Monday, April 06, 2020

Experts see bright outlook for Samui hospitality sector

Oct 16. 2012
Facebook Twitter


Experts are upbeat about the prospects for the hospitality industry on Koh Samui this year and in the future, in line with the national tourism outlook and despite the European financial crisis continuing to pose a risk to the sector.

This year saw stronger demand on the resort island during July and August, which have a profound impact on annual trading figures. Expectation is therefore that the overall annual occupancy rate will move up by a few

 percentage points from the 67-per-cent level achieved in the first half, said Bill Barnett, managing director of C9 Hotelworks, the major Asia-Pacific hospitality asset management and consulting firm.

Fundamental supply and demand prospects on Samui are also stable, which counters a broader oversupply problem that is being widely mentioned at present, he said.

Based on 8-per-cent occupancy growth, there are only three major new hotel developments in the pipeline with a total of 371 rooms over the next two years, adding less than 3 per cent to new supply on Samui. This contrasts sharply with the resort island of Phuket, where there are more than 5,000 new hotel rooms in the pipeline, resulting in an 11-per-cent spike in supply, he said.

However, the good Samui business trend seems not to be spread equally across all hotel segments. According to research conducted by C9 Hotelworks, the occupancy rate during the first half of this year was 73 per cent for upscale hotels, followed by 69 per cent for mid-scale properties and 59 per cent for luxury hotels.

The occupancy rate at budget and economy hotels was only 52 per cent, partly because of a lack of low-cost carriers serving the island.

The overall market-wide occupancy rate was at its highest level since 2008, at 67 per cent compared with 59 per cent in the same period last year.


“Looking forward, the restrained air traffic may be a blessing in disguise to the island, as restricting mass-tourism growth could enhance its natural appeal,” Barnett said in a press release accompanying the research. “While the competitive markets of Phuket and Bali are overrun with skyrocketing numbers, Samui’s positioning is gradually shifting upward to a niche resort destination.”

For the whole of this year, the number of foreigners visiting the island is expected to be almost 900,000, against about 800,000 last year.

Domestic visitors are forecast at just over 800,000, up from about 720,000 in 2011.

During the first half, arrivals at Samui Airport were recorded at 455,778 passengers, 92 per cent of them coming in on domestic flights.

During the period, the average length of stay among foreign tourists increased to 5.5 days against 4.8 days, year on year. The highest growth was generated from Eastern Europe and Malaysia, at 83 per cent and 22 per cent respectively compared to the same period last year.

The average Samui room rate was US$144 (Bt4,420), a slight year-on-year decline of 1 per cent. A 12-per-cent surge in revenue per available room was attributed to occupancy growth.

Meanwhile, although the outlook on the island is good, Barnett said promoting it as a hub for MICE (meetings, incentives, conventions and exhibitions) was not a good idea.

Instead, the island should position itself as a niche destination. In fact, it does not have the large-scale infrastructure for handling large groups, nor the airlift or facilities for MICE events, he said, adding, “Samui needs to work from its strong points, not look to match Phuket, Pattaya and Chiang Mai.”

Facebook Twitter
More in Business
Editor’s Picks
Top News