Thailand: Where does recovery stand?

Thailand, like many nations, has lifted COVID-19-related entry restrictions for travelers and provided an additional flow of demand for reopening hotels. But while hotel occupancy improves in the market, levels remain well below pre-pandemic levels with full recovery not expected for years.

Thailand vs. Phuket: Similar trend lines

To measure the impact of COVID-19 and government measures in the country, it is important to first look back. In 2019, Phuket recorded its highest occupancy level in February (88%). Then early this year, the market posted an 84% occupancy level in January 2020. As the pandemic spread, however, Phuket saw a deep drop in occupancy to as low as 1% in April 2020.

The trend was similar for all of Thailand, with its highest 2019 occupancy in February (88%), a January 2020 level of 78% and a COVID-19 low of 8% in April 2020.

“Normal” weekly patterns

As we’ve seen in other markets around the globe, Thailand has showed a slow recovery pace that follows normal weekly patterns, with Saturday producing the highest occupancy level of the week. The market saw its occupancy peak at the end of July (51%).

While looking at August daily data, Hua Hin posted a 71% occupancy level on 8 August and 29 August, both Saturdays—the market’s highest occupancy days in August. Saturday producing the highest occupancy level of the week is a pattern that could also been seen in other markets such as Phuket and Pattaya, as well as Thailand as a whole.

How far are we from last year?

Through the first seven months of the year, Thailand reported a 75% occupancy decrease from the same period in 2019. In April 2020, the country saw its worst occupancy decrease (-89%).

For comparison, Phuket posted a 90% decrease in occupancy for the July year-to-date period. As we saw in Thailand as a whole, Phuket saw its worst occupancy decrease during April (-99%). However, the market saw a slightly occupancy increase during June and July.

Has future development been affected by COVID-19?

Phuket still shows a considerable amount of pipeline projects. At the time of writing, seven projects and a total of 1,858 rooms were in the active pipeline due in 2020. Nine projects and 1,932 rooms were in the active pipeline set to come online in 2021. However, with uncertainty remaining around the pandemic, and many of those projects still in the planning phase, we could see a decrease in that number. Historically, the market has seen a 3-4% supply growth since 2012.

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