Patong beach in Phuket is deserted because of the pandemic. APINYA WIPATAYOTIN
PHUKET: With the pandemic ravaging the tourism industry and slowing the property market on the islands, a local developer is pivoting to a guaranteed yield strategy, aiming to sell to buyers and rent to uncertain workers.
Thanusak Phungdet, president of Phuket-based property developer VIP JD Group Co, said the Phuket market has been stagnant since March 2020 after the province was temporarily closed and tourism activities halted.
“Foreign buyers cannot fly to Phuket,” he said. “Many property projects were delayed or frozen until borders are reopened. If quarantine is not required for vaccinated tourists, the market will definitely resume.”
Mr Thanusak, also president of the Phuket Chamber of Commerce, said the property market grew in tandem with the healthy tourism sector. If tourism does not rebound to the same level as in 2019, the property market will be slow to recover, he said.
The Phuket Tourism Association reported tourist arrivals to the province totalled more than 14.5 million in 2019, up from 14.4 million in 2018. Some 73% were foreign tourists, led by Chinese, Russians, Australians, Germans and British.
Revenue from the tourism sector rose to 472 billion baht in 2019 in Phuket from 449 billion the previous year. However, it plunged 75% to 108 billion baht in 2020, with 91% recorded from January to March before the lockdown.
Association president Bhummikitti Ruktaengam said Phuket’s economy relies heavily on tourism and tried to shift to Thais from in October to December last year, but only recorded 180,000 visitors during the period.
Mr Thanusak said Phuket had 1,945 accommodations, featuring 100,000 rooms, which exceeds Bangkok. Now only 1,000 rooms are open and the average occupancy rate is only 10%.
Since March last year, unemployment in tourism and related sectors totalled 150,000. Daily flights declined to zero from a peak of 370 flights per day, which brought in 80,000 passengers