Resort investment on the rise with post-pandemic prospects

July 07, 2021 | 16:23
Though the tourism industry has been hit hard, project developers and financiers are preparing for the comeback of the industry. Many investors of small- and medium-sized ventures are now looking into combined service projects, instead of focusing on the hospitality sector or individual products like before.
Resort investment on the rise with post-pandemic prospects
Resort investment on the rise with post-pandemic prospects

Since the operations of the Mekong Rustic hotel chain in Can Tho and Tien Giang had been temporarily suspended in the middle of last year, Bobby Nguyen, CEO of the chain and Crystal Holidays JSC, continues to implement tourism projects and invests in new projects, even though tourism has been the hardest-hit sector by the pandemic.

Nguyen said that the global health crisis has led many investors to sell their properties, but there were also many new financiers entering the sector, ready to take action.

“Investors are more interested in the tourism ecosystem, especially sustainable products such as those that combine healthcare or high-tech agriculture,” said Nguyen.

Currently, his company is looking to buy land in Lam Binh (Tuyen Quang) and Da Bac (Hoa Binh) to build resorts combined with community-based tourism. In Sa Dec city of Dong Thap province, the company is also surveying Flower World Sa Dec.

Exploiting the strengths of Sa Dec, which is known as the largest flower growing area in the southwest region, the project includes an urban complex of houses, tourism, services, culture, and an entertainment centre on an area of 420 hectares, which has been implemented for nearly 10 years.

The highlight of the project is the flower auction area with shophouses, festivals, and community-based tourism activities such as flower growers’ cooperatives and high-tech flower growing and export centres.

Brave progress

Dao Duc Long, an investor from Yen Bai, is CEO and operator of Aeris Hill, an adventure park and the destination for holiday warriors who love challenges in Tu Le commune of Yen Bai province. Since Aeris Hill opened its doors to welcome guests from the end of December, it immediately attracted the attention of visitors with the longest mountain zipline in Vietnam and 32 high rope games.

“The construction of the first adventure game park in the northwest is a venture investment but the value of it lies in the fact that it creates new products and awakens the potential of a tourism destination,” Long said.

Long’s Aeris Hill project was developed by Thinh Dat Green Development JSC. In addition to the adventure park, Long’s company is also the funder of three other projects in Yen Bai – Le Champ Tu Le Resort in Tu Le, Mu Cang Chai Resort in Mu Cang Chai district, and Ban Boon Nghia Lo Resort in Nghia Lo town.

Aeris Hill is the second project of Thinh Dat to come into operation after Le Champ Tu Le Resort opened at the end of 2019. Currently, this resort is also extending the number of rooms.

“Le Champ Tu Le is a 4-star resort suitable for families. Mu Cang Chai Resort focuses on high-class customers and Ban Boon Nghia Lo Resort is meant for the elderly. Aeris Hill Park is suitable for young customers from 6 years of age,” added Long.

The construction and completion of a large-scale resort and entertainment complex when tourism activities are halted by COVID-19 and foreign tourists cannot come to Vietnam could be a risky investment. However, Long asserted that there are two reasons that motivate his company to strive to complete these projects and even plan to implement other projects.

The first reason is the love for the land on which they were born and raised. The second is that the creation of a tourism complex that serves many different customer segments will give visitors a richer experience when coming to this land, and at the same time a long-term preparation for the recovery of the tourism industry.

Right time

The pandemic has caused negative impacts on the tourism industry but also opened up new opportunities for investors, especially those involved in small- and medium-sized initiatives.

Bobby Nguyen added that tourism investors at this time also have more favourable conditions than before the pandemic as localities are calling for investment and there are many preferential policies.

Besides that, in the past, the prices of hotels, restaurants, and cruises were greatly exaggerated over the real price. Now, many investors can buy these projects for half the price.

“The positive development of COVID-19 vaccinations and signs of recovery make investors carefully prepare as they do not want to miss the opportunity. We are now entering a recovery phase,” said Nihat Ercan, senior managing director and head of Investment Sales, Asia Pacific, JLL Hotels & Hospitality Group.

However, investors also face many challenges such as a lack of capital and market research channels. The change in consumer habits also makes it difficult to accurately assess the market. Therefore, many financiers are careful and try to understand the trend in this sector, which is currently shifting from single projects to entertainment complexes.

“Resorts and entertainment services, as well as models combined with on-site healthcare, will have the opportunity to recover and develop strongly. Synchronous projects in culinary experiences, entertainment, and healthcare are also attracting investors,” said Hoang Nguyet Minh, director of Commercial Leasing for Savills in Hanoi.

By Thai An

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