While Vietnam has been on the short list of countries outperforming in terms of hotel metrics recently, there were some questions whether that strong performance was just off a low base or if it'd be continually sustainable in the way countries such as India and Japan have been in recent years.
But Jesper Palmqvist, STR's area director for Asia-Pacific, believes Vietnam is slated to be one of the top performers in the region for an extended period.
Speaking on the latest episode of the CoStar News Hotels podcast, Palmqvist noted infrastructure and foreign investment will buoy Vietnam's hotel market going forward.
"The amount of money that is available to fix things up in terms of roads and airports and and that infrastructure is quite extraordinary," he said. "And with that, we've had this massive pipeline of hotels and retail and other things, as well. So it [will be] really interesting to see when you build all that up."
The island of Phú Quốc, in particular, has long-term potential to shine as one of the major tourism destinations across Asia-Pacific, Palmqvist said. Just a few years ago, none of the infrastructure or hotel supply existed to support that.
As noted, a lot of the recent growth has come off a low base, and it is still to be determined just how desirable it will be compared to other major destinations in the Asia-Pacific region.
"The main thing is 'Can you compete with the big boys?'" he said. "Can you compete with Phuket?"
For now, though, Phú Quốc has seen better hotel performance to start 2026 than Phuket, which Palmqvist called "an extraordinary breaking point" for the market.
Across the Asia-Pacific region, the effects of conflict in the Middle East are still largely to be determined, but it's clear some markets, including India, see a higher degree of Middle East traveler demand than others.
He noted Thailand, Malaysia and Vietnam have "very low, single-digit dependency" on Middle East travelers.
For more from STR's Jesper Palmqvist, listen to the podcast episode embedded above.