BANGKOK, 15 December 2021: Investment volume in Thailand’s
hospitality sector in 2021 should grow more than five times the volume
witnessed in 2020, reaching THB 12 billion by year-end, JLL predicts.
Year to date, 13 properties have been sold, totalling THB5
billion of combined value, compared to four properties worth THB1.9 billion in
total sold last year.
JLL’s data tracks sale transactions of hospitality assets
that are operated to international standards. These include investment-grade
hotels, resorts, and serviced apartments in Bangkok and Thailand’s key leisure
JLL Hotels & Hospitality Group executive vice president,
investment sales, Asia Chakkrit Chakrabandhu Na Ayudhya says: “Hotel
investment activity in Thailand has recovered to the pre-Covid-19 level. We
anticipate the investment volume this year to reach THB12 billion if ongoing
deals with THB7 billion of combined value are completed by year-end as
expected. This means the total investment volume for 2021 could surpass the
10-year average of THB10 billion per annum witnessed between 2009 and
“At JLL, we have recently closed the sale of 138-key
Citadines Sukhumvit 23 Bangkok and are working on more than 10 hotel deals with
a combined value of over THB 17 billion. Of these, two are likely to be
concluded by the end of this year,” he continues.
Buoyant hotel investment activity this year has been driven
by the availability of investment-grade assets for sale, strong demand from
investors, and the narrowing gap between buyers and sellers’ price
expectations, according to JLL.
Based on observations by JLL, luxury and iconic hotel assets
offer little or no discount due to their irreplaceable nature and owners’
profiles. In addition, owners of these hotels are generally less affected by
the pandemic compared to others.
JLL’s observations also show that prices of investment-grade
assets in Bangkok have relatively remained firm, compared to resort markets,
and bigger discounts are witnessed in second-tier markets, especially in
Considering transactions completed so far this year, 90% of
the buyers are local wealthy families, well-capitalised corporates and international
private equity funds establishing or expanding their hotel portfolio. By
transaction value, foreign investors this year are expected to account for 62%
of the hotel buyers in Thailand when taking into account the remaining hotel
deals that are likely to be closed by year-end.
While JLL expects to see continued interest from foreign
investors in the coming years, the firm also believes that the ease of
restrictions on cross-border travelling will encourage more participation from
foreign investors in 2022, leading to higher competition for quality assets.