VIETNAM – Meet Linh Vu, a trailblazer in the Vietnamese hotel industry whose journey began far from her homeland. The daughter of Vietnamese boat people who fled their war-torn country in 1975, Linh’s family found refuge in Paris. Raised in a world away from the struggles of her ancestors, she graduated university and eventually returned to Vietnam in 2007 to work as a local development director for Accor. This marked the beginning of her significant influence on the hotel sector in Vietnam.
During her tenure, Linh observed a troubling trend: brand companies were often taking advantage of first-time Vietnamese developers, negotiating agreements that heavily favored the corporations. To combat this, she founded a consultancy, Key Hospitality Consulting, in 2009. Since then, her firm has advised new developers not just in Vietnam, but also across emerging markets in the Middle East, Southern Europe, Africa, and even Cuba.
Linh has worked with a diverse clientele, including private equity firms and ultra-high net worth individuals, helping them navigate the complexities of hotel development. Her impressive portfolio includes notable projects like the Novotel Saigon Center, Pullman Saigon Center, and Hyatt Place Saigon, highlighting her influence in both local and international markets.
“It’s an accessible market compared to the massive markets of China and India. You also have amazing demographics, which is a prerequisite for hotel development, and it’s very manageable. You literally cover north to south in two hours… It’s less intimidating because it’s more consolidated.”
Linh Vu
Vu has a finger on the pulse of the current hotel development climate in Vietnam, especially in light of a recent high-profile fraud case involving a hotel owner. This case raised numerous questions about the overall integrity of the sector and coincided with a broader anti-corruption campaign within the government. Linh sees this as a pivotal moment: a chance to reset and establish more rigorous, ethical practices in all facets of hotel development.
Managing Growth
As Vietnam transitions from a Least Developed Country to an Emerging Market, the rapid growth has not come without its growing pains. “Vietnam was dirty poor and in such a short amount of time it managed to create wealth and now an emerging middle class,” Linh explains. The recent fraud scandal serves as a significant lesson, indicating the necessity for a more disciplined approach moving forward.
In reaction to the scandal, Vu believes there will be increased vigilance among hotel owners, operators, and advisors. She emphasizes the need for a more thorough learning curve, especially as Vietnam finds itself in competition with regional ‘tiger’ economies like Thailand and Singapore.
“My take is that it’s a normal part of an emerging country’s development. The upside is that now we have to reset. We have to clean up things and it will become beneficial to the overall development of the country and hospitality wise.”
Linh Vu
With a new president at the helm and a crackdown on corruption, the hotel development landscape is shifting. While neighboring developers adopt a cautious, “wait and see” approach, Vu believes that this creates a unique opportunity for foreign investors willing to take calculated risks. “There is a very unique momentum, a unique window in the next 12 to 18 months,” she asserts, especially for those ready to partner with local stakeholders who can help navigate regulatory challenges.
Linh cites President Biden’s recent visit to Vietnam as a potent symbol of the country’s openness to American investments. Despite lingering concerns rooted in historical tensions, the current geopolitical climate has fostered a welcoming environment for U.S. investors. “Sometimes U.S. investors might have biases due to the war thinking that they might not be welcome. Actually, the Vietnamese government and the private sector are more than happy to do business with U.S. investors,” Vu highlights.
For those considering entry into the market, Linh advises finding a local partner who can assist in managing bureaucratic challenges and human resource issues. Starting in established tourism hubs is also recommended, as these locations still offer substantial growth potential.
Repatriating investments remains a concern for foreign stakeholders, but Vu assures that it is feasible with the right guidance. Many avenues exist for safely repatriating funds, as long as investors have the proper advice from the outset.
When discussing specific investment opportunities, Vu notes the ongoing development of Phú Quốc Island, where several high-end hotels are under construction. She emphasizes that looking beyond the well-trodden paths of Hanoi and Ho Chi Minh City can reveal numerous opportunities in emerging destinations.
Urban centers are equally promising. The rise of Vietnam’s middle class is transforming markets in Hanoi and Ho Chi Minh City, where new quarters and transport infrastructure, like a new airport in Ho Chi Minh City, are paving the way for substantial hotel development.
Leisure tourism remains a focal point, but a burgeoning domestic MICE (Meetings, Incentives, Conferences, Exhibitions) market complements these opportunities, especially as Vietnam’s topography offers quick access to beach destinations—all within an hour and a half from most urban centers.
Ultimately, Linh Vu believes that accessibility is Vietnam’s strongest asset in hotel development. “It’s an accessible market compared to the massive markets of China and India. You have amazing demographics, which is a prerequisite for hotel development, and it’s very manageable,” she asserts.