The Thai resort island of Koh Samui is
experiencing growing pains as hotel supply hits 16,069 rooms
according to the Samui Hotel Market Update, an extensive research
project into the market undertaken by Thailand consulting firm C9
C9 Hotelworks Managing Director, Bill
Barnett, said the prevailing challenge for the destination was a
distinct lack of direct international flights, with domestic
flight traffic representing 91% of all air traffic to the island
"The resonating lack of international airlift
is stalling the island's move to become a mainstream tourism
destination," Mr Barnett said. "However, 541 internationally
branded rooms opening in the next 15 months is poised to have a
positive impact and could move the industry up the value chain."
The report highlights performance metrics due to price
discounting, which impacted rates through a 19% decrease in 2009
compared to 2008. A domino effect saw occupancy decline by 5% and
RevPAR down 20%.
During the first six months of 2009,
overall arrivals to Koh Samui slumped 23%, attributed mainly to
political concerns. A strong second half upswing in occupancy fell
short of clawing back the shortfall. Emerging growth markets were
Eastern Europe, Malaysia, Indonesia, India and the Middle East.
"Discounting on the heels of a dynamic shift to a greater
reliance on short-haul Asian based visitors is creating volatile
trading market conditions. The short-term outlook for market
absorption of new hotels could see supply outpace demand," added
Mr Barnett. "Despite challenges during the current
infrastructure catch up period, an imposed transformation led by
significant resorts such as the new W Retreat provide an upbeat
longer term outlook."
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