Bangkok to see 6,900 new hotel rooms in the second half of 2021
The midscale segment will account for 42% of the new supply.
According to Airports of Thailand (AoT), Suvarnabhumi and Don Mueang airports welcomed approximately 85,000 international passengers and 1.7 million domestic passengers as of YTD March 2021, registering y-o-y decreases of -98.5% and -57.0%, respectively. As a result, the total number of passenger arrivals dropped by 81.9% in 1Q21 when compared to 1Q20.
JLL says with the improving distribution of vaccines globally, the government had plans to open international borders to vaccinated tourists without quarantine from October 2021 onwards. However, with the third pandemic outbreak hitting the country at the beginning of April, reopening plan may be affected and delayed.
Here’s more from JLL:
Bangkok’s new hotel supply experiences a slowdown in 1Q21
As a number of hotels saw their initial opening dates shifting from 2020 to the end of 2021, Bangkok is slated to welcome a large number of hotel rooms during the second half of 2021 accounting for approximately 6,900 keys. With the onset of the second wave at the beginning of the year, Bangkok did not witness any hotel openings during the first quarter of 2021.
From 2020 to 2021, nearly 11,500 hotel keys are expected to enter the market with majority of the future supply in the midscale segment accounting for 42% of the total supply followed by upscale (37%), serviced apartments (11%), and luxury (9%) properties.
As at YTD Mar 2021, revPAR for luxury hotels continues to fall
As at YTD March 2021, luxury hotels in Bangkok continued to show a negative performance, with revenue per available room (RevPAR) dropping by -84.4% y-o-y to THB 508. This can primarily be attributed to decreases in both occupancy and average daily rate (ADR) declining by -33.8 percentage points to 14.1% and -47.1% to THB 3,607, respectively, during the same period.
Similarly, midscale and upscale hotels in Bangkok experienced a y-o-y decline in RevPAR of -71.8% to THB 290 and -75.4% to THB 435, respectively, as at YTD March 2021.
Outlook: Performance to be impacted by the third outbreak
With Thailand registering the highest number of daily cases since the beginning of the pandemic and the additional restrictions implemented by the government in April, hotel performance across each segment are expected to remain sluggish in 2Q21. Some hotel owners decided to close their properties during this challenging period which is also characterised by the low season in the country.
Despite the ongoing uncertainties, Thailand is still aiming to reopen its international borders to vaccinated visitors without quarantine with first Phuket from July onwards followed by the rest of the country from October onwards.
Note: Bangkok Hotels refers to Bangkok's luxury hotel market.