M&A set to drive Vietnam’s hospitality market in 2026

Analysts expect mergers and acquisitions (M&A) to accelerate sharply in Vietnam’s hotel and resort sector in 2026, particularly in the four-star and five-star segments in Hanoi and Ho Chi Minh City, as tourism recovery strengthens and investors hunt for premium assets.

Tourism and resort market surges early in the year

According to the latest data from Vietnam’s General Statistics Office, the country’s tourism industry started 2026 with strong momentum as international arrivals reached nearly 2.5 million in January, up 21% from the previous month and marking the highest monthly figure ever recorded.

By market composition, South Korea overtook China as Vietnam’s largest source of visitors with nearly 490,000 arrivals. Warm-weather coastal destinations such as Phu Quoc, Nha Trang and Danang remained particularly popular among Korean tourists.

China ranked second with nearly 460,000 visitors, while Cambodia unexpectedly rose to third place, a notable shift from previous years when the market typically ranked between sixth and 10th.

The statistics agency attributed the record growth to more open visa policies, revamped tourism promotion campaigns, diversified tourism products, and improved service quality, all of which have strengthened Vietnam’s appeal among international travelers.

The figures signal a clear recovery in inbound tourism and a positive outlook for the sector.

In practice, international travelers are increasingly diversifying their destination choices, while many accommodation facilities in Phu Quoc - particularly high-end resorts - have reported near-full occupancy.

The record number of international arrivals in the first month of the year is seen as a favorable signal for Vietnam’s goal of attracting around 25 million foreign visitors in 2026.

However, industry experts said the country must continue improving service quality, destination management, and infrastructure capacity to sustain growth amid rapidly rising demand.

David Jackson, CEO of Avison Young Vietnam, said the expansion of international flight routes, supportive visa policies, and increasing regional competition were pushing Vietnamese hotel operators to upgrade products and services to attract global tourists.

“The outlook for Vietnam’s hospitality and tourism industry will continue to focus on improving operational quality, expanding the premium segment and diversifying services, laying the foundation for Vietnam to become one of Asia’s most attractive destinations,” Jackson said.

Future growth is expected to concentrate increasingly on the midscale, upscale and luxury segments rather than mass-market expansion.

International travelers are placing greater emphasis on service quality, experiences, and emotional value, prompting developers to focus on projects with stronger design identity, branding, and storytelling.

As a result, hotels and resorts are shifting away from traditional accommodation models toward integrated experiences combining gastronomy, wellness, local culture, and entertainment.

Resorts linked to wellness, retreats, detox programs and slow travel are expected to see particularly strong growth, especially in coastal and eco-tourism destinations.

“In addition to traditional hotels, hybrid models such as branded residences, resort villas, next-generation condotels, and serviced residences tied to leisure travel are gradually returning, but with a more cautious approach focused on operational efficiency and real cash flow rather than short-term sales,” Jackson added.

Quiet but active M&A market

Data from JLL Vietnam show that Vietnam’s hospitality and tourism market recorded a strong recovery in 2025, with more than 21.2 million international arrivals and a compound annual growth rate of 10.1% during 2011-2026.

International arrivals are forecast to reach 35 million by 2030, driving significant demand for accommodation and resort properties in major cities and coastal destinations.

In the fourth quarter of 2025, hotel occupancy in Ho Chi Minh City reached 83%, while average daily room rates climbed to VND3.6 million ($137) per night. Revenue per available room (RevPAR) recovered to levels exceeding those seen before the pandemic.

Hotels in Vietnam’s two largest cities are seen as offering the strongest growth potential due to rebounding demand and relatively limited supply compared with coastal tourism hubs such as Danang and Khanh Hoa province.

The market has also continued to attract foreign direct investment and major M&A transactions aimed at expanding scale and improving operational standards.

Many hotels are transitioning toward international management models and diversifying offerings across traditional hotels, serviced apartments, MICE accommodation, and long-stay hospitality products.

The tourism boom is also increasing pressure for sustainable development, ESG integration, digital transformation, and more personalized services to meet rising customer expectations.

Phan Thi Anh Dao, senior manager of consulting and research at JLL Vietnam, cited one of the most discreet yet surprising M&A deals of 2025: the rebranding of Park Royal Saigon hotel into Garden Plaza following an acquisition in the third quarter of last year.

The transaction value was not disclosed.

“The new owner is a domestic conglomerate. This shows that diversified Vietnamese corporations are beginning to pay closer attention to hospitality assets after recognizing the long-term cash-flow potential of hotels, especially those in prime locations such as airport gateways,” Dao said.

She added that Vietnam’s hotel M&A market has remained quietly active for some time.

“The calm appearance is only superficial because most deals are not publicly disclosed. Behind the scenes, investors - particularly domestic ones - are actively hunting for distressed assets or properties whose owners are seeking to divest and restructure their portfolios,” Dao said.

One key factor affecting the market is investment yield.

In mature markets such as Japan and Australia, hotel investment yields currently stand at only around 3-4% due to low interest rates and stable market conditions.

In contrast, foreign investors entering Vietnam - especially private equity funds - are generally demanding returns of 7-9%, a far more challenging benchmark.

“Why are they demanding such high returns? First, market risks. Second, Vietnam’s borrowing costs and interest rates remain higher than in neighboring countries. In addition, transparency and legal procedures remain relatively complex. These factors force foreign investors to include a substantial risk premium in their return expectations,” the JLL Vietnam representative said.

The mismatch in pricing expectations between buyers and sellers has effectively frozen parts of the market.

However, Dao said 2026 could become a breakthrough year as tourism recovers strongly, especially with the return of Chinese and Indian travelers, improving cash flows for resort and hospitality assets.

As a result, JLL Vietnam forecasts that 2026 will see a surge in hotel M&A activity, particularly in the four-star and five-star segments in Hanoi and Ho Chi Minh City.