Commercial property developer UHG plans to invest 1.5 billion baht to expand its hotel portfolio in fringe areas of Bangkok and convert office space on Lat Phrao Soi 4 into hotel rooms, capitalising on tourism and escaping the oversupplied office market.
Managing director Wutthiphon Taworntawat said the Digital Economy Promotion Agency, the sole office tenant at the Ladprao Hills mixed-use project, is gradually moving out, following the completion of its own headquarters.
"Finding new office tenants to replace a single occupant is tough amid fierce competition and the office market's oversupply," he said. "Turning the space into hotel rooms to expand our existing portfolio is a far more worthwhile investment."
UHG will invest 200 million baht to convert 7,000 square metres of office space across six floors at Ladprao Hills into 200 hotel rooms, with the conversion expected to take around three months to complete.
Based on the average occupancy of The Quarter Ladprao, a 194-room hotel and part of Ladprao Hills, which reached 90% throughout last year at a room rate of 2,500 baht per night, the 200 new rooms are expected to generate 160 million baht in annual revenue.
At present, the 7,000-sq-m office space, with a rental rate of 600 baht per sq m per month, generates roughly 50 million baht in annual revenue.
Mr Wutthiphon said some of the new rooms will be redesigned to be turned into two-bedroom units, located at the end of each floor, where a studio and a one-bedroom unit will be connected.
"Since last year, the number of family travellers -- mainly from China, Middle Eastern countries and Europe -- has been on the rise, so we're adding family-sized rooms to cater to this growing segment," he said.
UHG plans to renovate nine of its 18 hotels to include family-sized rooms at the tail of each floor, including properties under The Quarter brand in Phrom Phong, Ari, Ratchathewi, Sala Daeng and Ruam Ruedee, as well as Alt Nana and Residences on Thonglor.
"Family-sized rooms command higher rates. For instance, a studio or one-bedroom unit might be priced at 2,400 baht per night, but combining them into a family suite can upgrade the rate to 6,000-8,000 baht," Mr Wutthiphon noted.
With European tourists arriving in larger numbers and staying longer -- typically four to seven nights -- and replacing the sluggish Chinese market, UHG will also expand the size and variety of its food and beverage offerings to cater to this segment.
In February 2025, UHG opened The Quarter Saphankhwai with 200 rooms, where the majority of guests came from Europe -- led by Germany, the UK and France, followed by Spain, the Netherlands and Italy.
"European tourists still can't match the spending power of the Chinese, who are typically willing to pay more, even for last-minute bookings," Mr Wutthiphon said. "We hope to see a rebound in Chinese arrivals this June during Pride Month."
He added that UHG is in talks with landlords in areas on the fringes of the city near mass transit stations to lease properties for the development of three new hotels this year, with a total investment of 1.5 billion baht.