Bali Hotels Edge Ahead of Phuket

In the battle for regional destination supremacy Bali has now edged ahead of Phuket as a result of the continued political issues and uncertainty facing Thailand. thephuketinsider.com attended the Hotel Investment Conference (HICAP) Asia Pacific Update last week in Singapore and spoke to Horwath Managing Director Robert Hecker who is a leading authority on hotels and tourism.

Looking at the numbers for Bali in the first quarter of 2009 average occupancy came in at 65%, and average room rates of US$115; while the outlook for full year 2009 is 65-70% occupancy and rates of US$115-120. It's important to note that Bali's high season which is highly leveraged from the Australian market comes later in the year, hence room rates will increase.

While for Phuket which the first quarter is traditionally high season only achieved 65% with rates of US$143. Moving to a full year forecast which factors in low season occupancy is anticipated to be 55-60% and a significant rate decline down to US$110-115.

It seems to be the consensus of the international hotel operators, financial institutions and consultants who attended the conference that this year would see no recovery and in 2010 a best base case was markets would hold. Horwath's forward outlook on Bali next year was occupancy of 65-70% and rates in the band of US$120-125. While for Phuket occupancies are expected to be in par, coupled by a continued rate decline down to US$105-110.

Presently Bali has instituted a moratorium on new hotels which excludes those under construction or with planning permission; though a strong negative will see in excess of 1500 mid tier hotel rooms enter the stream in 2009-2010, and 300 upper tier units. Much of Bali's recent success has been as a result of growth in regional demand and a redirection of travelers from Thailand. Additionally the limitation of resorts in Vietnam is creating demand. Long haul US and European business is declining in that market with the exception of Russia.

For Phuket the biggest hits have been from last years airport closures and this years continued demonstrations which garnered worldwide attention. Given that Bali will have a swing in the next 24 months to a more unfavorable supply and demand ratio with new products hitting the market; while much of the new supply anticipated for Phuket has either slowed down or stopped as a result of the negative debt and equity markets.

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yeah, just as i thought, i respond to this guy Mat and you never print my comments. What a waste of space this site is

Bill Barnett responds:
If the comments don't violate the guidelines they go in positive, negative or otherwise if they fall under offensive they get deleted, so keep the relvant ones coming.

Aussie Jocky, 28 May 2009 | 3:00 pm

Matt, there have been 5 Australians sentenced to life in Thai jails for drug running, please check the link below
http://en.wikipedia.org/wiki/List_of_Australians_in_international_prisons#Thailand

Aussie Jocky, 28 May 2009 | 8:25 am

it's shocking how quickly people forget about what had happened in bali. well, by the same token, phuket's dip in popularity will just pass over as quickly.

Peter From Hong Kong, 27 May 2009 | 1:38 pm

Well maybe, but on the other hand, no Aussies have been sentenced to death or life in jail for smuggling drugs here either... Just goes to show, big stories are quickly forgotten.

Matt, 26 May 2009 | 11:00 pm

I spent almost 3 months in Indonesia with my wife last year, visiting Bali, Sulawesi, Java, Kalimantan and Sumatra. Most visitors flock to Denpasar, Kuta beach area in Bali. This island is at least 10 times bigger than Phuket. After 3 days in Westin Hotel, Denpasar, we took a car to the North Shore in Bali where the beach is black due to volcano ash. But the marine life is just paradise and you see so many dolphins at one time. The distance is only 170 KM but it took us almost 5 hours each way, stopping for lunch, and returning to Westin, Denpasar almost mid night. They have only 2 lanes road, well paved, but you got stuck when a slow heavy truck was in front of you.
Throughout Indonesia, they have spectacular natural scenery. They have Alps height mountains, volcanoes, lakes and the beauty is just beyond description. The size of Phuket is not considered as an island in Indonesia.
Unfortunately, Indonesia peoples are cool to caucasians, perhaps due to Dutch colonization. But I think they are devout muslims and they disapprove open erotic acts. Only in Bali whose citizens are Hindu, like Thai Buddhist, the westerners can do things their way because both Hindu and Buddhist are very lenient. But there again, the muslims from Java would come and bomb Denpasar.
Did any of you notice visiting families with children to Phuket have almost disappeared. Now you only see single and young travelers and the content of their language in the locker rooms of golf courses terrifying. Phuket must stop all the nature destroying developments. We still can build a lot by preserving the nature. But most of all, don't make Phuket a sin city.

Sint, 26 May 2009 | 12:01 pm

well i am not suprised, do u know how much press coverage the aussie bar mat mum got over here ? for over a week, the papers, radio and TV were over dosing us all with how corrupt thailand is, and then there was the story in the Sydney Morning Herald about the couple who had to pay the police $3,000 for them to drop a minor case.. little wonder us Aussie's are avioding Phuket

Aussie Jocky, 25 May 2009 | 5:37 pm