amcham luxury resort markets phuket and samui april 21, 2010
TRANSCRIPT
AMCHAM
LUXURY RESORT MARKETS PHUKET AND SAMUI
April 21, 2010
• Phuket Trends and Outlook:
• 2009 at a Glance
• Q1 2010 Performance Snapshot
• Going Forward: Key Challenges
• Samui Trends and Outlook:
• 2009 at a Glance
• Going Forward: Key Challenges
• Resort Island Property: Updates and Trends
What’s ahead?
Trends and Outlook
• Annual visitor arrivals bounced back to 2007 level of 2.9
million.
• Visitors were more price sensitive due to a global economic
crisis exploding in H2 2008.
• Discounting rates became a strategic tool to draw guests.
• Signs of a travel rebound emerged in the final months of the
year as economies around the world strengthened.
Phuket2009 at a Glance
Phuket2009 at a Glance
PhuketQ1 10 Performance Snapshot
• Hotel occupancy and RevPAR ahead of 2009 created a strong
base for performance pick up.
• Q1 2010 market wide occupancy was closed at 85% reflecting a
tremendous improvement of 25% from Q1 2009 and 20% from
YTD 2009.
• Example of uplift Patong average room rates closed at THB
4,590 (about USD 145) showing 17% increase versus YTD 2009.
PhuketGoing Forward: Key Challenges
• Potential for oversupply in midscale and upscale.
• Low season to impact annualized figures with political unrest
hitting China market and MICE rebound.
• Airlift growth has created strong volume fundamentals but key
concerns on Thai airways pricing increase and flight reductions.
• Branded properties will penetrate markets and create
destination promotion benefits but new openings to set back
rate growth to 2011.
Trends and Outlook
Samui2009 at a Glance
• A domino effect with an occupancy decline of 5%, average
room rates 13% and RevPAR 20%.
• Inverse growth trends between increased Asian visitors and a
decrease in European’s.
• Airlift limitation created a major reliance on market as 91% of
arrivals were from domestic flights.
Samui2009 at a Glance
SamuiGoing Forward: Key Challenges
• Environmental control over Samui airport limiting a maximum
of 36 daily flights constrains sustainable visitor growth.
• Lack of developed tourism demand generators and attractions
inhibit shift into mass tourism model.
• International branded hotels create induced demand for the
destination.
• With incoming supply the market could see supply outstrip
demand.
Updates and Trends
Resort Island Property
Resort Island PropertyUpdates and Trends
• 2009 was the year “failure to launch” said it all.
• Resales became a significant segment.
• Sharp shift in developer profile from foreign to Thai.
• Limited distress but some banner failed projects.
• Domestic buyers on rise creating low end products but
increasing market share.
• Off plan branded residential sluggish, while urban demand up.
• Property funds to become key equity drivers.
2010?Keep the Faith