Room rates drop as Thailand’s hotels feel the Covid pinch

The devastating economic effects of the Covid-19 crisis continue to make themselves felt as hotels are forced to reduce their rates significantly in an effort to lure guests. Speaking to the Bangkok Post, James Kaplan from asset investment and management company, Destination Capital says that, unlike the economic crash of 1997, hotel revenue took a hit at the height of the coronavirus outbreak, when a lack of tourists forced them to close their doors temporarily.

While Thailand appears to have been successful in suppressing, and containing, the virus, lingering uncertainty over when tourism and the overall economy might bounce back, coupled with the lack of an effective vaccine, means hotels are having to drop their prices. Kaplan predicts the number of international arrivals will not match 2019 levels until at least 2023.

The absence of a vaccine against Covid-19, added to strict quarantine requirements and struggling airlines, mean tourists are not confident about travelling, and, while the much-discussed travel bubbles may attract some, this will not be enough to provide airlines and the sector as a whole with the significant jump-start required.

Kaplan says his company hopes to have a portfolio of between 12 and 15 hotels within the Asia-Pacific region within 18 months. The idea is to have the properties renovated and rebranded, marketing them to capital investors in Thailand and elsewhere. Such an investment would mean these hotels could reopen, creating more jobs. He adds that Thailand is the primary focus, particularly properties in the tourist hotspots of Bangkok, Hua Hin, Phuket and Pattaya.

SOURCE: Bangkok Post