HUA HIN’S inability to fill hotel rooms during the week and an expanding serviced apartments sector are weakening the destination’s ability to become a more sustainable year-round market, new research shows.
Year-on-year occupancy declined four percentage points to 68 per cent last year, according to C9 Hotelworks’ Hua Hin 2014 Hotel Market Update.
Even though the average daily rate increased to US$160, RevPAR declined 1.4 per cent to US$80, compared to the previous year.
The reliance on the domestic weekend market – accounting for 72 per cent of visitors in 2014 – is one of the market’s key limiting factors which recent improvements in infrastructure and attractions have failed to overcome, said Bill Barnett, managing director of C9 Hotelworks.
“A resoundingly strong domestic segment is continuing to spur upward rate growth, which is a trend most evident at upscale beachfront hotels,” he said. “But the inability to fill rooms during the week poses questions over whether an anticipated shift in long-term maturity is possible.”
Hua Hin currently has 9,157 rooms in registered properties with a further 691 keys in the pipeline between now and 2018, though research predicts the expanding condominium and serviced apartments sector will continue to erode performance at traditional hotels.
Barnett said to TTG Asia e-Daily: “The substantial build-up of resort condominiums in Hua Hua and Cha Am will undoubtedly hit midscale hotels the most, in terms of competition by non-traditional hotel supply.”
Recent developments in Hua Hin include the opening of Vana Nava Water Park, which will be expanded to include a 300-room Holiday Inn hotel and a residential unit, while 2016 will see the launch of BluPort Resort Mall.
These private-sector investments will increase Hua Hin’s allure, but other competing Thai destinations also pose a challenge. Barnett added: “Clearly, in the two-horse race between Hua Hin and Pattaya to capture Bangkok’s leisure market the latter holds a wildcard in terms of direct access.”
