May 19, 2009--KOH SAMUI -- Destination Beach Resort & Spa Co is optimistic its 450-million-baht boutique hotel on Koh Samui will break even over the next six years, despite the global recession, political uncertainty and the outbreak of H1N1 flu.

Koh Samui remains a major tourist destination that is popular with foreign travellers, especially Europeans, said Piraipan Chawalrut, the company's managing director and the hotel's owner.

The island economy is still growing on an annual basis, driven by foreign tourist arrivals and a number of new hotels and resorts opening to serve the increased demand, she said.

At least five or six hotels and resorts will be officially opened this year, with each having invested more than 1 billion baht in construction. Major brands include Banyan Tree, D2 of the Dusit Thani chain, and W Hotels, a luxury division of Starwood Hotels & Resorts Worldwide.

"The hotel and resort outlook is still positive on Koh Samui, but the housing property is posting a decline," said Mrs Piraipan.

Some 40 daily flights from Hong Kong, Singapore, Kuala Lumpur, Penang, Chiang Mai, Phuket, Krabi, U-Tapao and Bangkok serve the island.

Destination Beach Resort & Spa has scheduled an officially opening within the next two months.

The property has 66 rooms, including 10 villas. Room rates range from 7,000 to 25,000 baht per night.

The company expects its customer base to be about 90 percent international tourists, mostly coming from the West and from affluent Asian nations, such as South Korea and Hong Kong.

"In the past, Samui hotels could break even in only four years. But new hotels will take longer as construction and operating costs are growing higher every year," she said.

Current construction costs on Koh Samui are about 30 percent higher than those onshore. Basic infrastructure costs, such as piping water, are also high. The island faces water shortages, especially during high season, when properties buy water from a private company with a desalination plant.

Mrs Piraipan expects an annual average occupancy rate of at least 60 percent. The company will sell its rooms mainly through overseas travel agents to minimise risk.

-----

To see more of the Bangkok Post, or to subscribe to the newspaper, go to http://www.bangkokpost.com.

Copyright (c) 2009, Bangkok Post, Thailand

Distributed by McClatchy-Tribune Information Services. For reprints, email [email protected], call 800-374-7985 or 847-635-6550, send a fax to 847-635-6968, or write to The Permissions Group Inc., 1247 Milwaukee Ave., Suite 303, Glenview, IL 60025, USA.