C9 report shows surge in residential-driven hospitality investments in Phuket

C9 Hotelworks’ latest report shows that Thailand’s tourism boom has led to greater investments into the hospitality real estate sector, particularly for residential developments.

According to the report presented at the most recent C9 Sessions event, many foreign travellers are opting to stay longer in the country, hence increased residential-driven investments into the Thai hospitality and real estate sectors.

Phuket is the province that is benefitting the most from this, as arrivals continue to flock to the destination and the numbers are up by 23 percent as of 2024.

The C9 report shows that the emergent trend is focussed on the rental market, a sector that has seen a significant surge in investments into resort-inspired condominium developments in prime locations.

C9 Hotelworks managing director Bill Barnett opines: “The shift we are seeing is that tourism is driving a long-stay rental market on the island. This is the destination’s marketing funnel for a residential-led hospitality market and regional buyers from Thailand, Singapore and Hong Kong are leading the way.”

Key findings

C9 Hotelworks’ report reveals that for the equivalent price of a two-bedroom condo in Singapore, investors can snap up a five-bedroom pool villa in Phuket, while a luxury car is approximately 60 percent less expensive in Thailand. 

For families, international school fees are, on average, 42 percent lower in Phuket than in Singapore. 

With high taxation and stamp duty on second homes in Singapore, and almost 150 weekly flights now operating the two-hour hop between Singapore and Phuket, the advantages of resettlement or investment on the shores of the Andaman Sea are clear.

Barnett said of this: “Our forecast is that global and regional migration trends are going to continue to fuel growth in investment properties. In a volatile marketplace, investment flight to Thailand as a safe haven is an attractive long-term proposition with people looking for recurring yields and stabilised returns from long term rentals.”

Resort-inspired developments are the trend

The surge in interest in lifestyle investments is not lost on some of the island’s most successful developers.

In fact, Hong Kong’s Lan Kwai Fong (LKF) Group, famed for its Andara Resort & Villas development in Kamala, is launching a sister brand, Sudara, in the hot spot beach district of Bangtao.

Dr Allan Zeman, founder and chairman of the LKF Group, said: “Our Thai investment story started with Andara and we have now come full circle. We went from property to hospitality and now back to residential with Sudara. We see Thailand’s tourism momentum as a key catalyst for growth to capture the two synergies of hospitality and residential and the increase in regional buyers are playing a key role in our success.”

Phuket is experiencing strong demand from Asian buyers, particularly in Hong Kong, where the LKF Group is headquartered. 

Sudara Residences Phuket reports that most regional sales come from Asia-based locals and expatriates, driven by factors such as affordability and accessibility.

The new development is a prime example of the new generation of resort-style projects attracting regional buyers looking for lifestyle options and rental returns. 

It offers 220 bright one- to three-bedroom residences ranging from 52 to 144 square metres in size, including options with private pools. 

Sudara’s main clubhouse, the Pavilion, features outdoor pools, an alfresco lounge with cabanas, a kids’ club, fitness centre, Silk Café, yoga space, and co-working areas, all supported by management and concierge services from the ultra-luxury Andara Resort & Villas.  

The project expects to be completed by 2027.