Serviced apartments are still being built and projects will con?tinue to open until at least 2014, but amid increased competition from condominiums and apart?ments offering a similar level of comfort and amenities in the same areas of the city, but at lower rents, according to Colliers International (Thailand).

An additional challenge is that the Thailand Hotel Association is trying to persuade the Interior Ministry to crack down on serviced apartments offering daily or short-term leases, which are not permitted without a hotel licence. Should the ministry take action, enforcement of this rule will have a significant impact on the sector.

Fewer serviced apartments came on the market in the second quarter than in the first, but a drop in demand of 4.8 per cent has kept rents stable.

Three serviced-apartment projects opened in the first half with about 280 units in three locations in the city. The total supply of serviced apartments as of the end of the first half is about 17,970 units. Because of intense competition, development of serviced apartments in Bangkok has decreased every year since 2009 and will continue to decline.

The number of serviced apart?ments in early Sukhumvit is signif?icantly higher than any other area, by 115-650 per cent. From 1992 until the first half of 2012, the early Sukhumvit area has shown the highest share of the total mar?ket, while the lowest supply of serviced apartments in Bangkok is in the southern fringe, where there are fewer than 1,000 units.

More than 200 units are sched?uled to be completed in the second half, and about 70 are due next year. The total number of serviced apartments in Bangkok by the end of this year, including these 200 units, will be nearly 18,100.


Nearly 80 units, or about 40 per cent of supply for the rest of this year, will be in the late Sukhumvit area. In the past, all serviced apartments focused on foreigners or expatriates in Bangkok, most of whom needed to stay in the city area or close to the mass transit system. Now, because of limited budgets over the past few years and the opening of Skytrain extensions to the east and west, some have decided to stay outside the city area to take advantage of cheaper rents.
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