High-end hotel operators are preparing to raise room rates during the high season as tourist numbers are projected to surge in the next few months, while hotels in the mid-tier and lower continue to struggle, according to the hotel operator sentiment index.
Thienprasit Chaiyapatranun, president of the Thai Hotels Association (THA), said the average occupancy rate in September was 55%, down seven percentage points from August and lagging the corresponding period in 2019, which tallied 63.4%.
He said each hotel segment has a different rate of recovery, as three-star hotels and below posted only 45% occupancy in September, while four-star hotels and above recorded 58.7% occupancy.
By region, the occupancy rate of hotels in the North plunged from 50% in August to 25.7% in September, attributed to severe flooding in key areas of many provinces. Hotels in the central region posted the highest occupancy rate of 64.4%, followed by the East at 57.1%, while lodging in the South and Northeast both recorded 49%, said Mr Thienprasit.
He said most hotels will take advantage of the high season and adjust their room rates, but the growth should be less than 10%.
Mr Thienprasit said only four-star hotels and higher have the potential to increase their room rates by more than 20%, based on a more promising track record in the third quarter, particularly for hotels in the central, eastern and southern regions.
Hotel operators have recorded a 55.6% occupancy rate so far in October, estimating their guest numbers will increase by 5-10% during the fourth quarter, according to the THA.
Regarding the Chinese market, 35% of hoteliers do not expect more arrivals during the high season, while 27% believe the number will decrease by 10%. Some 38% expect Chinese guests will increase by 10-20%, mostly flocking to four-star hotels.
Hotel operators also do not hold out much hope for Thai guests, as 65% said bookings would remain flat or decrease during the quarter. Among respondents, 19% believe the decline will exceed 10%.
Mr Thienprasit said most hotel operators are concerned about the floods and would like the government to launch relief measures and stimulus schemes to help them recover in time for the upcoming high season.
He said even though flooding issues in many provinces have been solved, tourism activities cannot immediately resume with transport out of order, while many tourism companies and related supply chains have been severely affected by the floods.
"Soft loans and other measures that help reduce utilities costs are essential for tourism recovery in the fourth quarter," said Mr Thienprasit.