Posts Tagged ‘occupancy levels fall in Koh Samui, over-development’

Falling Occupancy Levels on Samui Island

Wednesday, March 28th, 2012

Occupancy levels for hotels on Samui Island were release today (27th March, 2012). They showed that for the first time in many years occupancy levels have fallen below 40%. This is according to Vorasit Pongkumpunt, the vice-president, of a chain hotels on the holiday island in the Gulf of Thailand. The figure may be in slight dispute, but what is not in dispute is that many hotels and resorts are offering huge discounts often enticing people to stay by offering a free night’s accommodation if they book one night (effectively reducing rates by 50%).

Overall, prices for hotel rooms in Koh Samui have dropped by 15%. Worst effected are small and medium-sized business. Indeed the most expensive hotels have seen an increase in tourist numbers by 16%.

Koh Samui is Thailand’s third biggest island. It was discovered by backpackers in the 1970s and has flourished ever since. It is an island full of white sand beaches, towering palm trees and beautiful natural environment. When an airport was built on the island in 1989. This gave a massive fillip to the tourist industry on the island and many beaches saw the construction of many new resorts. Room numbers have increased quickly through the years. At present there are over 17,000 rooms for rent on Koh Samui, and more are planned. The breaking point has been reached. Tourist numbers visiting the island can no longer keep up with the new construction.

There is a lesson to be learnt from Koh Samui. It is often the case that in developing countries like Thailand regulations are relaxed to help boost the economy. Unfortunately, this slack given is often detrimental to business in the long run. Opening a new resort seems like a way to guarantee a successful business. What many people fail to see is that over development makes a place look ugly. It also removes the exclusive cache of a destination. Regulations are needed to protect nature, preserve the beauty of the location and to make sure that a once beautiful stretch of sand doesn’t turn into one long piece of concrete.

The surplus of rooms has lead to a price war in Koh Samui that hurts all medium and small resorts. It is only a matter of time before the high-end tourists also start looking somewhere else for their holidays.