Four Seasons, Waldorf Astoria Hanoi, and Fairmont.
