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Cocobay - The tourist resort city in Da Nang
Railway news in Indonesia, Laos, and the Philippines, an update on Indonesia's new capital, the world's largest parliament building opens, and more transport and construction news in SE Asia.
I wasn't joking in last week’s newsletter when I jested that the Hanoi metro apparently, hopefully, if all things go to plan, will open on May 1.
May Day has come and gone, and the metro did not open as planned.
And now that covid has reappeared in Hanoi and some neighbourhoods are being locked down, it might be delayed again. Either way, it seems unlikely that I will be travelling there this month.
This week's article is regarding one of the biggest single developer leisure projects in Vietnam.
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Cocobay is a leisure and entertainment complex in Da Nang, covering an area of 31 hectares with a 600-metre beachfront.
I've been intrigued by Cocobay ever since I first started seeing ads featuring football legend Ronaldo promoting this development in 2017. The news copy says that he bought an apartment in the main tower, though it seems unlikely that he is promoting this for free. Maybe he bought an aprtment for 1 dong, and in exchange he helps out with promoting. Not that I begrudge him for adding to his international property portfolio, but a disclosure would help.
Advertising for Cocobay was all over Da Nang by then, and I’ve been following its progress ever since. I've been to Cocobay three times now, and things have been looking worse with each successive visit.
On my first visit in 2018, Cocobay was still a work in progress but it had begun operations. Some hotels were taking bookings, and a few restaurants were open as well. I had lunch at a pho restaurant, and then had a wander around.
On my second trip in 2019 there was still plenty of construction activity, but some of the restaurants that were open previously had closed down.
My last trip in 2020 I arrived at the gate to find it barricaded. I went down another service road but I was stopped by security.
2020 was a terrible year for tourism in Da Nang, with mass closures of hotels due to the pandemic. The double whammy of no international visitors and confusion over investors rights hit Cocobay hard.
It was in between my second and third trip at the end of 2019 when the investor announced that they could no longer honour the generous 10-12% guaranteed annual returns for condotel investors. A 10-12% rental guarantee for 8 years would ring alarm bells in any other country, but the condotel market is still developing here, and laws are being formulated as they go.
After the debacle of the guaranteed returns not being paid, parties on both sides have tried to come up with a compromise. One solution is to convert condotels into permanent apartments, though there is resistance for this solution by some experts.
One of the things that concerns me is how big this project is, and that it is primarily for leisure only, and not for permanent residents.
I'm struggling to think of a project this size that is purely for leisure. It’s one thing to have a single hotel resort enclave, but a mini city exclusively for tourists is unusual. This project will have 10,000 hotel rooms, so a city entirely of tourists, plus, say, 10,000 workers who service the place.
When I visited Cocobay it felt like I was visiting a ghost town. With no one living there, it’s going to be hard to sustain the buzz that the advertising suggests.
It needs a regular population living there to make it feel more vibrant. Having some locals there to pre-populate the cafes and restaurants will take the edge off the ghost town vibes. The two times that I did go there, I saw more workers than guests.
It would have been easier if it was built next to another new urban area where people actually live. Cocobay is built between two golf courses, and it’s half way between Da Nang and Hoi An. If you are staying in either place you have to make a concerted effort to visit Cocobay.
I will keep returning to Cocobay for updates, pandemic willing, so stay tuned to Future Southeast Asia!
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