While Bali’s tourism industry has been battered from the ongoing impact of the global pandemic, the island’s real estate sector has experienced a rapid shift in demand. Indonesia’s barrier to overseas travel has, in an unlikely turn of events, stimulated a new wave of luxury property sales, mostly in the villa segment. A substantial trend in luxury villa sales has been revealed in our research in the secondary market, which has been driven by domestic buyers from Jakarta and Surabaya. Transactions have been mixed mostly between prime properties in Greater Canggu and South Bali at premium prices and the other end of the spectrum stress-driven discounts across a broader area.
BALI’S HOTEL RESIDENCES: SALES PRICE VS. SALES PACE FOR VILLAS AND CONDOMINIUMS
Another key impact of Covid-19 has seen foreign buyers already in Indonesia adopting a work-from-home lifestyle and purchasing homes. This is especially prevalent in Canggu and the rapidly expanding West Bali coastline. We expect this to continue to trend, with a younger, digitally-enabled demographic profile emerging. Increasing interest from international buyers from Singapore, Hong Kong, and other city-based buyers from Europe and North America looking at resort locations across Asia to live and work from home is a new constant in our Asia-wide market research. Despite the vibrancy in overseas investment into Bali, there remain no new significant changes in Indonesia’s foreign ownership laws nor pandemic-driven incentives to date.
Meanwhile, land sales and property prices have remained extremely active, especially for residential project development and individual luxury-oriented villas. Domestic buyers are the key players in this sector, with competition high for prime sites and maturing locations.
One market that has seen sharp declines is hotel-branded or branded residences developments. Given stress in the tourism market and saturation of condominium hotels, we expect this class of real estate to remain sidelined for the remainder of 2021. Given many of these projects are focused on foreign buyers who are presently unable to visit Bali, there is little reason to expect a rebound in transactions until the broad international tourism market returns.
Looking at resort-grade real estate projects for sale in Bali, our research shows that condominiums still exceed a 60% share, though the villa segment is poised to grow. Primary sales volume over the past year totaled USD 272 million, which is approximately a third of pre-COVID transaction levels.
#BaliBrandedResidences #BaliHotelandTourismMarket #BaliLuxuryCondominiums #BaliResidences #BaliCondominiumVillaMarket #BaliPropertyMarket #BaliMarketReport2025 #BaliBrandedResidencesTrends #BaliLuxuryDevelopments #C9Hotelworks #C9Insider
Khao Lak’s tourism industry has historically been laser focused on leisure destination demand from international travelers. The market has a seasonal legacy in the wholesale segment, driven primarily by European visitors. Nevertheless, in recent years Asian visitation has picked up noticeably but with a significant absence of Thai travelers.
PHANG NGA HOTEL OCCUPANCY
International chain hotels over the past decade in Southeast Asia have increasingly become standardized properties, with most tailored to fit into specific hotel brands. Soft brand offerings have proliferated given international hotel chains driving ambition to expand revenue. Southeast Asia’s tourism and hospitality explosive growth trajectory has motivated hotel owners who want to retain their identity under a soft brand scheme, yet benefit from hotel brands’ customer base and distribution channels.
INDEPENDENT HOTELS VS BRANDED HOTELS IN SOUTHEAST ASIA
With a total of 8,757 operating international standard hotels in Southeast Asia according to STR data, over 80% of these are independent. With less than 20% being affiliated to international hotel brands, this reflects a significant opportunity for conversions. Key regional markets are Thailand, Indonesia, Vietnam, Malaysia and Philippines.
Hotel conversions across Southeast Asia are largely concentrated in the upscale (31%) and upper midscale (22%) tiers. According to our market research, pipeline soft brand offerings are mainly in the upper upscale (54%) and upscale (24%) tiers.
The post-COVID challenges are anticipated to spur more owners of independent hotels to seek shelter under global chains in the mounting storm of uncertainty. Hotel lenders are also expected to exert increased pressure on hotel owners to mitigate default risk.
#SoutheastAsiaHotels #HotelConversionTrends #SoftBrandHotels #IndependentHotelsAsia #HotelBrandAffiliation #AsiaHotelMarket2025 #HospitalityInvestmentAsia #C9Hotelworks #C9Insider
Hua Hin has continued its journey down a sustainable path of visitor arrivals with a 5-year CAGR of 6%. Post Covid-19 we expect Hua Hin to recover faster than other tourist destinations in Thailand, due to a locational advantage and close driving distance to Bangkok.
HUA HIN VISITORS ARRIVALS
With the domestic sector being the dominant source market for Hua Hin’s tourism sector, accounting for 74% of the demand, the market-wide average room rate has held over the past few years and surpassed the THB4,000 level in FY2019. It is notable that other key resorts markets in Thailand have seen rates retreat, as rates have been marginalized by an appreciating baht and new supply.
Two key infrastructure projects that will attract broader Hua Hin’s tourism growth are the development of a high-speed rail system, and a double-track railway (60% completed). Moreover, a budget of THB350 million has been approved for Hua Hin Airport’s runway expansion and a new passenger terminal.
With the launch of international direct flights from Kuala Lumpur by AirAsia in May 2018, Hua Hin’s Airport expansion project will enable larger aircraft. Hence, we expect to see low-cost airline carriers implement direct routes from regional markets such as Mainland China, India, and ASEAN countries once completed.
#HuaHinHotelMarket #HuaHinTourismUpdate #ThailandHotelTrends #HuaHinTravelRecovery #HuaHinDomesticTourism #HuaHinInternationalFlights #C9Hotelworks #C9Insider
Koh Chang’s hotel market maintained balanced year-round demand, driven by the contrasting travel patterns of domestic and international visitors, resulting in island-wide tourism receipts totaling THB 13.9 billion.
VISITOR ARRIVALS IN TRAT VS. KOH CHANG
Koh Chang is an island hideaway in the Gulf of Thailand, within drivable proximity to Bangkok. The destination is highly leveraged with domestic tourists, mainly from Bangkok and nearby provinces. Thai visitors usually travel during the low season from April to September. During the peak period from December to February, most hotels run over 90% occupancy, with high demand coming from long-haul European visitors, with up to a two-week average length of stay.
In 2019, Koh Chang welcomed 1.3-million visitors in total. The Thai Baht appreciation last year affected hotel guests’ behavior and purchasing power, hence many hotels had to adjust room rates, resulting in a decline in RevPAR of 3%.
The COVID–19 crisis in Q1 2020 has negatively affected hotel occupancy in terms of early check-outs, cancellations, and a flat trend in new bookings. As of February 2020, it is estimated that the number of visitors to Koh Chang dropped by 18% year-to-date.
Looking forward post COVID-19, domestic demand is expected to see early recovery. Due to increasing hotel supply in the upscale and upper-upscale market segments in recent years, competition amongst four-star hotels is anticipated to mute average room rate growth in the short term.
#KohChangHotelMarket #ThailandHospitalityIndustry #KohChangTourism2020 #ThailandIslandTourism #ThailandDomesticTravel #KohChangTravelTrends #C9Hotelworks #C9Insider
Bali’s real estate market remains one of Southeast Asia’s unlocked mysteries. Since the disruption by both internal and external factors such as the country’s disruptive tax amnesty program that ran from 2016 to through 2017, and succeeding volcanic eruptions, Bali’s property sector has yet to find a new normal.
BALI’S BRANDED RESIDENCES REVIEW
Looking at what sector should be the poster child for the industry, branded hotel residences in Bali, the first indications of a market flux are clear. According to C9 Hotelworks market research, there are over 1,600 units in seven projects that are either on hold or have been canceled. This includes brands such as Mandarin Oriental, Jumeirah, ACCOR, and Amari. In a failure to launch syndrome, financial issues are cited as the leading cause to pause.
If you turn back the clock a decade, the branded residences segment was at the top of its game headlined by properties affiliated to Aman, Alila, W, Bvlgari, Banyan Tree, Anantara, and others. At that same juncture, a large critical mass of midscale condo-hotels sprang into the market, capturing domestic investors’ real estate appetite lured by promises of guaranteed yields and holiday usage. Roll into 2020, and this sector has somewhat cooled, and domestic ‘off-plan’ speculative buyers have shifted focus into other products and geographic areas.
One of the fundamental characteristics of Bali’s residential property market that is different from say Phuket, which is Asia’s biggest resort real estate critical mass, is the lack of foreign ownership vehicles. Where in Thailand overseas buyers can buy freehold condominium properties, though there are project thresholds, this is not the case in Indonesia. Hence, the regime is leasehold, and terms can vary depending on structure and interpretation by government agencies.
Legacy real estate for foreigners in Bali that started in the 1980’s and 90’s used either shorter-term leased for land and villas were built or else nominee structures. The tax amnesty by and large put the nail in the coffin of the latter age-old structure on a wide-spread basis. So today, projects often require two types of structures and, in some cases, even segregated products for domestic and international buyers.
Let’s fast forward into 2020 and look at compelling trends in Bali’s property scene:
- Freehold property in Bali is largely preferred by Indonesian buyers who represent over 50% of transactions. They are typically from Jakarta, Surabaya, and Makassar.
- Speaking about China as you roll back a few years, and it was anticipated to lead the pack with volume buyers. As the China-US trade economic issues rose, the expected volume has not materialized nor have large Chinese developers introduced yield focused entry-level condo hotels as they have across Thailand.
- In pure leasehold projects, these are aimed at overseas buyers who come from Australia, North America, and Europe. Three key international emerging markets are Russia, Japan, and South Korea.
- Locational demand in Bali is on the move, Canggu and Berawa becoming expat haven’s surrounded by international schools, beach clubs, co-working spaces, and drawing digital nomads.
- While Seminyak, Uluwatu, and Jimbaran all remain attractive depending on buyers’ lifestyle preferences.
While this is all a lot to take in, there remains potential in Bali’s real estate ambitions, but the new trends include smaller entry-level pool villas that are priced in line with shorter lease terms. Next are co-living developments which are lifestyle centric and work on rental, not ownership models. Lastly, we see more upward trajectory in lower but sustainable rental yield properties that work on more traditional real estate fundamentals.
As for the next step forward, the elusive game-changer remains Indonesia’s long-delayed reforms on foreign ownership or at least some movement in the condominium sector. Otherwise, the shift to rental yielding properties looks to be tapped by both domestic and foreign developers.
#BaliRealEstate #BaliInvestmentTrends #BaliLeaseholdProperty #BaliVillaMarket #BaliLuxuryProperty #BaliRentalYield #BaliHospitalityRealEstate #IndonesiaRealEstateMarket #BaliBrandedResidences #BaliPropertyMarket2025 #BaliHotelResidences #C9Hotelworks #C9Insider
Phang Nga & Khao Lak’s rising hotel supply, coupled with stable tourism growth, reflects the destination entering a new cycle—further accelerated by the upcoming airport, which is expected to drive greater market diversification.
PHANG NGA HOTEL GUEST ARRIVALS
Khao Lak, located in Thailand’s Phang Nga province, differentiates itself from Phuket’s mass tourism as it is dominated by Western travelers. As of year-to-date November 2019, the province recorded a total of 970,692 guest arrivals at accommodation establishments with most of the hotels concentrated in Khao Lak. Tourism demand remained stable last year with a slight 0.7% growth y-o-y as of YTD Nov 2019.
The existing hotel supply in Khao Lak has 154 properties, representing 10,606 keys. Half of the developments are focused on the beach areas located at the center of Khao Lak, namely Bang Niang (20%), Nang Thong (23%) and Khuk Kak (7%). The hotel market continues to be dominated by the wholesale segment with long-haul travelers. Thomas Cook was traditionally one of the largest wholesalers in the market before the company ceased trading in Q3 last year. The impact is expected to be short-term with new bookings redirected through other wholesalers or distribution channels.
Aside from stronger destination awareness contributed by existing and upcoming international branded hotels, the Andaman International Airport which is under development north of Phuket is expected to drive a new market cycle for Khao Lak.
#PhangNgaTourism #KhaoLakHotelMarket #PhangNgaHotelUpdate #KhaoLakTravelTrends #ThailandBeachDestinations #PhangNgaAirportDevelopment #AndamanCoastTourism #ThailandTourismInsights #KhaoLakResortMarket #ThailandHotelInvestment #C9Hotelworks #C9Insider
Bintan’s limited accessibility remains a key barrier to unlocking the island’s full tourism potential, with hoteliers placing high hopes on the upcoming international airport to drive future demand.
BINTAN HOTEL SUPPLY 2020
Bintan is located in the northwest of Indonesia within close proximity to Singapore. Currently, there are six seaports and one airport (Raja Haji Fisabilillah airport) on the island. Ferries are the primary transportation mode as the airport only serves domestic flights. Bandar Bentan Telani Ferry Terminal draws the highest number of arrivals, which totaled 1.06 million in 2018 (latest available data).
Over 42% of the hotel supply on the island is located inside the integrated tourism development of Bintan Resorts. It has the highest concentration of internationally branded resorts ranging from midscale to luxury tier. Singapore is the largest source market for Bintan, accounting for 36% of the total international visitors in 2018. Due to the heavy reliance on a single market, room night demand peaks during weekends and Singapore public holidays. However, occupancy drops significantly on weekdays and effectively caps trading numbers.
There is a much delayed new airport located inside Bintan Resorts, that when finally operational, will alter the island’s tourism ambition. Targeting international flights, the project features a 3,000-meter long runway with capacity of one million passengers annually. The airport could be a positive disruptor, the increased connectivity will draw demand from a wider market.
#BintanTourism #BintanHotelMarket #BintanTourismDevelopment #BintanResorts #BintanInternationalAirport #IndonesiaHotelMarket #BintanTravelTrends #BintanHotelUpdate2025 #BintanLuxuryResorts #C9Hotelworks #C9Insider
The increase in passenger arrivals in the second half of 2019 was driven by a 298% year-on-year surge in Indian visitors following the launch of direct flights to Bengaluru, Delhi, and Mumbai, have helped rebalance Phuket’s tourism market.
PASSENGER ARRIVALS AT PHUKET AIRPORT
In 2019, Phuket’s year-on-year passenger arrivals declined in Q1 (-4%) and Q2 (-7%) due to international economic volatility, China-US trade tensions, and a strong Thai baht. Long-haul travelers from Australia and European countries (led by Scandinavia, Germany, and Italy) shrank. Moreover, Chinese arrivals moved into troubled territory with a negative year-on-year growth rate of -9%.
However, passenger arrivals notably regained momentum in Q3 (3%) and Q4 (8%). The demand came from regional Asian feeders (led by India, Malaysia, and Singapore). Overall for the year, passenger arrivals in 2019 are forecasted to be similar to 2018, but punctuated by a H2 rising trend.
Looking at key hotel performance trends in Phuket, the second half growth spurt in demand drove full-year market-wide occupancy to 72%. Rate pressure remains intense and a challenge to RevPAR; with Thai currency appreciation set to continue in 2020.
A key airlift factor is direct flights and diverse destinations. Comparing Mainland China with 21 destinations from 22 airlines and Russia with 34 destinations from 8 airlines, the number of Indian arrivals from 3 cities and 2 airlines is anticipated to see continued market penetration and upside.
#PhuketTourism2020 #PhuketHotelMarket #PhuketVisitorArrivals #PhuketIndiaTourism #PhuketTravelTrends #PhuketTourismRecovery #PhuketMarketUpdate #PhuketDevelopment #PhuketRealEstateInsights #C9Hotelworks #C9Insider
