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BANGKOK: The Bangkok hotel market recorded strong numbers for the peak first quarter (1Q) 2011 period, indicating that the troubles of last year have been largely left behind, according to the latest Bangkok Hotel Market Report from Colliers International Thailand.
Colliers managing director Patima Jeerapaet noted the strong rise in occupancy for 1Q to similar levels recorded in the same quarter of 2010. "Clearly, the resumption of long term bookings are now taking effect and you could say it is business as usual for the industry," he said.
However, Patima warned that future new supply, especially in the Upper and Luxury end of the market will keep hoteliers on their toes.
"Developers are still clambering to establish higher scale hotels, and this will mean that tourism growth will need to continue apace to absorb new supply," he said. Around 6,000 rooms in the Upper/Luxury segment is expected to enter the market over the next two years, the report stated.
The ability for Thailand to bounce back after adversity is a unique quality for the country according to Colliers director of hospitality Jean Marc Garret. He dubbed this the "darling effect", as tourists are long accustomed to the travails of the country and are rather sanguine to these due to familiarity. Garret noted that Thailand has a high level of returning visitors, around 60%, compared to other countries. "In Thailand, people know what is really happening compared to the news reports and will return after just a few months," he said.
However, associate director for research Antony Picon was more cautious about Bangkok's prospects in light of increasing competition from its neighbours. "Vietnam, Cambodia, Laos and Myanmar are growing more strongly and altogether account for about 60% of the arrivals figure for Thailand." Picon said Bangkok risks being squeezed between cities such as Ho Chi Minh City, Yangon, Phnom Penh, and the more mature cities such as Singapore and Hong Kong, which reinvent themselves to keep fresh to entice tourists. "Bangkok and the country must start doing the same rather than relying on Land of Smiles and elephants," he warned.
In 1Q 2011, a total of around 75 rooms were added to supply in Bangkok in the Upper/Luxury segment with the opening of just one hotel, The Sivatel Bangkok, in the Northern CBD area. The total number of rooms at the end of 1Q 2011 was more than 15,100 in the Upper/Luxury segment.
Average occupancy rates have been rising since Q2 2010 although Q4 2010 and 1Q 2011 represent the traditional high season for the city. For the Luxury scale segment occupancy increased significantly in 1Q 2011 compared to 1Q 2010 from the mid sixties to the high seventies. However a small decrease was recorded in the Upper segment with a few percentage points drop.
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