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The total number of 1-5 star-rated accommodation establishments has decreased by 1,342 compared to 2019, mainly consisting of 1-2 star-rated hotels. Many hotel owners have closed or switched to selling alcohol.
On the afternoon of March 23rd, the Ho Chi Minh City Tourism Department organized a seminar entitled “The current situation and solutions in the operation of small and medium-sized accommodation establishments in the city”.
At the event, Ms. Bui Thi Ngoc Hieu, Deputy Director of the Ho Chi Minh City Tourism Department, stated that the city currently has 3,227 tourism accommodation establishments, corresponding to over 65,000 qualified business rooms. Of these, there are 325 1-5 star-rated hotels, equivalent to 17,613 standard rooms, and 2,902 hotels meeting the minimum criteria for facilities and service techniques, corresponding to over 48,000 standard rooms.
Notably, compared to the end of 2019, the total number of 1-5 star-rated accommodation establishments has decreased by 1,342 establishments, leaving only about 325 establishments, equivalent to a 312% decrease compared to the same period in 2019, with the largest decline among 1-2 star-rated hotels. According to Ms. Hieu, the main reason is that the Tourism Law of 2017 stipulates that tourism accommodation establishments voluntarily rate their stars, and are not required to do so like the Tourism Law of 2005. Therefore, a large number of hotels without a need for star ratings have appeared in Ho Chi Minh City, leading to a significant decrease in the number of 1-2 star-rated hotels.
Hotels from 0-3 stars in Ho Chi Minh City face difficulties when the source of international visitors has not recovered. (Photo: Chi Hung).
Regarding room sales performance, in 2022, 4-5 star rated hotels achieved an average occupancy rate of around 75%. Meanwhile, hotels with 0-3 stars are facing many difficulties due to the slow recovery of international tourist demand, decreased market purchasing power, and a shortage of skilled personnel in the hotel industry.
“Most small and medium-sized hotels have not yet met the criteria for ensuring security, order, and fire safety. The physical conditions of some accommodation facilities have deteriorated and require repair or replacement of equipment. However, hotel owners are facing economic difficulties and are accepting closure, temporary suspension of operations, or a change in business type to sell alcohol,” said Ms. Hieu.
Ms. Do Thi Anh Tuyet, Head of the Culture and Information Department (District 1), said that many tourism accommodation facilities in the district are facing difficulties in obtaining fire safety approvals (due to the deterioration of the facilities not meeting fire safety criteria). When the accommodation facilities do not meet the fire safety criteria, they will not be issued a certificate of security and order. This is the minimum condition that must be ensured before conducting business activities.
Regarding difficulties, Ms. Nguyen Thi Thuy Loan, representative of the A25 Hotel system, said that in the past 3 years, the unit’s accommodation system had been closed for at least 2 years due to the pandemic. The A25 hotels have only been reopened for 1 year, so the physical facilities have deteriorated over time. On the other hand, the system’s revenue has decreased, and the state only supports electricity and water costs and borrowing during the most severe pandemic period. Landlords also only provide limited support, so A25 almost has no source of funds to upgrade or renovate its physical facilities.
“We have to carefully consider and choose the optimal plan for investment and purchasing. It takes a lot of time and is difficult to satisfy demanding tourists,” Ms. Loan stated.