Early signs of Phuket revival appear


Pullman Phuket Arcadia Naithon Beach. Several hotel chains in Phuket posted higher bookings once the sandbox scheme was confirmed.
Pullman Phuket Arcadia Naithon Beach. Several hotel chains in Phuket posted higher bookings once the sandbox scheme was confirmed.

Thailand is working to reopen to foreign tourists following a commitment from the prime minister to lift most restrictions by mid-October, with the aim of putting the economy back on track.

Hospitality businesses are pinning their hopes on the Phuket sandbox model starting on July 1 to accelerate the tourism recovery and save the industry from another lost year, despite the risks and uncertainty regarding the pandemic.

“Now is the ideal time to reopen the country to the world, following other destinations in Europe, the Middle East and the US that have already opened to safe countries and vaccinated travellers,” said William Heinecke, founder and chairman of Minor International.

A clear tourism outlook remains difficult to predict because of numerous entry requirements for fully inoculated tourists.

Garth Simmons, chief executive at Accor for Southeast Asia, Japan and South Korea, said there was an increasing trend of inbound searches for Phuket and bookings from countries with high vaccination rates after the Tourism Authority of Thailand confirmed Phuket would reopen in July.

RECOVERY BEGINS

Mr Simmons said the company recorded a 92% uptick in bookings since the confirmation of the Phuket sandbox, particularly in upscale and luxury properties.

Accor has 21 hotels and resorts across the island, of which more than half have already reopened.

He said non-Thai guests accounted for only 14% of rooms booked in Phuket in April, but a number of forward bookings are coming from foreigners, including Germany, the UK and Israel.

Six properties of Minor Hotels across the island are already seeing longer lead times, though overall bookings still tend to be last minute at this point, said Mr Heinecke.

He said the booking patterns reflect travel restrictions that remain in place.

The company expects solid growth from key regions, including the Middle East and Europe, following the easing of restrictions in October.

Two Phuket properties of Onyx Hospitality Group, a subsidiary of Italthai, have continued their services since the first wave last year and are recording demand from July to September from markets such as Israel, the UK, Germany, France, Spain, Belgium, Switzerland and the US, said Yuthachai Charanachitta, group chief executive at Italthai Group.

Moreover, recent data from Airbnb, an online accommodation-sharing platform, showed searches for lodging in Phuket grew by 80% in June compared with January.

From May 16 to June 16, Airbnb saw a significant increase in searches for Phuket in markets such as the United Arab Emirates, which shot up by 3.8 times, followed by more than 2 times in the Netherlands and over 1.5 times in Japan.

Tourists from the US, France, the UK, Germany and Russia are among the top source markets to book accommodations in Phuket with Airbnb.

International travellers are opting for a long-term stay of 28 days or longer, mainly attributed to a change in work and travel lifestyle amid the pandemic.

In terms of the domestic market, Phuket, Krabi, Koh Samui, Hua Hin and Pattaya are the most-booked destinations.

According to a market report from Horwath HTL, a hotel and tourism consulting firm, Phuket hotels are forecasting a gradual U-shaped recovery, with a turnaround expected in 2023.

However, hotel occupancy rates will not return to peaks of 75.5% recorded in 2018 by 2025 because of intense competition in the mid-market segment and the slow ramp-up of new luxury resorts, said the consultancy.

ONGOING CAUTION

As operators are devoting time, money, manpower and resources to make the reopening plan successful, a lack of information, conflicting instructions or confusion could lead to greater losses or affect the financial situation caused by the pandemic, Mr Yuthachai said.

He said clear and timely communication among all stakeholders is vital for the reopening to gain confidence from travellers.

Mr Simmons agreed, adding the country needs a clear communication strategy from the government to make travellers and businesses more confident.

The most urgent need is to accelerate the vaccination rate in Thailand to keep locals safe and increase the confidence of eager foreign visitors, he said.

The government should consider a long-term tourism recovery plan in close collaboration with the private sector and local communities to strengthen the industry’s recovery, said Mr Simmons.



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