Phuket tourism slows even as hotels, condos booming

[webfact]

Phuket tourism slows even as hotels, condos booming

By THE NATION

 

 

Phuket looks set to weather a perfect storm as soaring hotel supply is forecast to be challenged by declining tourism demand.

 

New research from consulting group C9 Hotelworks in its “Phuket Hotel Market Update Mid-Year Edition” has revealed a development pipeline of 15,348 rooms set to enter the market over the next five years, which represents an 18-per-cent push in total supply.

 

During the first four months of 2019 – high season – year-on-year international passenger arrivals at Phuket Airport slipped by 3 per cent, while the domestic segment was down 6 per cent. 

 

The first half of 2018 had been a record-setting tourism period, with the succeeding six months experiencing a sharp decline due to the retraction of the Mainland China market.

 

Mainland China remains at the forefront of any discussion about Phuket and the segment remains volatile, with a 19-per-cent decrease registered this year from January through May. 

 

Russian arrivals have yet to fully recover. 

 

On the upside, fast-growing India tripled its tourism-arrival trajectory during the same period versus 2018.

 

 

Hotel performance has mirrored the current trend. Data reflect a 12-per-cent retraction of RevPAR, driven largely by lower market-wide occupancy. 

 

While May and September are the two lowest months for Phuket hotels, July and August are projected to experience boosts in occupancy. But the reality remains that non-high season attracts significantly lower room rates and this factor will undoubtedly suppress overall rate growth during the year.

 

The C9 Hotelworks report also highlights the growing influence of hotel-branded residences on the Phuket accommodation market. 

 

More than 50 per cent of the incoming pipeline – 8,337 units – is being developed. The majority of this is condominiums, with many being affiliated with international hotel groups via management or franchise agreements. 

 

Despite the drop in Chinese tourists, a number of Mainland real estate conglomerates have entered the island property sector.

 

Summarising Phuket’s forecasted tourism market conditions, C9 Hotelworks’ view is that, with the development of the new Greater Phuket airport by AoT in Southern Phang Nga, the long-term forecast remains positive. 

 

It’s probable that the current hotel sector will experience a cycle similar to what Bali saw between 2014 and 2018 and that new supply will eventually be absorbed on a medium-term basis. But in the shorter term, demand remains a key risk factor impacting operators and owners.

 

Source: https://www.nationthailand.com/business/30372948

 

-- © Copyright The Nation Thailand 2019-07-15

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[upena]

This is what happens when people believe the BS numbers from TAT

[Joe Mcseismic]

Invasion of Indian tourists is an "upside"? Sounds more like desperation to me.

As for C9 Hotelworks, I wouldn't believe a thing they say. They have to keep in with the hotel industry, so, as far as I'm concerned, they are part of that industry. They are either trumpeting good news, or, spinning bad news.

[Inepto Cracy]

1 hour ago, Bipolar said:

Phuket ! Hilarious! Only criminals and stupid people invest there....give it 3 years and it will be a ghosts town. Interesting to also see so many developments despite the fact that there is an issue with increasing insufficient water supply.

It will be good as a resident here, to watch all the locals eat a big slice of dung pie.

Everyone here is talking lies and boasting about numbers etc. I don't believe one word of the lies from hoteliers and tat. L O S = Land Of Sh.. ! Lies I say again lies.

[RichardColeman]

8 hours ago, webfact said:

July and August are projected to experience boosts in occupancy.

Gotta love Thai 'ignore all the available facts' enthusiasm !

[trainman34014]

Oh look; a property bubble...and we know what happened when the last one went pop !

[Joe Mcseismic]

2 hours ago, Bipolar said:

Phuket ! Hilarious! Only criminals and stupid people invest there....give it 3 years and it will be a ghosts town. Interesting to also see so many developments despite the fact that there is an issue with increasing insufficient water supply.

You really have a downer on Phuket. Great place to live, not so much if you come as a tourist.

What's up? Found out she was a he?

[Joe Mcseismic]

4 minutes ago, trainman34014 said:

Oh look; a property bubble...and we know what happened when the last one went pop !

That post just shows you haven't a clue about Phuket, or, you don't know what a property bubble is. https://en.wikipedia.org/wiki/Real_estate_bubble

 

Just like Pattaya, it's been a buyers market for at least a decade. More like stagnation with new stuff keeping prices down.

[hotchilli]

Phuket is going to catch a cold, building boom with hotels & condos going up but tourists visitors going down, prices are so high no-one really wants to live there permanently.

Boom is going to go bang very soon!

[madmen]

10 hours ago, webfact said:

More than 50 per cent of the incoming pipeline – 8,337 units – is being developed. The majority of this is condominiums, with many being affiliated with international hotel groups via management or franchise agreements

Oh dear the 4k fan room renters wont like the billions of baht being invested  by hotel groups.

fact vs anecdotal nonsense by the bar stool boys. 

Next!

[Felt 35]

Who is writing this things.........

[Joe Mcseismic]

1 hour ago, madmen said:

Oh dear the 4k fan room renters wont like the billions of baht being invested  by hotel groups.

fact vs anecdotal nonsense by the bar stool boys. 

Next!

Errrrrm.....why not? I would think they would love it. Increased supply versus stagnant demand will push prices down even further.

In fact that is already happening.

[mok199]

The chart never lies