The number of hotel rooms in Bangkok grew 12.1% year-on-year with the completion of six new hotels in the first half of 2013, lifting the total to 37,500 in downtown Bangkok, according to the latest survey by CBRE Thailand, a leading international property consultant.
CBRE estimated the would be an 4,400 additional keys by the end of 2015, bringing the total to almost 42,000. This projection represents an 11.9% increase on current figures.
Almost all of the new hotels are high-rise buildings. The most popular area for hotel development remains the Ploenchit/Sukhumvit area with 65% of the total hotel supply and four out of six new hotels opened in this area. The Silom/Sathorn area accounted for 21% of the total hotel stock while the Riverside area accounted for 14%.
Approximately 2,250 new rooms at various levels of accommodation will be completed in the second half of 2013.
CBRE said the level of competition due to new openings is still high, although the supply trend this year is certainly encouraging for the industry with the number of construction permits declining significant over the past two years.
“The big challenge for hotel owners is to raise the room rates which have not grown significantly for the last five years. The second half of 2013 may finally see the growth in visitor arrivals outpacing new supply allowing owners to raise rates,” said James Pitchon, head of CBRE Research & Consulting, Thailand.
He said there is a significant opportunity for economy hotels in Thailand as many more visitors want consistency in quality as well as value for money but currently there are a limited number of players with branded product in this market.
Several hotel operators have announced plans to open budget hotels in Bangkok. Central Plaza Hotel (CENTEL), who are known as a high-end hotel operator in Thailand under the brand “Centara”, has jumped into this segment and introduced their new economy brand ”COSI”. The Erawan Group (ERW), a listed hotel developer, has also introduced their new budget hotel brand “Hop Inn”, targeting to open 30 Hop Inn hotels in Thailand.