AFFLUENT TRAVELERS DRIVE KOH SAMUI RESORT OCCUPANCIES AND RATES UP - REVEALS INDUSTRY REPORT

While Thailand's frenzied hotel development pipeline continues to be driven on steroids, Koh Samui has been quietly going about it's business with high-end property openings that are driving occupancies and rates higher and establishing the destination resort island as a bright spot on the horizon. Upscale hotel demand drove market-wide average room rates up 16% and spiked occupancy 6% last year according to C9 Hotelworks' 2011 Hotel Market Update released today (download here) and the series of high profile internationally branded hotels which have rolled out on the island are now having a profound impact on traditional trading patterns. According to C9's Managing Director Bill Barnett "new direct overseas flights from key regional hubs in Singapore , Malaysia and China are aiding rather than abetting the cause, with total international passenger arrivals from 2007 - 2011 increased at a compound annual growth rate (CAGR) of 7%". "Growth in luxury and upscale properties is spurring the cyclical pattern of volume and average rates forward. Be it induced demand or a reaction to overcrowding in Asia's key leisure destinations, the storyboard is etching a niche into the market," he said. The report further reflects a changing profile of visitors with China, Korea and Japan accounting for 63% of total Asian hotel guests. Germany remained the top overall source with 14%, from a list that includes the UK with 8% followed closely by Australia just one percentage point down on that. Analyzing the tourism demographics Barnett said the five-year trend comparison magnified the island's reliance on international travelers. Occupancy and RevPAR metrics in the budget and economy sector which is favored by the domestic sector show downward performance. "Looking inside the numbers, the lack of a low-cost airline service to Koh Samui has restrained local demand, unlike other Thailand destinations such as Phuket. This can be seen as a hindrance in terms of volume but in terms of attracting travelers with high disposable income and limiting the impact of the island's strained infrastructure it is a positive development." C9's market research states that at the end of last year there were 448 hotels with 17,204 rooms in Samui. Viewing the development pipeline for the next few years there will only be a 3% rise in supply with 513 new rooms coming into inventory. Paramount to the overall analysis of supply and demand is that fact that Samui has escaped the lollapalooza of domesticated hospitality investment running rampant in other parts of the country, and its incoming pipeline is flattening. While C9's Barnett points out "there remains danger signs for an aging supply of midscale hotels and the budget sector which are sensitive to a numbers game." About C9 Hotelworks C9 Hotelworks is a hospitality consulting firm based in Phuket, Thailand and led by Managing Director Bill Barnett. With 27 years of experience in Asia Pacific, he is a leading specialist on hotel and property development issues, having held executive positions with a number of international hotel chains. He is a columnist with a number of leading newspapers, including the Phuket Gazette and The Nation and has appeared on CNBC, the BBC and CNN. His popular website www.thephuketinsider.com is the authoritative source of all Phuket hotel tourism and real estate issues and trends. More information on the company can be found at www.c9hotelworks.com For further information or high-resolution photography please contact : Bill Barnett, Managing Director, C9 Hotelworks Email: [email protected] Telephone: +66 (0)8 1956 1802 -KP-

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