Thai hoteliers optimistic over future growth

Thai hoteliers optimistic over future growth

Hotels in the resort city of Pattaya recorded some of the highest occupancy rates in Thailand last year

Thailand’s hotel industry is going through a protracted recovery following global economic recession in 2009 and two years of political instability, but hoteliers are positive in their outlook.

Horwath HTL released its 2011 Thailand Hotel Industry Annual Survey of Operations this week, putting overall hotel occupancy at 58% for the financial year 2010, with highest occupancy levels recorded in Pattaya and the lowest in Chiang Mai and Chiang Rai. This marks a 2% year on year gain compared to FY2009, which indicates tourists are returning to Thailand.  This helped raise revenue per available room (revPAR) by 2%. While this represents progress, the average daily rate (ADR) fell from THB3,411 (US$111) in 2009 to THB3,114 in 2010, suggesting hoteliers have relied on price incentives to attract business. Profits also fell significantly in 2010, with general operating profits own 13% nationwide as departmental expenses and undistributed operating expenses climbed.

Despite the slow recovery, hoteliers in general are enthusiastic about the future. About 78% of survey respondents are optimistic in the occupancy outlook for 2011, with growth expected to be around 11%. Furthermore, 60% of hoteliers expect daily rates to increase at a rate of about 8%. The outlook is even stronger for 2012, with 75% expecting strong ADR growth.

Looking at business sources in 2010, the domestic market made up about 19% of total demand. It was the single largest geographic market for Thailand, particularly in locations such as Chiang Mai, Chiang Rai, Hua Hin, Cha-Am and Pattaya. Other key markets for the country include Japan, the United Kingdom, USA and Germany. As a region, however, Europe remains the largest geographic source for the kingdom.

Mark Elliott
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Mark Elliott
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