Thailand’s eastern seaboard, largely perceived as a big industrial zone barely a few years ago, is now emerging as a much-touted business, investment and tourist destination, driven by the Thai government’s strong push for the Eastern Economic Corridor (EEC) to connect with China’s One Belt, One Road initiative.
The InterContinental Hotel Group’s (IHG) latest signing in Thailand clearly reflects the bullish sentiments surrounding the eastern provinces. In one fell swoop, IHG yesterday sealed “one momentous signing” with Pattaya-based real estate company Ratanakorn Asset to develop eight hotels spanning more than 2,000 rooms in Thailand, half of which will be located in the eastern seaboard.
The multi-brand signing consists of new-builds and a conversion across the Holiday Inn, Holiday Inn Express and Staybridge Suites brands and is expected to ramp up IHG’s portfolio from the current 24 hotels open and 14 under construction.
The first hotel to open from the newly inked partnership with Ratanakorn Asset will be Holiday Inn Express Pattaya Koh Larn, a direct conversion, which will open later this year on a small island off Pattaya’s coast. The remaining seven will be new-builds, comprising Holiday Inn Resort Koh Larn, Holiday Inn Resort Pattaya Jomtien, Staybridge Suites North Pattaya, Holiday Inn Resort Rayong, Holiday Inn Resort Khao Lak Cape Kakarang, Holiday Inn Express Phuket Kata, Holiday Inn Express Samui Chaweng, which will progressively open from 2022 onwards until 2027.
Speaking to TTG Asia in Bangkok yesterday, Clarence Tan, IHG’s managing director South-East Asia and Korea, expressed his positive outlook: “Thailand tourism performance has been very linear in the last five years, but last year was the tipping point where for the first time revenue growth was faster than the tourism growth, and that portends well for everyone in the tourism sector.
“Thailand is like a tennis ball – it always bounces up very fast after a crisis. We’re now seeing the rise, and with continued stability and development into EEC – the opening of the Utapao airport and the expansion of Suvarnabhumi Airport, etc – this will be a nice ride to be on,” remarked Tan.
Equally enthused is Jugkarut Ruangratanakorn, managing director at Ratanakorn Asset, who believes that the infrastructural projects including the high-speed railway linking Bangkok to Rayong and expansion of the U-Tapao airport in Rayong, plus tax breaks and land concessions given to foreign investors, will draw more investment into this economic zone. “The momentum is there now,” he added.
Pattaya, which Jugkarut admits suffers from “negative image” issues due to its traditional association with sex tourism, is currently evolving and gentrifying with a new crop of hotels, lifestyle amenities and attractions to attract more upscale travellers and families.
Midscale brands make up the bulk of this Ratanakorn Asset signing because Holiday Inn is a “proven brand” and makes a “safe bet” for emerging locations like Na Jomtien (near Pattaya) and Rayong, said Tan.
“The Holiday Inn brand family fits the profiles of the resort and city sites best, capturing all the possibilities of future growth within the EEC,” he added. “We will watch the developments of these micro locations and cities; if the demand and supply matches, we will introduce higher-price brands (into these destinations).”
When asked if there will be any mismatch between travel demand and hotel supply in the EEC, when the region has only been promoted as an international tourist destination in recent years, Tan remarked: “ With G2G development and FDI, these will spur further development in the eastern seaboard… We doubled our size in Pattaya in the last five years, and we will time our supply in the market to meet the demand that is coming in.”
The Asian long-stay markets with business interests in the EEC, as well as domestic and South-east Asian resort travellers, will make up the target markets for IHG’s hotels in Thailand’s eastern seaboard.
Beyond the eastern provinces, Thailand overall is still a growth story, and Jugkarut is also upbeat about development opportunities in other parts of the country. “Korat and Khon Kaen have potential for corporate and MICE,” he said.
Tan concurred: “In South-east Asia, Thailand and Vietnam are happy hunting grounds (for IHG). These two countries are able to play in all segments.”