Resorts close to Bangkok first to recover

BANGKOK, 12 May 2020: As Thailand starts to look at a purposive resumption of domestic travel, the beach resort of Hua Hin, south of the Thai capital is well poised to capture pent-up demand due to the old adage; ‘location, location, location’.

That’s one of the observations in C9Hotelworks’ latest hotel market update focusing on Hua Hin.

With the current Covid-19 crisis moving forward and tourism remains on the cusp, nearby destinations within an easy drive from Bangkok appear to have a clear-cut advantage in seeing travel re-opening. Both overnight stays and day trips look to be the agents of change in the short-term.

In the newly released report Hua Hin Hotel Market Update from C9 Hotelworks, the findings conclude that the bottom line for the destination’s international tourism ambitions is inseparably linked to the current airport expansion plan.

Looking back, Hua Hin has continued its journey down a sustainable path of tourism visitor arrivals with a 5-year CAGR of 6%. Despite the upward trajectory, last year 74% of visitors came from the domestic sector.

For hoteliers that have not been all bad news as according to data from STR, the market-wide average room rate has held at the THB4,000 level. In many of other Thailand’s resort destinations rates have been flat or in some cases retreated in the face of mass tourism and appreciation of the Thai baht.

Back on the domestic front, as the primary market feeder, this segment is mostly direct FITs, or book though OTAs and there is a strong MICE element given the close proximity to Greater Bangkok.

Flipping over to foreign demand in macro terms, this can be split into two significant segments – European ‘snowbirds’ who winter holiday in Asia and Chinese tour groups. Also, the impact of AirAsia’s direct flights between Hua Hin and Kuala Lumpur in Malaysia emerged as a factor. In 2019 passenger arrivals tallied at 44,613 and the airlift is creating a new profile for Hua Hin as a destination.

Two crucial parts of the current airport expansion come into focus. Firstly, the runway extension and additional apron space that will accommodate larger intra-regional aircraft. Secondly, the development of the airport terminal itself that would take two to three years to complete.

Another critical infrastructure project that needs to be looked closely at is the high-speed rail system that is underway and the completion of a double-track.

C9’s report also highlights five new hotels in the pipeline with 1,627 keys. Noteworthy is a growing long-stay segment that is pushing into the villa rental segment. By location and catchment of key demand generators, wellness and retirement markets are poised to grow.

To read and download the full report click on the following link:
https://www.c9hotelworks.com/wp-content/uploads/2020/05/hua-hin-market-update-2020-05.pdf

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