According to the Association of Tour Operators of Russia (ATOR), tourists from Russian Federation fill more than half of the rooms at Le Meridien, Splash Beach and other top hotels. Both rooms and individual villas are popular, reports The Phuket News’ Russian-language sister newspaper Novosti Phuketa.
Tourists from Russia are in the top three even at the Kata Rocks villas, where Pegas Touristik sells “trip packages”. The situation in the private rental market is similar, confirms Tranio executive director Mikhail Bulanov.
Perhaps by next season tourists will be more picky, but now they are ready to pay B100,000-200,000 a month just for a townhouse, not far from the sea, not to mention villas.
Upscale hotels
“Luxury hotels in Phuket are not experiencing any difficulties with occupancy for the Autumn-Winter season 2023/2024. On the contrary, demand in premium hotels exceeds [that of] last year.
“During the New Year holidays, the shortage of rooms is increasing every day. The depth of bookings reaches April,” writes ATOR Bulletin from Phuket, where a representative of the industry publication flew as part of the Pegas Touristik promotional tour and where he spoke with hotel representatives.
The observations of the ATOR representative are valid not only for hotels cooperating with the Pegas tour operator, but also for the entire premium market, including the segment of individually owned resort villas. Absolutely all high-end properties are in demand, be they hotels, apartments or detached houses.
Pegas Touristik itself is now actively promoting its PEGAS Select premium programme, which offers tours with accommodation in five-star hotels ranging from Splash Beach Resort (B90,000 for two for 11 nights in November) to Le Meridien (B170,000 for a similar package).
Pegas Touristik clients are also welcome at Kata Rocks, where the cost of accommodation is from 1 million rubles for 11 nights for two (B390,000), but guests from Russia are already in the top three.
“Yes, many Russians vacation with us. Now the hotel is 70-80% occupied. Half of them are guests from Russia. We estimate the increase in the number of Russians compared to last year at +30%,” ATOR says, quoting a representative at Le Meridien.
“This year the Russian market gives our hotel more than 50% occupancy. Current load is 80%. Both villas and standard accommodation are in demand,” says the manager at Splash Beach Resort.
The demand for Le Meridien and Splash Beach Resort among family clients from Russia is not surprising, as is the demand for other popular places among Russians, including hotels in Karon and Laguna.
In a separate report published on Nov 2, ATOR Bulletin says Mövenpick, Dusit Thani, and Saii are enjoying increasing demand from wealthy Russian travelers. The share of Russian guests at Mövenpick, accroding to the publication, has already exceeded 40%, meaning literally every second guest at this luxury hotel in Laguna is a Russian national.
However, this New Year, almost any venues that are ready to provide a decent level of comfort are in demand. Price is not a strong deterrent.
“The fact that this year we are not giving discounts, as in 2022, and rates have increased by 30%, does not bother tourists, including Russians,” notes Le Meridien.
Private luxury rentals
Mikhail Bulanov, Executive Director at Tranio, confirms that the same trend is observed in the private rental segment. Investors who have invested in real estate during the low season can return up to 10% of the property’s value literally in two New Year’s months ‒ December and January.
“This season in Phuket in terms of growth in the cost of accommodation, be it hotel rooms or villas, will be the highest in the foreseeable future. This is a consequence of the lack of alternatives: Russians have only Dubai, the Maldives and Phuket. There are cases when standard townhouses are rented for December-January for US$6,000 (B215,000). This is simply extraordinary,” says Bulanov.
“In the upper price segment, Russians occupy 50-80% of the total rental stock for this New Year, simply because they are willing to pay that amount to relax with their friends, loved ones, family,” he adds.
The extraordinary nature of this season, however, may become the “new normal” in the coming years if the Russians still have “only Dubai, the Maldives and Phuket” among their available options.
“Perhaps more properties will appear and the profitability will not be the same as now, when the investor receives 10% of the cost of the villa in two months. Perhaps tenants will not be ready, as they are now, to pay that kind of money for any property, but will be more demanding and tuned to a better offer. I mean the villas that are currently being built. They will be filled,” predicts Bulanov.
Last November, Phuket Immigration recorded 63,400 direct arrivals from Russia, and this volume included not only tourists, but Russians who were then moving to Phuket with plans to stay here for at least a few months, but in fact ‒ for an indefinite period.
In October this year, 52,800 arrivals of Russian passport holders were recorded as arriving on the island, that is, almost the same as in the “high season” November. The greater influx of Russians to Phuket is supported by the summer volume of available air transportation and available offers from tour operators.
Since November, the volume of direct flights from Russia to Phuket has doubled. The number of Aeroflot regular flights has doubled, and the number of Azur charters has increased by two and a half times. The carrier ICAR, affiliated with Pegas, has not yet increased the frequency of its flights.