Developers are moving towards a golf course - resort model as Vietnam eyes becoming a major golf tourism destination.
Quang Ngai in central Vietnam is set to become the country’s latest golf tourism destination after the FLC Group announced in late June plans to build a new 18-hole, international-standard course within the 1,026-ha FLC Quang Ngai project, the first phase of which will be put into operation next year.
The province has an important position in the Central Economic Zone but its road, railway, waterway, and air links are far from convenient. Nature, meanwhile, has given it more than 130 km of coastline, where six large seaports have been built, which together with My Khe and Ly Son forms a diverse ecosystem.
A representative from the FLC Group told VET that the project is therefore part of its long-term real estate development strategy.
“We have a mission to ‘awaken lands of potential’ throughout Vietnam by investing in the construction of resorts with international-standard golf courses,” he said.
FLC has been developing 29 other golf courses around the country, with FLC Sam Son Golf Links, FLC Ha Long Golf Club, FLC Quy Nhon Golf Links, and FLC Quang Binh Golf Links already welcoming golfers. In the long term it will develop about 100 courses throughout Vietnam.
It also has a professional golf operations management unit, FLC Biscom, which has many years of experience organizing major golf tournaments in combination with tourism.
“The integration between tourism and golf in resort real estate not only has a domino effect on tourist numbers and investment location but also creates a distinctive mark for the FLC Group, which is high-class, coordinated tourism that meets all the demands of domestic and foreign tourists,” the FLC representative said.
Among major developers, Vingroup’s Vinpearl has built or is currently building four international-standard golf courses in some of Vietnam’s most attractive tourist destinations, including Hai Phong, Hoi An, Nha Trang and Phu Quoc Island.
Vinpearl Golf Nha Trang opened in 2011 and Vinpearl Golf Phu Quoc in 2014 on an area of 80 ha. Its courses are also located in Vinpearl resort and entertainment complexes, ranging from 18 to 36 holes and in diverse styles, from island courses to lagoon courses. Vinpearl Golf Hai Phong and Vinpearl Golf Nam Hoi An are its newest additions.
Mr. Dang Thanh Thuy, Deputy General Director of Vinpearl, told VET that the golf and resort model has been successfully employed in many countries around the world and has contributed to the development of the golf industry.
“Built next to a complex of resorts, hotels, and entertainment parks, Vinpearl Golf promotes the resort golf model and courses are at a standard not inferior to famous courses in the world.”
Vietnamese developer the Novaland Group, meanwhile, signed a deal with Greg Norman, one of the most prolific and venerated golf course designers in the world, in late 2018 to develop four courses at its integrated resort complexes in southern cities and provinces such as Can Tho, Ba Ria Vung Tau, and Binh Thuan, with total investment of some $100 million.
KN Cam Ranh also partnered with Norman to develop KN Golf Links. “Cam Ranh has the potential to be a world-class tourist destination,” said Mr. Le Van Kiem, Chairman of the KN Cam Ranh Company Limited, the course’s developer.
In south-central Khanh Hoa province, it occupies 90 of the 800 ha of KN Paradise, an ambitious integrated resort that will also feature at least three five-star hotels, an array of luxury real estate opportunities, a marina, and a beach club, among other entertainment facilities.
In the past, many golf courses were built exclusively for players, but in recent years more developers have turned golf courses into an indispensable feature of resort tourism, joining five-star resort services. Mr. Matthew Powell, Director of Savills Hanoi, said golf courses are now often part of a large resort project.
“This used to only be considered a lavish extra at a project, but with increasing demand among domestic and foreign vacationers, golf courses seem to have become an indispensable feature of luxury resort projects, attracting more guests,” he said.
According to the “Golf Around the World” report released early this year by the National Golf Foundation, Vietnam is seeing the highest growth in golf development in Asia and has emerged as a major market.
It boasts a coastline of 3,260 km and scenic mountains, winding rivers, and a tropical climate suitable for outdoor sports and travel. The FLC representative said these are the perfect conditions for Vietnam to develop golf tourism.
Mr. Thuy from Vinpearl agrees that Vietnam’s landscapes, climate, and tourism potential represent an advantage in developing the very specific golf model.
“Golf is growing in popularity in Vietnam and the number of international visitors coming to play grows strongly every year, which is also a factor motivating Vinpearl Golf to become involved in infrastructure development and improving service quality,” he added.
Mr. Powell told VET that the development of Vietnam’s tourism includes greater numbers of high-end foreign tourists, including golf-lovers that have played all over the world.
“This is a driving force for real estate developers to invest in golf courses,” he said. Figures from the General Statistics Office show that nearly 8.5 million international visitors came to Vietnam in the first half of this year, up 7.5 per cent over the same period last year.
The FLC representative said the Vietnamese Government encourages businesses to invest in tourism infrastructure in order to make tourism a key economic sector, and it targets 89 golf courses by 2020 in official plans.
“This is favorable for businesses such as the FLC Group to continue investing in golf tourism,” he added.
The Vietnam Golf Association (VGA) was established recently to act as a bridge linking local courses with domestic and international travel companies and domestic and overseas courses to offer sustainable and professional golf tours and diversify Vietnam’s tourism products while attracting more golfers, who also tend to visit other local destinations.
Many experts, meanwhile, say the development of golf tourism in Vietnam is still in the initial stages and is yet to match potential or truly compete regionally. The country now has 55 courses, while Indonesia has 151, Malaysia 230, and Thailand 256.
The proportion of international golfing tourists was estimated at only 0.8 per cent of the total of 15.5 million international visitors last year, according to the International Association of Golf Tour Operators (IAGTO).
The FLC representative pointed out that the return-on-investment (ROI) in golf courses can take years and businesses that want to succeed in the field need a long-term vision and must make coordinated investments.
“As well as investing in a golf course, developers also need to pay attention to the golf ecosystem, which includes accompanying tourist and resort services and the organization of tournaments,” he explained.
Mr. Powell said the greatest difficulty when investing in a golf course is possessing strong financial resources and an ability to invest long term.
“The golf course itself is not a lucrative product, but developers need to view it as part of a luxury resort project, increasing the value of the project,” he noted. “This property segment is expected to continue to grow into the future, along with growth in the resort market.”