Recently, Da Nang has seen a boom in the number of condotels (also known as condo hotels) which will help to offer more options for buyers.  Condotel is a combination of apartments and hotels.

Condotel project developers often mobilise investment capital for their projects through a sale-leaseback transaction with their offered-property owners.  The owners buy a fully serviced condominium as a vacation home, but then offer it for short-term rentals on a hotel-type basis.

Visitors view a model of a real estate development

In developed countries, this type of property is one of the most attractive segments of the real estate industry and it mainly attracts customers with high financial capability thanks to its appealing profitability.  Since appearing in the Vietnamese market, the real estate model has become the latest craze in the domestic real estate market because of its highly competitive advantage.

According to a spokesperson for the company CBRE Viet Nam Global Research and Consulting, in the first half of this year 6 condotel projects were completed in Da Nang offering a total of 2,436 rooms.  This brings the total number of condotel rooms in the city to 3,084.  The city will have 800 more condotel rooms once the Tourane Condotel and Condotel Central Coast projects are put into use in the 3^rd quarter of this year.

Mr Marc Townsend, General Director of CBRE, predicted that the condotel sector will grow more strongly in Da Nang, and in Viet Nam as a whole, in the years ahead.  The main reasons are the sustainable profitability potential and reasonable prices of this type of property, as well as the controlled inflation in Viet Nam.  He also remarked that this real estate model will become more attractive to investors from both home and abroad.

However, some domestic real estate experts have warned potential buyers to carefully research the financial capacity and reputation of the condotel projects’ developers before making their purchase decision.  Their focus should be on carefully checking the quality of the condotel projects, their favourable geographical positions, their potential profitability, and their legality.