So What's New?
A monthly round-up of the latest Samui information.
Thursday, May 1, 2008
Samui; a world property hotspot
The expert overseas property company, David Stanley Redfern, has recently highlighted Samui as the second best worldwide location for a property investment after the Philippines. It stated that Samui now has more 5- and 6-star resort developments than any other Southeast Asian island, and the competition in the market is good for buyers because it’s forcing developers to find ways to make their developments stand out.
In a separate report the company has again promoted investments on Samui stating that people who bought on the island in recent years have made 100% profit on their investments and resort properties continue to grow by 20% a year.
Samui’s incredible growth is fuelled primarily by impressive tourism figures. As the number of people taking advantage of the island’s white sandy beaches, tropical climate and relaxed atmosphere increases by 20% per year, resort properties on Samui will continue to attract a great proportion of the visitors, and property prices continue to grow accordingly.
Renowned property agency Colliers International supports this opinion and states that foreign investors are expected to invest up to Bt70 billion in the Thai property sector this year, following the lifting of the Bank of Thailand’s 30% capital reserve requirement.
More hotel arrivals
Tanayong, a large residential and commercial property development company, has announced plans to open 12 hotels in Thailand over the next 5 years.
Managing Director, Khun Kavin Kanjanapas, said the company intended to acquire and build a deluxe brand of hotels and resorts including one on Samui.
Tanayong has appointed InVision Hospitality, a hotel consultant firm, to create the brand U Hotels and Resorts. Each will have a maximum 100 rooms and in some cases will include a residential element.
TCC Land has set aside an investment budget of nearly Bt10 billion for new hotels this year. Samui will see the opening of two Imm Brand Hotels.
The Erawan Group has released a plan to double revenues with its biggest expansion drive for 25 years. The three-year Bt9 billion development plan focuses on the hotel business. It will build 12 new hotels including an Accor Ibis budget hotel on Samui and rooms will be added to Renaissance Samui as part of the plan.
After 36 years of operating locally Amari Hotels and Resorts is expanding internationally. However, despite the move abroad, the company is also in the process of developing a new hotel on Samui worth Bt1.6 billion which is scheduled to open in 2010. The Sirimaya will target high-end tourists and be managed by Amari.
Located on Chaweng Beach, it will be the group’s second hotel on the island and a pilot project under the new Sirimaya brand; separating it from the rest of the Amari chain. It will feature 110 rooms and be located on 10 rai of land.
The boutique hotel operator Sri Hotel Group plans to open two new properties worth Bt450 million by 2010. Chief executive officer, Khun Chokchai Kolsrichai, said the Bt300 million Saree Samui Hotel will open in November on a 10-rai plot.
Room rates will start at Bt7,000 per night, with a target occupancy of 60% in the first year of operation. More than 85% of the hotel’s target guests are expected to be foreign visitors.
Langham Hotels International, a Hong Kong hotel brand, plans to expand its hotel management business in Thailand’s five major destinations over the next five years, said vice-president Andrew Jessop.“It’s a good opportunity to enter Thailand as the country is Asia’s premier resort destination.”
The Arayaburi Group has set aside an investment budget of Bt1.5 billion for four new hotels and resorts including another on Samui. Arayaburi Group already owns 10 hotels and resorts nationwide with 700 rooms; 5 of which are here on the island.
Finally, Samui may see the Treasury Department enter the island’s hotel industry. It’s currently considering a Bt1 billion investment to develop a 5-star resort on 30 rai of state property.
The department, a unit of the Finance Ministry, oversees 12.5 million rai of public land nationwide, much of which is under control of various state agencies and the armed forces.
Officials said the development plan would aim to build a 5- or 6-star resort on the island in a joint partnership with a private developer.
Asia’s boutique island to grow
Research by CB Richard Ellis (CBRE) has shown that Samui is experiencing significant growth. Last year, the island welcomed 1.5 million visitors, up from 600,000 in 2000.
These tourist arrivals are expected to rise further with the introduction of the Thai Airways’ flights. In fact, the number of airport arrivals this year is expected to surpass the 2 million mark.
Khun Prakaipeth Meechoosarn, Manager of CB Richard Ellis Samui, stated, “The improved connectivity will be a key factor in supporting growth in the area’s property market.”
CBRE remains confident of the long-term prospects of the Thai resort market. Last year, the company opened on Samui as part of its plan to expand its network in Thailand. Its research said land prices in Samui continued to rise last year even though the number of individual transactions dropped, due to uncertainty surrounding proposed changes to the Foreign Business Act.
The value of property transactions in 2007 was estimated at an average of Bt413 million a month, down from an average of Bt450 million in 2006. But, since last December’s general election, viewings and sales have increased.
CBRE is now witnessing more developments within a price range of $2 - 3 million and believes that Samui is poised to soar on the back of a growing supply of strong, reputable brands. Samui may always be smaller in size than Phuket but it’s forging ahead in the real-estate field.
David Simister, Chairman of CB Richard Ellis Thailand, says the one thing that has held Samui back previously has been a lack of quality branded stock.
This market is now being catered for with residential projects, such as The Residences at Four Seasons Resort. Other branded villas include those at the W Koh Samui Retreat & Spa and the Conrad Koh Samui Resort & Spa.
Mr. Simister pointed out that Casavela, a condominium developed by Aquarius Estates,is almost sold out and hasachievedmore than Bt100,000 a square metre. This is a clear indication that Samui is not too far behind Phuket on pricing.
“A lot of people have indicated that they have projects in the pipeline yet to be launched so I think we are going to see a very different Samui in another year’s time where I think you will see half a dozen internationally recognised brands appear and that, I think, will bring a different level of tourist.”
CBRE estimates that there is approximately Bt12 billion worth of property priced at Bt30 million or above on Samui. “Half of it has already been sold ‘off plan’ and some of the schemes have yet to break ground so we think that is a pretty good sign.”
Star Alliance adds Turkey
Turkish Airlines has become the 20th member of the Star Alliance showing that the alliance continues expanding its already dominant position.
Turkish Airlines brings an additional 31 destinations to the network which raises the alliance’s overall global coverage to 18,000 daily flights serving 965 airports in 162 countries.
Egypt Air and Air India are waiting to become full members in July this year and March 2009, respectively. As Thai Airways is a member of the alliance the potential exposure of Samui now covers an even greater number of people from around the world.
New act to clarify condo law
The Land Department has announced that condominium buyers will soon be protected under an amended Condominium Act which will take effect in July.
Khun Surasith Sahasthamrangsee, the director of the department’s Real Estate Promotion Office, said the new law clarified many issues that had been disputed between developers and unit buyers.
Developers will be accountable for claims made in their advertisements and could face fines for violations. On completion of the project, brochures and marketing materials have to be submitted to the juristic person, the legal body that manages the condominium, to confirm that the product matches what was described.
Khun Surasith said the law also covered areas such as: responsibility for common area fees of unsold units; voting rights for the juristic person; and the inclusion of separate entrances for shops to minimise resident disturbances.
TAT news
The Tourism Authority of Thailand (TAT) is seriously considering the joint promotion of Thai destinations with neighbouring countries in the Indian market. Singapore, Malaysia and Thailand may work together to promote tourism products in India.
TAT’s marketing strategy for the Indian market this year is to encourage Bollywood celebrities to endorse and promote tourism products through advertising and photo-shoots in Thailand. The International Indian Film Academy (IIFA) Awards are being held in Thailand in June, which is seen as a major achievement for TAT.
Thailand is currently second, behind Singapore, as the preferred destination for Indians in South East Asia; and third in the world. A 20% growth is expected this year.
This year’s ASEAN Tourism Forum saw a large group of boutique properties exhibited, confirming that Thailand is witnessing a boom in boutique travel products.
Khun Phornsiri Manoharn, Governor of TAT, stated, “All over Thailand, one of the most important new trends is the significant change taking place in the quality of our tourism products. The emergence of a whole range of chic, boutique properties catering for individualised, niche-markets is a critical component of this.”
These niche-market products complement the major lifestyle changes taking place worldwide. TAT is marketing these properties with a dedicated brochure, CHIC By Thailand. The brochure has been produced in conjunction with tour operators and offers potential visitors a range of special offers for their holiday. For a copy of the brochure, please visit www.tourismthailand.co.uk/chic/Chic.pdf
TAT is expecting Thai hoteliers and tour operators to generate income of up to Bt30 billion after participating in this year’s International Tourismus Borse (ITB), the world’s largest travel event, in Berlin.
A total of 141 exhibitors, including hotel operators, tour operators and other organisations such as hospitals and airlines, joined the international road-shows in Berlin held in March.
The TAT had initially set this year’s inbound revenue target at Bt547 billion, an increase of approximately 10% from the previous year. But this figure has now been revised to Bt800 billion.
Outrigger on Samui
Darren Edmonstone, Vice-President of Acquisition and Development for Outrigger Enterprises,states, “We see Asia as the real growth area for Outrigger. I think a lot of people are looking for a unique leisure and lifestyle solution, which we have the experience and know-how to offer. As a resort development and management specialist with 60 years’ experience in the industry, the Outrigger brand is suited to this region and we are able to offer something different.”
The lifestyle property developer and management company will be managing a resort in Phuket and is also currently involved in a project opening soon on Samui.
A castle on Samui
Castle Resorts & Hotels has acquired hotel contracts for two luxury Thai resorts, including the excellent Baan Taling Ngam Resort & Spa, here on Samui.
With these two new additions, the company now has 26 properties spread throughout Hawaii, Micronesia, New Zealand and Thailand.
Alan Mattson, president and chief operating officer of Castle Resorts & Hotels, said, “Entering Thailand is an exciting new development of our company’s strategic expansion into Southeast Asia. The consummation of these two management agreements in Thailand tops an incredibly successful year of growth for us. We plan to continue this aggressive expansion of our global presence from our Hawaii-based headquarters in 2008.”
Castle Resorts & Hotels was founded in 1994 and manages a broad portfolio of resort accommodations ranging from hotel guest rooms to spacious resort condominium suites and villas in locations such as: the Hawaiian Islands of Oahu, Maui, Molokai, Kauai and Hawaii; on Guam and Saipan in Micronesia; in New Zealand on the North Island; and now in Thailand with the Baan Taling Ngam Resort & Spa on Samui, and the Katamanda in Phuket.
What if you want to book a room on Samui?
Wotif.com Holdings has recently agreed to acquire all of the issued shares in Asia Web Direct Limited (AWD).
Robbie Cooke, Wotif.com’s Managing Director and CEO, stated, “The combination of Wotif.com and Asia Web Direct presents an exciting opportunity to secure a greater share of the Southeast Asian accommodation markets. These markets are likely to see strong growth in coming years as consumers in Asia follow the worldwide trend of booking their accommodation needs online.”In 2007, Wotif.com sold around 180,000 room nights in Asia.
AWD, which was established in Phuket in 1993, was a pioneer for online hotel bookings with instant confirmation in Southeast Asia and it now provides these and other related services through a network of travel portals and destination websites.
The AWD network attracts approximately three million visitors a month, and in 2007 it achieved bookings of about 450,000 room nights. Its room inventory now comes from more than 4,000 hotels in Southeast Asia.
Employing over 150 staff, AWD’s operations are currently conducted from offices here on Samui, in Bangkok, Phuket, Krabi and Kuala Lumpur. Online bookings within Asia are growing rapidly and AWD is well positioned to capitalise on this market in the future.
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