A section of beach in Nha Trang is dug up to make way for several constructions. PHOTO: HIEN LUONG
The other evening I was having a chat with several of my expat friends at a bar and restaurant on Nguyen Thien Thuat Street in the center of the Nha Trang “tourist ghetto”.
I noticed a sign board with the words, in English, “For Sale or for Rent” propped up on the front of the building. I knew the place had been owned by two expats but one had recently sold his interest to the other.
I am part of a group that hold a weekly “Trivia quiz” and we had previously held it on the second floor of this restaurant because they were not that busy on Tuesday evening but we had been told by the owner that his business was picking up and that he couldn’t afford to let us use the space that could seat diners. Our group was primarily beer drinkers.
When I spotted the sign, I asked if they knew why it was for sale. They said the rent was raised and the business couldn’t support the higher overhead. Then someone pointed across the street to what had been one of the busiest seafood buffets in Nha Trang and stated: “They just closed and moved out yesterday… their rent was doubled!”. The large place was gone.
In the ensuing discussion with my friends we continued to talk about the speed with which the face of Nha Trang is changing. If you haven’t visited here recently you’d be amazed at the way small buildings and shops are disappearing to be replaced with hotels of at least eight to seventeen floors or more. Even relatively narrow properties are now the site of such buildings.
One fellow remarked that the property values in Nha Trang had been going up at such a dramatic pace that small restaurants and shops can no longer afford the rents and only multi-floor hotels or apartments can make enough to return a profit.
I am not a business man and my house is well removed from the center of the tourism business so I have no idea of the dollar amounts we are talking about. I do know that ten years ago, one of the men my wife and I swim with in the morning told us that he had sold a small hotel he owned on Hung Vuong, about two blocks away from where we were sitting, for US$750,000. It seemed, at the time, to be a lot of money.
However, six months later, while the hotel sat empty, I learned that the new owner had sold it for $1,5 million, double our friend’s selling price. Still nothing was being done with the property except to raze the old building and it was again sold for a reputed price of $2,5 million. Same spot, now more than triple our friend’s price after a year or so and there had still been nothing built. All of this price escalation was purely speculative.
Now if you drive around Nha Trang, well away from the original center of tourism at Biet Thu and Hung Vuong, you will see dozens of hotels under construction. Obviously there is no intelligent land use enforcement from the regional authorities at work here.
What makes this hard for me to accept is that all of the land in Vietnam belongs to the government. All of these extraordinary prices are not buying land… it is buying a lease from the government… in other words, the Vietnamese people! But the “people” are not seeing one dong from these transactions.
In Nha Trang, which was a tiny town on a beautiful bay, some old families still recently held rights to relatively valueless sandy ground on dirt streets where today’s tourist ghetto stands and these people are now multi-millionaires (in US dollars). Families who were on the wrong side had all of their property taken from them. In some cases they were given the right to use a small house of far lesser value.
Recently, Vietweek ran an article on the devastatingly harmful plans for further private commercial development of the Nha Trang shoreline. In spite of numerous negative reports from relevant local consultants advising strongly against it, the article stated that Khanh Hoa authorities were permitting it.
All of what had made Nha Trang a destination that was beginning to appear on the radar of the major travel publications and tour companies is rapidly disappearing. In spite of the huge increase in tourism from Russia to Nha Trang, if you look at the hundreds of hotel rooms under construction or nearing completion you have to question whether the Russians alone can fill them.
Present occupancy at the existing hotels fluctuates dramatically with plenty of vacancies except at Tet. The ambience of the beautifully situated sea shore town is under attack and the barbarians seem to be winning.
Pretty soon the walker-friendly shops and restaurants in small and varied buildings all over Nha Trang will have disappeared and it will be as urbanized and sterile as Miami beach.
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