Europe's worsening economic outlook won't affect the hotel situation in Pattaya, as most guests arrive from other countries within Asia or are domestic tourists, according to LH Mall and Hotel (LHMH).
Kitti Worrabanpott, managing director of LHMH, said Pattaya isn't only known for its nightlife, as it has transformed itself into a friendly destination for family and business meetings.
As the European Commission this week cut the Eurozone's growth forecast, while Germany is projected to slip into recession this year, Mr Kitti said this situation might impact other hotels that target the European market.
At present, LHMH has two hotels in Pattaya and four hotels in Bangkok under the Grande Centre Point brand.
Grande Centre Point Space Pattaya, LHMH's latest property which opened in August 2022, recorded an occupancy rate of more than 90% in the first six months of 2023.
While the hotel's main target had been domestic guests this year, the share of foreign guests has gradually increased to reach 60%. Most foreign visitors were from China, Hong Kong, Japan, other Southeast Asian countries, and the Middle East.
Among all of LHMH's properties in Bangkok, 80% of foreign guests were from the Asia-Pacific region. They tend to come for business trips or leisure travel due to the short distance between their home countries and Thailand, he said.
Regarding China's economic slowdown, Mr Kitti said Grande Centre Point would still benefit from the luxury and upscale segment, which would remain unfazed by economic challenges. Chinese national were defined as the biggest spenders from within this group, he said.
As the government plans to launch a visa-free scheme within this year, it would benefit overall tourism because making the travel process easier would encourage people to choose Thailand.
LH Hotel Leasehold Real Estate Investment Trust (LHHOTEL) will invest in the leasehold rights of two Grande Centre Point properties in Pattaya with a total value of no more than 9.8 billion baht.
It would borrow no more than 4.5 billion baht from financial institutions. The move will diversify the company's portfolio, on top of three existing assets in Bangkok.
The three hotels in Bangkok had an average daily rate that exceeded 2019's level by 20% during the first half of this year.
Monrat Phadungsit, president of Land and Houses Fund Management, the manager of LHHOTEL, said the dividend yield gap for REIT, compared to 10-year government bonds, stood at an attractive level of around 4.8%.