Thailand Hospitality Report:

The economy and mid-scale hotel segment is the fastest-growing sector in Thailand’s hospitality industry, with a projected growth rate of about 30% from 2024 to 2029. This surge is fueled by rising demand from cost-conscious travelers, particularly young tourists, digital nomads, and backpackers, who value affordability and essential comforts. These hotels are strategically located in both urban centers and key tourist destinations, offering basic yet clean accommodations and modern amenities such as Wi-Fi, flat-screen TVs, and accessible dining options.

   •    Primary customers: Young travelers, digital nomads, middle-class families, and tourists from emerging Asian markets.
   •    Top destinations: Bangkok, Phuket, Chiang Mai, Pattaya, and Koh Samui are seeing the highest concentration of new economy hotel supply.
   •    Room rates: In December 2024, 39% of economy hotels charged THB 1,500–2,499 per night, another 39% charged THB 1,000–1,499, and only 15% were below THB 1,000.

   •    Total hotel rooms (2024): Nearly 700,000 nationwide; Bangkok leads with about 173,600 rooms.
   •    Economy hotel share: While exact figures are not specified, economy and midscale hotels together make up a substantial portion, with mid and upper mid-scale hotels alone accounting for 46% of the market.
5-Year Outlook (2025–2029)

   •    The economy and mid scale hotel segment is expected to maintain its rapid expansion, benefiting from Thailand’s increasing international arrivals and the popularity of budget-friendly travel.
   •    Occupancy and rates: Occupancy rates for economy hotels are rising, and room rates are gradually increasing as demand strengthens.
   •    Competitive landscape: Both independent and branded chains are expanding, with global brands introducing budget options to capture market share.

  •    Urban and secondary cities: Focus on high-traffic urban centers and emerging tourist destinations where demand for affordable accommodation is strongest.
   •    Modernization and amenities: Invest in upgrading facilities-reliable Wi-Fi, clean rooms, and efficient service-to attract digital nomads and young travelers.
   •    Brand partnerships: Working with Aspira Hotels an established economy and mid scale brand  to leverage marketing and operational support.
   •    Government incentives: Explore incentives from the Board of Investment (BOI), including tax holidays and financial benefits for hotel development.
   •    Sustainability and tech: Incorporate sustainable practices and smart technology to improve efficiency and appeal to environmentally conscious guests.

Thailand’s economy hotel sector offers robust growth potential, driven by evolving traveler preferences and a strong tourism rebound. Investors should prioritize locations with rising tourist inflows, focus on operational efficiency, and capitalize on government incentives to maximize returns in this dynamic segment.