APPD Market Report Article

Bangkok

December 1, 2021

-72.6%

THB 427

RevPAR
Falling

Foreign arrivals to Bangkok decline by -96.1% y-o-y in September

  • According to Airports of Thailand (AoT), Suvarnabhumi and Don Mueang airports welcomed approximately 227,000 international passengers and 2.9 million domestic passengers as of YTD September 2021, registering a y-o-y decrease of -96.1% and -57.4%, respectively. As a result, the total number of passenger arrivals dropped by 75.4% in 3Q21 when compared to 3Q20.
  • Following the July 2021 sandbox programs launched in Phuket and in Koh Samui, the country reopened its borders from November 2021 and is now currently allowing fully vaccinated foreign tourists from 46 low risk countries to enter Thailand without mandatory quarantine.

Limited new hotel supply enters the Bangkok market in 2021

  • While Bangkok was slated to welcome over 4,000 new hotel rooms throughout 2021, there was only two new hotel openings, namely the 94-key Quartier Hotel Sukhumvit 49 and Maitria Hotel Rama 9 Bangkok, as numerous owners decided to delay their targeted opening in 2021 due to the ongoing COVID-19 situation.
  • Nevertheless, a significant increase in hotel supply is expected until the end of 2023, with nearly 14,000 additional rooms scheduled to open. The majority of the future openings will be concentrated in the midscale segment (48.0% of future room supply), followed by upscale (41.0% of future room supply), luxury (9.8% of future room supply), and budget (1.2% of future room supply).

As at YTD September 2021, luxury hotel RevPAR continues to fall

  • As at YTD September 2021, luxury hotels in Bangkok continued to show negative performance, with revenue per available room (RevPAR) dropping by -72.6% y-o-y to THB 427. This can primarily be attributed to decreases in both occupancy and ADR, declining by -13.0 percentage points to 11.6% and -41.9% to THB 3,674, respectively, during the same period.
  • Similarly, midscale and upscale hotels in Bangkok experienced a y-o-y decline in RevPAR of -40.3% to THB 291 and -54.4% to THB 424, respectively, as at YTD September 2021.

Outlook: Industry to experience signs of revival as the country reopens

  • As hotels in Bangkok are largely reliant on international demand, we expect performance to recover once the country will be able to allow more foreign tourists to enter. Despite the ongoing uncertainties, Thailand opens its borders in November to fully vaccinated travellers from 46 low risk countries. We anticipate further international business to pick up in 2022.
  • Though Thailand is gradually reopening the country to overseas arrivals from November 2021 onwards, the recovery pace will also depend on the global pandemic situation and the return quarantine restrictions from key feeder markets. As for Bangkok, with the government’s plan to reopen in November, it is expected to see an initial pick-up in demand during the holiday season in December 2021.

Note: Bangkok Hotels refers to Bangkok's luxury hotel market.

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