Chiang Mai "economy"

[westbounder]

Hi,

I am now back in the US for a short time. I am returning to Chiang Mai in September.

I just heard from a friend living in Chiang Mai that the streets are void of Farang tourist and the economy is very bad.

He also said that nobody has much work and there a lot of businesses and Hotels up for sale.

I heard Loi Kroh road is like a ghost town and the shops and bars are empty.

I am curious how the people here on Thai Visa in Chiang Mai view this and what there opinion is about the economic future in Chiang Mai.

Thank You

[wolf5370]

Hi,

I am now back in the US for a short time. I am returning to Chiang Mai in September.

I just heard from a friend living in Chiang Mai that the streets are void of Farang tourist and the economy is very bad.

He also said that nobody has much work and there a lot of businesses and Hotels up for sale.

I heard Loi Kroh road is like a ghost town and the shops and bars are empty.

I am curious how the people here on Thai Visa in Chiang Mai view this and what there opinion is about the economic future in Chiang Mai.

Thank You

Just came back from Loi Kroh (Guitarman) - it was fairly packed. Left at quater to one and walked back along the road couple of hundred yards to the car and saw several farangs meandering about. Saw even more on the journey home on the streets and in tuktuks. Not as busy perhaps as usual for this time of the year, but no ghost town.

[IanForbes]

Just came back from Loi Kroh (Guitarman) - it was fairly packed. Left at quater to one and walked back along the road couple of hundred yards to the car and saw several farangs meandering about. Saw even more on the journey home on the streets and in tuktuks. Not as busy perhaps as usual for this time of the year, but no ghost town.

That's good to hear. It means my girl friends are surviving. I'd hate to hear that my favorite gals went back home for good.

[Ulysses G.]

I have a lot of friends who are in business and they are all doing OK for this time of year, although slower than in the past. The Duke's is kicking butt as usual -in both locations.

Things are not as good in Chiang Mai as they could be, but they are far from being the disaster that some people would prefer.

Sometimes, slow and steady wins the race.

[hml367]

I have a lot of friends who are in business and they are all doing OK for this time of year, although slower than in the past. The Duke's is kicking butt as usual -in both locations.

Things are not as good in Chiang Mai as they could be, but they are far from being the disaster that some people would prefer.

Sometimes, slow and steady wins the race.

I am just curious UG....... are any of those friends involved with the new big hotels? Or any with the large investment new businesses in Chiang Mai? I am serious and not trying to invoke any arguments...

I know the Loi Kroh, Duke's, and night establishments are talked about often...... I am not knowledgeable enough to know just how much effect they have on the total Chiang Mai economy.

MSPain

[Ulysses G.]

No, you are right, I am mostly refering to small businesses and hotels oriented for farangs and Thais, however, I would have told you that building those new hotels was idiocy even when the economy was going full steam - all of these five star hotels are just not needed in Chiang Mai

The Centara Duang Tawan hotel is doing quite well though. The price is cheap for what you get and the pool and fitness center are great for tourists. Good quality lodging for a reasonable price works almost every time.

Edited July 5, 2009 by Ulysses G.

[hml367]

No, you are right, I am mostly refering to small businesses and hotels oriented for farangs and Thais, however, I would have told you that building those new hotels was idiocy even when the economy was going full steam - all of these five star hotels are just not needed in Chiang Mai

The Centara Duang Tawan hotel is doing quite well though. The price is cheap for what you get and the pool and fitness center are great for tourists. Good quality lodging for a reasonable price works almost every time.

Hello.

Again, I don't have the knowledge to know whether building those big ticket items was right or not. People from big ticket arena think in the big ticket terms and people from the "smaller" ticket arena think in their own terms. In my opinion, they both have to work for the economy to be sufficient.

I think back to when I first started coming to Thailand and they were building a lot of high rise buildings in Bangkok and (that I noticed) subdivisions in Chiang Mai. Then the economy fell out...... I still see many of those projects laying in disuse.

My next observation is that the clientele of Loi Kroh, for example, are not the same clientele (in more ways than one!) of the big ticket arena.

Thank you for your answers.

MSPain

[Ulysses G.]

Building numerous luxury hotels in a town that already has too many, just does not make sense to me. However, there are rumors of a brand new shopping mall - a "high ticket" item - and that could certainly fly - even with all of the others out there.

You are right about the men who mainly come here for the nightlife. They are not interested in the top hotels, but they do tend to stay in middle class hotels - like the Centara Duangtawan - and spend a lot of money on the girls, golfing, hotels, food and flights around the country. They far outspend other middle class tourists and backpackers and their money is nothing to be sniffed at.

[hml367]

Building numerous luxury hotels in a town that already has too many, just does not make sense to me. However, there are rumors of a brand new shopping mall - a "high ticket" item - and that could certainly fly - even with all of the others out there.

You are right about the men who mainly come here for the nightlife. They are not interested in the top hotels, but they do tend to stay in middle class hotels - like the Centara Duangtawan - and spend a lot of money on the girls, golfing, hotels, food and flights around the country. They far outspend other middle class tourists and backpackers and their money is nothing to be sniffed at.

As I said, UG, in my opinion BOTH have to work. As for how much which class spends, again, I don't have all the knowledge. However, I think if someone checked how much value was shipped out of Chiang Mai to other countries, that value would not be sniffed at either.

Also as I said, I am not trying to start any debates.... I think the whole picture has to be taken into account. I have a feeling that the Thai citizenry far outspend both of the aforementioned sectors. Then, one has to take into account that some of the higher income Thais are making some of that money from both the aforementioned sectors also.

This is hurting my head! Again, Thanks for the answers. I'm going to rest.

MSPain

[Ulysses G.]

I am not trying to hurt your head, but I still do not see why the new super-expensive hotels would work, even if the economy was better. It is my feeling that they would just fail slower and it would not be so noticable. They are just not needed.

I do have a friend who does a lot of shipping goods to other countries - the biggest business of its type in CM - and he is also doing enough business to survive and live fairly well, but not enough to jump up and dance!

[Ajarn]

No, you are right, I am mostly refering to small businesses and hotels oriented for farangs and Thais, however, I would have told you that building those new hotels was idiocy even when the economy was going full steam - all of these five star hotels are just not needed in Chiang Mai

I visited Pai last week for the first time in a year and I drove around a bit. I saw that Pai is exploding with so many resorts and guesthouses. Far too many to support the amount of people coming into Pai. Far too many too support those farangs and Khon Thais who could get to Pai. Curently there is only the bus (very few) or the long drive over the mountains, or the small plane that goes to Pai (where?) Interesting that they built a special hiway to Mae Hong Son that bi-passes Pai completely. Lots of money being spend in Pai for what? What they need is an airport the size of Chiang Mai, not a one path dirt landing field that can't support jet flights. No plans that I have heard of for a commercial airport in Pai.

[PeaceBlondie]

There's much more to the economy than tourism. Millions of baht for new homes, cars, private schools, new furniture and laptops, etc.

[hml367]

I am not trying to hurt your head, but I still do not see why the new super-expensive hotels would work, even if the economy was better. It is my feeling that they would just fail slower and it would not be so noticable. They are just not needed.

I do have a friend who does a lot of shipping goods to other countries - the biggest business of its type in CM - and he is also doing enough business to survive and live fairly well, but not enough to jump up and dance!

Hello, UG.

Sorry if I gave the impression that it was you hurting my head... it is not... It is the thinking!

And I am not taking any sides in the discussion, just giving my observations.

You mention DuangTawan..... I first saw the shell of the building about 1996. The structure was complete, I believe at that time. Only the insides were not complete. I saw that structure for many years. Then it finally opened. It seemed such a long time to me. I figured out that I shouldn't put MY business thinking onto the Chiang Mai way of business. There were, and are, certainly many successful Thai business people.

Another observation of my own: There may be more than "opening a hotel" to the reason for actually building the hotel.

I came here from Hawaii. Some years ago a Japanese company built an extremely large hotel complex in the area I lived. The economy in the US took a downturn shortly thereafter. The Japanese company sold the resort complex for less than what they spent to build it. Did they lose? Well, they used Japanese yen converted to US dollars to build it. Then received US dollars and subsequently converted those dollars to Japanese yen. They also used their own contstruction companies to build the complex. I am fairly certain they also used some other companies they may have been involved with for the completion of the complex. My point is, we will never know the full picture of such a project.

I am not disputing your assertion that new hotels will fail. If anyone knows the future for sure, they would be very well off indeed! And by the way, some people earned money building those hotels. Not long ago I went in the new hotel abutting the Night Bazaar. In the time I was inside the hotel I can't remember seeing more than 5 or 6 people that I would consider having been guests there.

Am I correct that you are involved in a business in Chiang Mai? That would certainly qualifie you much more than me to discuss any of this. As I said earlier, I am just posting my observations.

MSPain

[Ulysses G.]

Another observation of my own: There may be more than "opening a hotel" to the reason for actually building the hotel.

Very good point, especially in Thailand.

I own the Gecko Books chain, but I know very little about any business other than bookshops in Chiang Mai.

[Ulysses G.]

I saw that Pai is exploding with so many resorts and guesthouses. Far too many to support the amount of people coming into Pai.

Pai has mostly been weekend Thai guests from Bangkok since that famous Thai movie about Pai came out. I don't see how all of those people with businesses there can stay afloat when the town is empty most of the time.

[Asmerom]

I own the Gecko Books chain, but I know very little about any business other than bookshops in Chiang Mai.

I must say I'm astonished at your saying that yet another shopping mall in Chiang Mai "would fly". I wonder if you're refering to that huge building site on the South Side of the Moat with a wall of pictures advertising ; guess what? more TV's, mobile phones, radios,recorders, CD players, washing machines, fridges. Every time I go past it I think ,is this just what Chiang Mai needs right now-another outlet for electronics?

Are there shoals of people out there who just can't find a place selling TV's or mobile phones? Everytime I go past such a place, of which there seem to be hundreds, there's always a crowd of idle assistants leaning against the stuff and not a shopper in sight ,where making a simple query ensures being quickly surrounded by half a dozen eager young faces anxious to relieve their boredom.

But you're the business man and presumably have good reason to make what to me seems that surprising prediction. Interesting. But maybe I've misunderstood, as you did refer to "high end". Perhaps you had some other site in mind. After all, the site on the South Side looks like more than just a rumour.

[Ulysses G.]

I don't consider myself an expert in any business other than books and I am just guessing about another mall.

It does seem to me that the two main shopping malls are quite busy much of the time and they are both quite old. A new, really fancy one might grab a lot of their customers if it was interesting with lots of trendy shops. Thais go for new stuff.

Edited July 5, 2009 by Ulysses G.

[daoyai]

That project next to the Chinese consulate is an established CM shop moving to a new location.

I think the big new hotels were built on tourism projections made during the recent boom years, I too remember the Waikoloa project built foe $350,000,000 sold for $35,000,000.

[Asmerom]

That project next to the Chinese consulate is an established CM shop moving to a new location.

Would you mind briefly elaborating? Which established CM shop is moving there? Just a thought-maybe Siam TV at a guess.

Edited July 5, 2009 by Asmerom

[daoyai]

Good guess, you are correct sir. Siam TV