April 03, 2012--With luxury hotels in Bangkok oversupplied and room rates falling, more owners have shifted their focus to mid-range offerings that better match the emerging tourism trend from fast-growing markets such as India and China.

The upscale room glut shows no sign of easing while demand from clients for no-frills accommodation is on the rise, says a new report by the property services company Colliers International.

Among the hotel operators cashing in on the bright outlook for budget and mid-market accommodation are Onyx Hospitality Group, which has kept its focus on mid-range hotels given their strong business potential.

The group offers brands such as Amari Colours & Rhythms and Ozo, with plans to have at least 14 new properties under these brands in the portfolio by 2015, bringing its mid-range hotel total to 45.

More than half of its hotels are managed by the big international chains, with Accor in mid-range and economy-scale hotels.

Accor in Thailand manages 34 hotels with 7,801 rooms under the brands Grand Mercure (2), Novotel (10), Mercure (8), Ibis (8) and All Seasons Thailand (6).

Accor has extensive expansion plans for Thailand. Two Novotels with 473 rooms and three Ibis hotels with 590 rooms will open next year and four Mercure hotels with 1,025 rooms by 2014.

Another All Seasons with 153 rooms will open this year.

All will serve the expected influx of travellers from developing countries.

Thailand is still one of the best leisure destinations for many people, said Glenn De Souza, a vice-president of international operations for Asia and the Middle East of Best Western International, another well-established mid-market chain.

He believes development will continue to focus on major destinations for 2012-13, notably Pattaya, Chiang Mai, Koh Chang and Koh Samui where nature and tourism infrastructure coexist well.

The Best Western network consists of 13 hotels with 1,345 rooms, of which nine are mid-range hotels with 749 rooms. It will open five hotels next year and three will be mid-range.

The Tourism Authority of Thailand (TAT) has observes that the significant expansion of local and international hotel management chains shows that the mid-scale and economy rooms are in high demand.

The outlook for arrivals from China and India is particularly good, pushed by the two countries' healthy economies as well as the rapid expansion of low-cost airlines in the region.

OAG Aviation, the global aviation intelligence group, said budget carriers now account for 26% of global air capacity, up from 11% in 2003.

The highest regional growth in terms of available seats is to and from North America (50%) followed by to and from Central and South America and within Asia Pacific (both 47%). Low-cost travel within Asia Pacific now accounts for 25% of all regional volume.

The TAT forecast that the number of Chinese arrivals would reach 2 million this year, up from 1.7 million last year. The figure from India is expected to grow by 15% to 1 million.

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(c)2012 the Bangkok Post (Bangkok, Thailand)

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