Thailander

The Land of Smiles

  • Home
  • About
  • Visiting the Land of Smiles

Hotel Investment Opportunity Decision Model In Thailand

June 20, 2008 By Thailander Thailander

It is amazing how often investors from all horizons and calibers are basing their investment decision on a very emotional aspect. It is true that Thailand, especially the island of Phuket, offers exceptional sceneries, pristine white sand beaches, fantastic climate, and great hospitality. Not to mention the kindness and friendliness of the Thai people. On the other hand, it is also true that too often Land & Hotel Properties are drastically over priced compared to the value they have been purchased few years back. And yet outrageous deals are being made heading to disastrous investments that can take more than 20, 30, 50, 100, or even more years for a return on investment! Here are three easy steps to avoid such financial disasters when considering investing in the Hotel Industry in Phuket.

Benchmark your project potential Revenue in a realistic manner and on a conservative side. Remember that economic cycles repeat themselves every decade, so sampling a period having experienced Peak, High, Low and very Low Demands will serve as a good base to establish a fair business trend. Finding out your project competition Average Room Rate, Occupancy, Extra Revenue and Cost will guide you to a good Profit estimate. Working out those figures over 10 years, without taking into consideration Rates or Occupancy increments, will cover a return on investment including loan interests and loan Pay back, and, will give you a pretty good overall results assessment.

Consider all costs that might occur when purchasing your project. Such as hotel construction cost for a new property on an empty land, which usually is an average spending per room built that include all the hotel facilities and technical requirements. Note that the higher your project standard is, the higher the cost per room will be. Or, if your project is already built, decide if you want to operate the hotel as it is or renovate it. Renovation should always be the preferred option. Here also, you should work out an average cost per room built. You have now your Investment cost.

Deduct this investment cost, if any, to your Potential Profit (over a 10 years period) and the result of this simple deduction will give you an idea of the financial value of the Land or Property you intend to buy. You might be shocked by the difference between the so-called “market” price and your figure, but this will definitely be the right amount and no other consideration should affect the figure you have just calculated.

Now you are ready to offer a “down-to-earth” Bid for your investment, and once again, do not get emotionally involved nor carried away by potential astonishing revenue opportunities… Economic cycles contain high and low period, so you are looking at an average. Plus you just did the math taking into consideration all positive and negative aspects, so there is no reason to purchase higher! The best way to handle such investment is to consider two, three or more alternatives of the same nature and to deal with them one at a time until you get the transaction you are looking for.

Filed Under: Investing Tagged With: Calibers, Horizons, Phuket

Tags

15 Months Absolute Pleasure Andaman Sea Baht Bangkok Best Beaches Buddhist Temples Business Visa Cheap Travel Colorful Flowers Constitutional Monarchy Fiance Visa floating market Fruit Lovers Full Moon Party Grievance Health Tourism Jet Skis Kingdom Of Thailand King Rama Luxury Restaurants Mountain Areas Outdoor Enthusiasts Phi Phi Phuket Private Clinics Quality Golf resorts Spiritual Haven Supermarkets Thai Customs Thai food Thailand Thailand Government Thailand Travel Thai Marriage Thai Word tips Tourists Tourist Visa travel Travel And Tourism University Hospitals Visa Application Visa Thailand

Categories

  • A Delicious Vegetarian Maharashtrian Thali In Pune India
  • Arts And Entertainment
  • Best Approach To Tax Problem
  • Business And Market Overview Of Indonesia
  • Buying Cars Online With Cars4thais
  • Communications
  • Creative Real Estate Financing Methods
  • Crocodile Farm
  • Cutting Costs On That Fabulous Cruise
  • Discount Hotels In Japan
  • Enter The Oasis Of Dusit Princess Koh Chang
  • Finance
  • Flights To Accra And Kotoka International Airport
  • Global Medical Book Announcing Their Definition Of Medical Tourism
  • Green Card Lottery USAFIS United States Immigration Part Two Hundred Thirty Four
  • Health And Fitness
  • Home And Family
  • Home Improvement
  • Hotels! Hotels! Pick Your Hotel!
  • How To Say Sorry To Your Man – Help For Women Who've Made A Mistake
  • Hua Hin And Prachupuap Khirikan
  • Insurance
  • Internet And Businesses Online
  • Investing
  • Krabi A Destination For Relaxing Vacation
  • L.A. Rental Car Offers The Best Possible Car Rental Deals
  • Lamai
  • Lapland Is The Perfect Summer Destination
  • Legal
  • Medical Tourism And Global Healthcare Where Are You Going?
  • News And Society
  • Pattaya Red Light District Where You Should Stay For Holiday
  • Personal Ads
  • Probationary Period
  • Real Estate
  • Recreation And Sports
  • Reference And Education
  • Relationships
  • Retain Only The Best Criminal Attorney
  • Shopping And Product Reviews
  • Stay In Luxury Beach Hotel In Phuket
  • Sukhumvit – The Quintessential Thai Nocturnal Experience
  • Thai Women For Marriage & Dating At Online Dating Sites
  • Thailand Spa
  • Thailand</b> As An Outsourced Software Development Destination
  • Thailand</b> At Booking Station
  • Thailand</b> Dating Services
  • Thailand</b> For Thai And Foreign Companies
  • Thailand</b> Gap Year Choices
  • Thailand</b> Hotel
  • Thailand</b> Hotels Booking
  • Thailand</b> LNG Export And Import Markets To 2015 Aarkstore Enterprise Market Research
  • Thailand</b> Mail Order Brides At Thai Dating Service
  • Thailand</b> Make For An Intriguing Holiday
  • Thailand</b> Travel In 5 Easy Steps
  • Thailand</b> Women For Love And Marriage At Bangkok Dating Sites
  • Tokyo Eatables, Timesaving And Cost Low
  • Toronto Airport Limousine Service
  • Travel And Leisure
  • Travel Company
  • Travel Tips: Bangkok Flight Travelers
  • UKRAINE TRY TO ATTRACT OIL AND GAS INVESTORS BUT LACK INFRASTRUCTURE TO DO SO
  • Uncategorized
  • US K1 Fiancee Visa: When Can My Thai Fiancee Travel To The USA?
  • Vacations

Copyright © 2023 Thailander.com · WordPress · Log in