Despite the decline the tourism sector has
experienced since the military seized power in May, investors have concluded
some big deals at hotels in Bangkok and major tourist destinations.
Andrew
Langdon, executive vice president for the hotels and hospitality group at Jones
Lang LaSalle (JLL), said Thailand remained attractive for hotel investment
despite the drop in arrivals to the Kingdom in the wake of the coup on May 22.
"There
are still many local and foreign investors looking for new investment in
Thailand. We are now working on best investment solutions for them," he
said.
He
added that JLL helped local investor reach two big deals just after the junta
seized power from the elected government but declined to give further details.
However,
a hotel analyst confirmed that the deals were Hilton Hua Hin Resort and Spa and
a hotel in Bangkok's Sukhumvit area. Hilton Hua Hin transferred ownership to a
big local investor, while details about the property in Bangkok have not been
disclosed yet.
Earlier,
before the coup, JLL facilitated a transaction for a hotel in Khon Kaen in the
Northeast, but it was not a big property.
Properties
sold in Bangkok last year were Centre Point Saladaeng and the 108-room Swiss
Park Hotel.
Also on
the market with JLL are leasehold rights to the 243-room Ma Hotel Bangkok on
Surawong Road, which may be expanded to 253 rooms. Another one is a 129-room
international-brand serviced apartment complex.
Langdon
said demand for hotel investment increased over the previous three years, and
the situation now looked positive again as the political mayhem subsided.
JLL
found that average hotel occupancy in Bangkok dropped by 50 per cent in the
first half year on year, but surprisingly the average daily rate (ADR) grew by
2 per cent. Moreover, revenue per available room (RevPAR) at hotels in the
capital grew by 25 per cent during the first six months. These figures showed
that operators could manage their operating costs and keep rates high even
during a crisis.
JLL has
facilitated hotel transactions worth Bt25 billion over the past four years.
Half of those properties were bought by foreign investors, particularly from
Singapore, Malaysia and Hong Kong.
An
investor from Malaysia bought Moevenpick Phuket, a Singaporean investor now
owns Buddy Samui, and a Hong Kong investor bought Sofitel Silom in Bangkok.
According
to JLL research, 4,857 rooms are expected to be added to the hotel market by
the end of 2016. Most openings over the next three years will be concentrated
in the upscale segment, with Sukhumvit being the most prominent location for
new investment.
There will
also be major renovation at Four Seasons Hotel Bangkok next year on a budget of
Bt300 million. Minor International's new brand Avani this year will take over
management of the Atrium Bangkok.
Suchat
Sritama
Business & Investment Opportunities
Saigon Business Corporation Pte Ltd (SBC) is incorporated
in Singapore since 1994.
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