Hotels bank on chain reactions

Novotel StarCity Hoi An Resort

Ocean Hospitality, a member of the Hanoi-based Ocean Group, last week held the soft opening of its first hotel development in Vietnam, the StarCity Saigon Hotel in Ho Chi Minh City, with a vision for doing business worldwide.

Located in Phu Nhuan district’s Nguyen Van Troi Street, which links the city’s central business district and Tan Son Nhat International Airport, the four-star hotel will have 200 rooms for business and leisure travellers to the country’s largest city.

Ha Van Tham, chairman of Ocean Group, said: “We aim to make Ocean Hospitality Vietnam’s first branded hotel management firm to go worldwide in the coming years, and the StarCity Saigon Hotel is the first of our StarCity Hotel chains. We plan to develop six to seven hotels in the next three years in Vietnam and raise the number to 20 in the next 10 years, with some to be located in China and Japan.”

According to Ocean Hospitality, there would be more hotels lining up for completion in 2011, including the Novotel Hoi An Resort and the StarCity Halong Hotel. Meanwhile, the StarCity Westlake Hanoi Hotel, the StarCity Nha Trang Hotel and the StarCity Airport Hotel would be completed in 2012.

“Four-star StarCity hotels will be our main chain, as we find it easier and quicker to get returns on our investments into low- to-mid-end hotels, given the fact that it is very demanding and challenging for us to compete in the five-star range worldwide,” said Tham.

“We are going to change the names of our two existing Ocean Hotels in Hanoi into two- to three-star Star-Inn hotels. One more hotel will soon come up at the current Trang Tien Ice-cream Restaurant site near Hoan Kiem Lake.”

Listed on the Hanoi Stock Exchange in October 2010 with 1 billion shares under the code OCH, Ocean Hospitality planned to spare $35 million for hospitality property developments in the future. It earned VND115 billion (nearly $6 million) of pre-tax profits in 2010 and expected to have a 20 per cent on-year growth in its profits in 2011.

“As a part of the Ocean Group, which also owns many properties and a bank nationwide, I am very confident that OCH can easily mobilise enough capital for the large number of StarCity hotels in the coming time through local banks, stock markets and foreign financial institutions,” Tham said.

Meanwhile, Vincom Group’s Vinpearl luxury hotel is also on its way to earning popularity in the domestic market before heading abroad.

Le Khac Hiep, vice-chairman of the Vincom Group (VinGroup), said: “Most Vietnamese hotel brands are in the mid-to low-end levels, VinGroup, however, looks to develop Vinpearl as an extremely luxury hotel brand in Vietnam before becoming known overseas in the next five years.”

Hiep said that besides Vinpearl Nha Trang, two more Vinpearl resorts and hotels would go online in Hoi An and Danang this year.  A six-star Vinpearl hotel would then follow in the next two years at the premium Eden A sitein Ho Chi Minh City, where the group was developing a luxury hotel and commercial complex.

Vietnam recently saw the entry into the market of other domestically-invested hotels such as the A&Em hotel chain, Liberty and Que Huong. They are all fighting to get more exposure in Ho Chi Minh City.