Mid-Year Phuket Hotel Market Report By C9 Hotelworks
C9 Hotelworks has released its new Phuket Hotel Market Update – Mid Year Edition 2021.
International visitors are an important foundation in driving tourism growth in Phuket. According to the Airports of Thailand, international passenger arrivals increased for ten consecutive years to reach a record of 5.3 million in 2019 before decreasing by 80% to 1.1 million in 2020 due to travel restrictions under the COVID-19 pandemic. While this year total passenger arrivals between January to July dropped to 0.4 million from 1.9 million passengers in 2020.
In FY2020, the market-wide ADR was propped up by the government’s ‘We Travel Together’ program. However, the Bangkok travel restrictions have effectively negated the domestic market and made the island reliant on Sandbox travelers. This has pushed market-wide demand into double digits, though rates have dropped.
Phuket became the first province in Thailand to welcome back international visitors without quarantine requirements. Based on the Tourism Authority of Thailand (TAT), the reopening of Phuket quadrupled its room night demand in July, with further gains registered in August.
Due to the ongoing pandemic, 67% of pipeline projects have been delayed, mostly to 2023-24. The West Coast remains the most popular development area, led by Kamala, Patong, and Layan. Despite the ongoing COVID impact on hotel owners, only two significant transactions of hotels occurred this year, though more are expected over the next 12-18 months.