Bangkok’s hotel sector is under pressure as occupancy rates slipped in the first half of 2025, despite a modest increase in international tourist arrivals.
Industry analysts warn that rising competition, weaker demand from Chinese travellers, and the rapid growth of new hotel supply are testing the city’s tourism competitiveness.
Hotel occupancy in Bangkok falls amid rising supply
Data from Knight Frank Chartered (Thailand) shows average hotel occupancy in Bangkok declined to 75.1% between January and June 2025, a drop of 3.7 percentage points compared with the same period last year.
Rates were strong early in the year, with January and February averaging more than 81%, but performance weakened from March onwards, reaching just 69.8% in June, the lowest level in over 12 months.
The average daily rate (ADR) edged up 3.3% year-on-year to 4,260 baht, but this growth was not enough to offset the drop in occupancy. Revenue per available room (RevPAR) came under pressure, particularly in the mid-range hotel segment, where competition is intensifying.
Seven new properties, including the Grand Centre Point Lumpini and Four Points by Sheraton, added nearly 1,900 rooms in the first half of the year. A further 3,283 rooms are due to enter the market before December, the fastest expansion since the pandemic.
Chinese tourist arrivals decline sharply
One of the key factors behind weaker performance is the fall in Chinese arrivals, which dropped by almost 35% in the first half of 2025.
China remains Thailand’s largest source of visitors, but concerns about safety, negative publicity, and shifting travel preferences have diverted many tourists to other destinations.
Neighbouring countries such as Vietnam and Japan have seen strong demand, hosting 2.7 million and 3.13 million Chinese visitors respectively during the same period. Thailand’s mid-scale hotels and those reliant on group tours have felt the sharpest impact from this downturn.
While arrivals from India and Russia grew by 14.6% and 11.1% respectively, these increases were not sufficient to balance the losses from China and South Korea.
Overall, Thailand welcomed 21.8 million foreign tourists in the first eight months of 2025, a 7.1% year-on-year decline.
Domestic tourism and future outlook
Authorities have introduced measures to support the sector, including visa exemptions, improved regional flight connections, and domestic stimulus programmes such as the “Half-Half Thai Tourism” scheme.
These efforts are designed to encourage travel during the low season and sustain demand from local visitors.
However, industry experts note that the recovery will depend heavily on international markets and airline capacity. Strong year-end travel in November and December, supported by meetings, incentives, conferences and exhibitions (MICE), is expected to lift occupancy rates temporarily.
The luxury hotel sector remains comparatively stable, attracting high-income travellers and long-haul visitors, with Bangkok’s lower room prices offering an advantage over regional hubs like Singapore and Hong Kong.
Still, price competition is set to intensify across all segments as new supply enters the market.
