LOCATION REPORT BANGKOK REBOUNDS For Thailand’s largest and most populous
city, the challenge is to convert visitor numbers into hotel stays. STR Global estimates there are 242 hotels in Bangkok offering a total of 60,465 rooms. This is set to increase by 15.7% in the next three-to-five years as 45 properties in the pipeline add another 9,520 rooms. Year-to-date RevPAR, in the meantime, stood at a relatively low THB2,324 in February. “The RevPAR figures do indicate 6.7% annual growth, with the bulk of this occupancy driven, proving that demand is recovering,” says STR Global’s Area Director – Asia Jonas Ogren. “Having said that, market-wide occupancy is still in the low 70s, somewhat limiting the ability of hotels to raise rates.” Since the Thai Hotels Association suggests even lower average occupancy – just above 60% – it is clear Bangkok has an issue with supply and demand. Ogren adds: “Roughly half of the pipeline is scheduled to open in the next 12-to-14 months so operators are likely to have a tough time driving performance in the short to medium term despite continuing demand.” Thai hospitality veterans have voiced their
concerned about a pipeline deemed to be on steroids, particularly at the luxury end. Construction of ‘prestige-driven’ four- and five-star properties continues unabated with this sector already under extreme rate pressure because of the imbalance between supply and demand. A significant rise in visitors from East Asian nations, who now account for 54% of international visitors, suggests that budget and mid-scale accommodation would be better placed to cater for the shifting tourist profile. Indeed Bangkok-based developer Erawan Group has diversified into economy hotels in response to tourist traffic from BRIC economies Russia, India and China. Embedded into the Thai hospitality
landscape, international chains are active across sectors. Accor, for example, which has 21 hotels in Bangkok, will elevate this total to 23 with the opening of an Ibis and Mercure by year-end. Other launches, though, fall firmly into the mid-scale and luxury categories. Starwood Hotels & Resorts will be represented by all its major brands when the W is unveiled in December under an agreement with Golden Land and Istithmar World. Architecture for the 407-room W Bangkok is by P&T Group (formerly Palmer + Turner) with interiors by SODA Thailand and AvroKO. Park Hyatt, Hilton’s Waldorf Astoria and Edition are also expected to debut by 2015. Leading Thai group Centara Hotels &
Resorts, meanwhile, is due to open a second Bangkok property under its four-star value brand, Centra, this summer while the Okura Prestige Bangkok introduces Japan-based Okura Hotels & Resorts to Thailand. On a smaller scale, Taiwan-born Eugene Yeh debuts an eight-suite boutique hotel called Cabochon, a project he both owns and has designed in colonial style. Regarded as the forerunner of
‘quintessential’ Thai resorts, Anantara has strengthened its Bangkok presence after the rebranding of a riverside property at the end of 2011. Previously run as a Marriott under a franchise agreement for several years, the 407-room waterfront retreat has been transferred to the Anantara portfolio, which as the in-house brand of owning company Minor International, expects to encompass 50 properties across Asia, the Indian Ocean and Middle East within four years. Set among an extensive network of tropical gardens situated in the midst of the city, Anantara Bangkok Riverside Resort & Spa is the subject of a full- scale renovation due for completion in 2013. “Opportunity in Bangkok arises if you are
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able to make your hotel stand out from the others, either by offering something different or by being the best at what you do,” Heinecke comments. Structural improvements, FF&E upgrades and the refurbishment of all rooms in the South Wing have been led by Samantha Lightbody, Director of Abacus Design, who follows in the footsteps of father John Lightbody, the original designer of the resort. Incorporating touches of Thai culture into her contemporary scheme, Lightbody has conceived spacious rooms featuring Thai silk furnishings, teak furniture with ancient script etched on backlit mirror panels and black and white prints of the river to evoke a feel of ‘Old Siam’. Anantara’s General Manager Francis
Zimmerman acknowledges there is a tough road ahead for hoteliers in the next few years if the pace of development does not slow, but he also believes in the country’s fundamental pulling power. “Brand Thailand is exceptionally strong and will remain one of the most popular destinations in Asia, especially as regional travel increases,” he says. “Bangkok will need to look at rejuvenating its appeal, however, by introducing something new to the tourism infrastructure, for example, a major expo or event.” Contributing a viewpoint from a related industry, Thai Airways General Manager for the UK and Ireland, Wit Kitchathorn, adds: “Passenger movement in and out of Thailand at the end of the last fiscal year showed positive growth despite challenges presented by the worldwide economy and risk management of natural disaster. Geographically Bangkok is suitable for transferring to neighbouring countries, as well as Australia and New Zealand, but there is still plenty of room to expand its status as one of the most important Asian holiday hubs.”
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