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C9 Hotelworks Founder and Managing Director Bill Barnett is a noted columnist, author and leading authority on travel trend, hotels and property.View all the books from C9
What has long been predicted in Vietnam’s amped up condotel industry as unsustainable guaranteed returns has come home to roost.
Making news is the massive Cocobay project in Danang, who’s developer the Empire Group has reportedly stopped making guaranteed return payments to owners.
The knock-on effect of this has been on buyers who in turn have been unable to make mortgage payments to banks.
Given the scale of many Vietnam condotel project’s where units number in the thousands, expectations in the industry are for further pain in the sector where unsustainable double-digit returns have been promised to attract buyers.
In Phuket, over 50% of the incoming hotel supply currently rests in hotel residence offerings with many projects offering high-levels of guaranteed returns.
Thailand currently does not regulate the development practice despite growing calls for oversight.