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The Four Seasons Hotel Bangkok Forecasting Revenue Drop of 25% for the
 Year Because of 7-week Shut Down Due to the Political Violence

By Chadamas Chinmaneevong, Bangkok Post, ThailandMcClatchy-Tribune Regional News

May 28, 2010 --The Four Seasons Hotel Bangkok, a five-star hotel at the Ratchaprasong intersection, forecasts that its revenue will drop by 25% this year because of the recent political violence.

The hotel was forced to close for seven weeks from April 5, two days after the red-shirt protesters occupied the area.

The hotel reopened on Wednesday with only 10 of its 354 rooms occupied.

Rainer Stampfer, regional vice-president for Thailand and general manager of the Four Seasons Bangkok, said the closure was the hotel's longest in 28 years.

The property lost more than 100 million baht in revenue. This will affect its revenue projection for the year which is expected to drop by 25% from last year to a point lower than in 2003, when the Sars outbreak decimated tourism.

Mr Stampfer said the hotel business would gradually improve throughout the the year and may fully recover next year.

"I'm confident that tourists want to come to Bangkok, but they don't know whether the situation is now stable or not," he said.

"Thailand will make a return, but I don't know how long it will take."

Corporate travellers will be the first group to return because they need to travel for business, followed by the leisure market, especially from Asia, he said.

The meetings, incentives, conferences and exhibitions (Mice) market will be the last sector to recover as the highly sensitive industry plans its events well in advance. International events account for 90% of the local Mice market.

Mr Stampfer said the revenue contribution from accommodation and food and beverages (F&B) would change from a 50/50 split. This year, F&B will contribute more than half of total revenue.

The hotel recently launched an aggressive promotion, which does not reduce room rates but offers 20,000 baht per person in incentives. The campaign runs until Dec 28.

"We believe in the fair price [of the promotion]," said Mr Stampfer. "People don't travel to Bangkok right now because they feel insecure, not because hotel prices in Bangkok are expensive.

"At present, room rates of four- to five-star hotels in Thailand are cheaper than Singapore by 30% and Hong Kong by 50%. So, we need to make them feel confident and secure to travel here."

Slashing room rates often results in lower quality of service which devalues the product and damages the brand, said Mr Stampfer. "It's not the right way to go," he said.


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