Da Nang and the Anticipation of the Return of Condotels
With numerous decisive factors, Da Nang is expected to regain its status as the “big brother” of the resort market, along with the resurgence of the condotel (tourist apartment) model in the new era of real estate development.
As the fourth largest city in Vietnam, Da Nang represents a sophisticated blend of natural charm and tranquility with dynamism and prosperity. According to real estate experts, it is a rare case in the Vietnamese property market, possessing a unique dual identity that not every location can boast.
Urban Strength “2 in 1”
The first aspect of Da Nang’s strength is its appeal as a high-end tourism hub, characterized by a distinctive coastal ecosystem linked to local cultural values. This unique quality helps Da Nang become one of the few destinations that attract both domestic and international visitors throughout the year, not just on weekends. In the first quarter of 2024, nearly 2 million tourists visited Da Nang, leading to estimated revenues of 6,400 billion VND from accommodation and dining, a 19.8% increase; and 1,200 billion VND from travel services, a 68.9% increase compared to the same period last year.
The Second Supporting Factor
Recently, the National Assembly has passed a resolution to pilot several special mechanisms and policies for the development of Da Nang. Accordingly, the Prime Minister has decided to establish, adjust, and expand the boundaries of the Da Nang Free Trade Zone.
At a meeting on August 25, Da Nang’s People’s Committee announced that on August 31, the city will hold a conference to implement Resolution No. 136 of the National Assembly on organizing urban administration and piloting some special mechanisms and policies for city development, with the participation of about 500 central and local delegates, diplomatic agencies, and businesses.
Key investment areas include the construction and business of infrastructure for functional zones within the Da Nang Free Trade Zone; investment in inland waterway tourism with capital exceeding 8,000 billion VND; and investment in the development of the Lien Chieu seaport project with capital exceeding 45,000 billion VND.
However, from the perspective of resort real estate, Da Nang needs more time to regain its momentum. Although Da Nang’s tourism industry is showing positive signs, the presence of many problematic projects, slow construction progress, and investor confidence being “eroded” after the CocoBay commitment issue have all impacted the market liquidity.
In the long term, Da Nang’s resort real estate has development potential, but in the short term, it is difficult for the market to achieve a breakthrough in demand. In the real estate market’s journey, the resort segment still needs to “gain strength” to keep up with the new cycle.
Additionally, Da Nang is also the economic engine of Central Vietnam, with a vision to become the “Silicon Valley of Asia,” a smart city with strengths in technology and industry. The special mechanisms and the pilot free trade zone are also a special priority from the central government for Da Nang, expected to be a boost for the local economy.
Recently, at the seminar “Da Nang – Unleashing Potential, Elevating to International Standards,” co-organized by Bất động sản Bản Việt – VCRE, Nobu Danang, and CBRE in Hanoi, Mr. Trinh Tuan Bao, representative of Da Nang’s Department of Tourism, shared that, in addition to focusing on human resources, land, and urban infrastructure, the business environment is also a key driver to enhance the city’s status at the national and international levels.
With positive indicators, Da Nang’s real estate is expected to recover. Experts believe that all attention is focused on the valuable opportunities Da Nang has been given, which implies hopes of returning to a leading position in the resort market. The implementation of three important land and business laws effective from August 1, 2024, is also a strong impetus for Da Nang to gain a competitive advantage, even compared to key markets like Hanoi and Ho Chi Minh City.
The Anticipation of the Return of Condotels in Da Nang
According to economist Dr. Can Van Luc at the seminar, the most positive change in the market is the legal improvements, including issuing certificates through detailed, clear, and transparent guidelines. Specifically, Decree No. 10 of 2023 allows the issuance of ownership certificates for tourist apartments (condotels), officetels, and tourist villas on commercial and service land. As a result, condotels are also expected to open a new development chapter as an investment-worthy product in one of the most livable cities in the region.
Currently, “Is there a long-term vision for condotels?” is a question many investors are asking. Many developers believe that once the final legal checkpoint for ownership certification is legalized, condotels will not only satisfy the living enjoyment needs of customers but also generate stable returns from the broader demand for resort stays.
Danang Continues to be a Hub for Renowned Global Hospitality Brands
A representative from VCRE, the company partnering with Nobu Hospitality for a high-end real estate project on My Khe beach, asserts that condotels demonstrate their value by being part of an integrated experience, combining amenities, multifunctional features, and elevated experiences.
The representative also noted that the limited number of units is a solution for investors to maximize profit, increase, and maintain value in the medium and long term. In reality, if the number of apartments is too large, it can lead to difficulties in rental occupancy, capital returns, and liquidity.
Experts predict that the potential for tourism in Da Nang and the ongoing development of the legal framework will help condotels enter a new era of growth.
According to Dr. Nguyen Van Dinh, Chairman of the Vietnam Association of Realtors (VARS), Da Nang’s real estate value has been relatively stable over the past 3-4 years. With ideal conditions, the synergy of special mechanisms, urban planning, and systematic tourism promotion, Da Nang’s real estate is expected to have significantly higher value in the near future, surpassing its current levels.
