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A series of hotels accept to sell losses due to bank debt

A series of hotels accept to sell losses due to bank debt

Friday 25, 09 2020
Many hotels in Da Nang could not bear operating costs and borrow interest due to the impact of two COVID-19 pandemic, so they had to accept to sell their hotel at a heavy loss price.

➢   A series of large and small hotels for sale

According to a reporter survey on a real estate advertising page, only on September 22, there was 80 news for sale and transfer of hotels in Da Nang. Hotels for sale are located throughout busy, bustling tourist streets such as Vo Nguyen Giap, Bach Dang, Ho Nghinh, Ho Xuan Huong ...
 
Most hotel information for sale has the content "bank debt needs to sell hotel urgently".
 
A hotel on Do Bi Street (My An Ward, Ngu Hanh Son District) advertised an area of nearly 250m2, wearing money at 13.5m, is located in the center of many foreigners with a price of 70 billion dongs. This hotel has 12 rooms, 56 rooms, including a spa, massage, swimming pool, and especially just 100m from My Khe beach.
 A series of large and small hotels for sale
"Bank debt should urgently sell 4-star hotels, the cheapest price in the market in COVID-19 pandemics", the seller advertised. In addition to small and medium hotels, large hotels costing three or four hundred billion dongs also sell widely online.
 
For example, a 4-star hotel in the front of Vo Nguyen Giap sells for 450 billion VND. The hotel has an area of ​​15x40m, 20 floors, 126 rooms, a restaurant, an infinity pool, conference room.
 
“All 4-star standards, located in front of Vo Nguyen Giap beach, the most beautiful and favorable part of the road. Now the family on exit needs to sell at low prices ”, introduced by the seller.
 
Similarly, hotel owners on Vo Nguyen Giap Street put up for sale 16-story hotel, 120 rooms, area 450m2 for 320 billion VND. The advertised hotel has a kitchen, dining room, terrace, car parking, ...
 
According to the seller, the hotel has just been exploited since 2018, the number of visitors is stable, the occupancy in the peak season is 98% and the low season is 75%.
 
Or hotel frontage Bach Dang street (Hai Chau district, Da Nang), view of the romantic Han River, an area of ​​more than 300m2 sells for 200 billion VND.
 
According to the City Department of Tourism in Da Nang, facing a difficult situation due to epidemics, a number of accommodation establishments have carried out procedures for buying, selling, and transferring resort real estate, hotels, and apartments.
 
According to preliminary information, there are about 250-260 hotels, apartments, and villas for sale (accounting for 24.7% of the total motels and hotels in the area).
 A series of large and small hotels for sale
According to calculations, in 2020, Da Nang will only receive 2.7 million visitors, a decrease of nearly 69% compared to the same period in 2019. In which, international visitors are estimated at more than 686,000, a decrease of 80 , 5%; Domestic visitors were estimated at more than 2.03 million, down 60.6%. Total revenue from the tourism industry is estimated at more than 10,000 billion VND, a decrease of 65% compared to 2019.
 
Notably, the estimated total damage to the total revenue of the tourism industry of Da Nang in 2020 is expected to be about 26,000 billion VND. In which, the total (direct) damage to the tour operators is about 659 billion VND; about 4,800 billion VND in tourist accommodation establishments; at the tourist transport business about 518 billion VND and about 827 billion VND in tourist areas and spots.

➢   Hotel sales were commonplace during the COVID-19 pandemics

Talking about hotel listings, Ms. Truong Thi Hong Hanh - Director of Da Nang Tourism Department, hotels for sale are mainly 1 to 3 star hotel segment. In the context of an epidemic, the Department of Tourism has also implemented support measures for businesses as much as possible.
 
“Businesses with losses must accept to sell, this is the law of supply and demand of the market. Assuming there is no epidemic disease, if they make a loss, they still have to transfer it, ”said Ms. Hanh.
 
Mr. Cao Tri Dung - Chairman of Da Nang Tourism Association, admitted that many hotels for sale because of difficulties. Hotels for sale are mainly motels, hotels 1-3 star. There are 4 star hotels but not much. However, Mr. Dung also said that it is a normal thing, the law of supply and demand of the market.
 
“It is not because of translation that Da Nang hotels have to sell it. Before the translation, there were also activities of transferring and buying and selling hotels. However, possibly due to translation, this activity increases. The current supply is large while the demand is decreasing, investors will consider where to invest more reasonably, they will withdraw capital ”, Mr. Dung assessed.
 
Mr. Dung affirmed that even after the sale of hotels happened after the epidemic, it would not affect the service of Danang guests because the city had more than 1,100 hotels. Tourism capacity of Da Nang is huge.
 
“This even has the effect of screening businesses. Enterprises that find it difficult to keep up with the trend of business, if they may lose a long time, then screen. As for larger businesses, larger scale, with good financial resources, if they can stay longer, they will serve customers better, which is the law of the market ”, Chairman of Danang Tourism Association recognize.

Source: Vietnam Finance, Translated by Vietnam Credit

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