Average occupancy was over 70%, driven by demand from international visitors, businesses and Meetings, Incentives, Conferences, and Exhibitions tourists, according to a recent report by property consultancy Savills.
Supply remained largely unchanged at around 17,000 rooms but for some marginal increases mainly due to the expansion of some three-star hotels. The market is seeing mostly upgrades rather than new developments, the report said.
Room rates rose even though the number of flights to the city fell by 4% due to higher fuel costs and airfares. In the first six months, the number of foreign visitors jumped by 50% year-on-year to 6.4 million, official data shows.
|
A tourists’ area in HCMC. Photo by Unsplash/Hannah Lazar |
In the upscale segment, real estate consultancy Avison Young recorded average room rates of around VND5 million a night at five-star hotels, with occupancy consistently at 75%-80%.
Average rates at four-star hotels were around VND3.5 million, while occupancy was 72%-78%.
Demand for upscale accommodations remained stable from international visitors and business customers. The limited new supply meant existing hotels did not face much competitive pressure.
Property services firm JLL reported a 19.3% year-on-year increase in revenue per available room at HCMC hotels in the first quarter due to both higher tariffs and occupancy rates.
Savills said HCMC is not expected to see any major new hotel projects this year. By 2029, some 900 new four- and five-star rooms are expected to be added, almost all in the former District 1.
But supply will be unchanged in the short term, helping existing hotels maintain occupancy and room rates.
Analysts said, however, as customers increasingly prioritize brands and service quality, the limited supply might not benefit all hotels, and older properties, self-operated hotels, and those lacking investment could face greater pressure. These would need to renovate or reposition themselves to remain competitive, they added.
Mauro Gasparotti, senior director and head of hotel advisory for Southeast Asia at JLL, said: “The competition is increasingly being determined by quality, brand, and the ability to invest in upgrades.”
Over the medium and long terms, the market is expected to attract more international brands. Avison Young said Caption by Hyatt in the Ba Son area is among the developments to watch.
In 2027-2028, brands including Nobu Hotel Ho Chi Minh City, Four Points by Sheraton and JW Marriott in Can Gio are expected to enter the upscale segment.
According to consulting firms, the hotel industry outlook remains positive, supported by growing international visitor numbers and the recovery of tourism across the Asia-Pacific.
HCMC hopes to attract 61 million visitors and generate about VND330 trillion in tourism revenues in 2026.