Rathawat Kuvijitrsuwan, Head of Research and Consulting at CBRE Thailand, reported that Phuket alone had more than 10 million international tourists in 2019 who generated around B393 billion for the island, accounting for 89% of its tourism revenue, CBRE noted in a release yesterday (July 6).
In 2020, total number of tourist arrivals to Phuket was about 4mn while in the first half of 2021, Phuket will have less than 400,000 tourists, the release added.
Since January, the number of tourists in Phuket was only 358,891 as of May, almost an 86% change compared to the same period in 2020. With this reason, the Thai government launched the Sandbox initiative to revive the tourism industry, it noted.
“Areas in Patong, Karon, and Kata with predominantly tourism-dependent businesses are currently deserted,” said Prakaipeth Meechoosarn, Head of Resort Land and Investment, CBRE Thailand, who is based in Phuket.
“Hotels, restaurants and community malls are temporarily closed. Also, nightlife in Phuket is limited to until 11 pm, nevertheless, only a few tables were occupied. Retail spaces are empty as many tenants have moved out and the retailers are struggling in finding new tenants. Even in the airport, only branded restaurants have survived,” she added.
The hardest hit is the hotel sector where occupancy and Revenue Per Available Room (RevPAR) are currently as low as figures during the first wave of COVID-19, CBRE noted in its report.
However, Ms Prakaipeth added that the Sandbox initiative has brought some hope to business operators, hotels, restaurants and other hospitality-related businesses in Phuket, and other islands are closely monitoring its development.
CBRE Research reported that more than 300 businesses participated in the SHA Plus Program, where ‘SHA’ certifies that the businesses have public health measures and ‘Plus’ represents that more than 70% of total employees are fully vaccinated.
However, as the island quarantine quarantine period has been extended from seven days to 14 days, local business operators see less potential in the program. They are worried that a longer stay period will lessen tourists’ demand and some hotels will delay their re-opening until August, the report notes.
“Despite recent news reporting that there were almost 8,000 applications for Certificates of Entry (CoE) as required under the Sandbox programme, unfortunately just before the program started many foreign tourists had cancelled their flights and hotel bookings due to the delayed COE and other processes,” the report explained.
Previously, the Tourism Authority of Thailand (TAT) expected more than 100,000 tourists coming to Phuket in the first three months of the sandbox, it added.
“CBRE believes that the balance between safety measures and practicality as well as the effective management of the welcoming process is key for a successful program.
“In addition, it will depend on the overall COVID-19 situation in Thailand as we are still currently in the ‘cautious list’ for some countries. If the situation is improved and under control, more tourists will come.
“Phuket Sandbox could be a good pilot model and lesson-learning opportunity for upcoming destinations as it seems that we all have to live with the COVID-19 pandemic situation for a certain period of time. We all do hope to see a lively Phuket again even with this new normal way of tourism,” the release concluded.