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Market Watch - Page 13:

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Khao Lak – Back To The Future.

 

 

 

Fabulous west-coast, white-sand beaches on the doorstep of your five-star hotel, close to international airport and kilometers of natural rainforest. If you hadn't guessed by now, it's our northern resort neighbour Khao Lak.

Driving through Phang Nga, I was reminded of what Phuket looked like when I first visited in the early 80's. Seeing the simple life of the passing countryside is always a welcome respite from what's becoming more an urban lifestyle in our fast developing region.

As we are in the cusp of low and high season, a vast number of shop houses, businesses and restaurants are closed on the main highway and in the tourism area. The European tourists arriving in dribs and drabs are mainly budget travellers, so hotels yet to start nightly entertainment, making nightlife nearly non existent. The common chorus of locals is, “Wait until next month, everything will be open again.”

One of the area's best-kept secrets is the recently upgraded and internationally branded Ramada Khao Lak, a smallish and affordable modern boutique resort with intriguing design features, such as wooden bathtubs in the bathrooms.

Just a short drive out of town is the Sarojin. Arguably the upper crust of what's on offer, this internationally acclaimed property has won consistent recognition on global travel weather vanes, such as TripAdvisorcom.

Enjoying year-round high occupancy with average room rates in line with Phuket, the Sarojin gives a glimpse of what Khao Lak can achieve. More brands are moving into the area, including the Meridien Khao Lak and the Kempenski, which is currently under development. It's been reported that the Similana has been acquired by the Minor group and will be redeveloped into an upper-tier Anantara product.

Seasonal fluctuations remain the biggest obstacle to large- scale developments in the area not unlike areas such as Kata or

 

 

 

 

Karon, where tourism is Eurocentric along with a growing Scandinavian contingent. 

Come low season, business owners roll up the welcome mat, return to Phuket, Bangkok or their own local abodes and wait for the rains to stop. On reflection, it wasn't long ago that mighty Phuket also had highs and lows, but it has managed a transition into a year-round destination.

Beachfront properties are no bargains in Khao Lak, with oceanfront land costing about 15 to 20 million baht a rai, similar to Krabi, Natai and Phuket. The key difference is that more reasonably priced land near the beach remains in abundance, with many fairly large plots in the area of one to three million baht a rai.

The residential market is in its infancy. Except for a few projects being sold to Nordic markets, there are no substantial products apart from rows of commercial shophouses, which dominate the area.

Getting back to the future, what exactly lays in store for the region? Certainly, land prices in the area are undervalued. With white-sand beaches, accessible transportation hubs plus hotels and resorts reaching critical mass, the area is set to move forward.

Key indicators that bode well for the area include the continued development of the Tah Sai area, where global players such as Raffles are developing mixed use projects, and the redevelopment of Tai Muang into a large- scale, master-planned resort.

What's missing is an airport, which would seem a natural progression given with the current expansion of low-cost carriers.

On paper, Khao Lak should be Greater Phuket's next big thing. Despite a somewhat tarnished image, I'd lay odds on the area being a great success in the next few years.

However, the property market still needs to define itself and move from a field of dreams to something more tangible.

 

   

Bill Bamett is Managing Director of C9 Hotelworks a Phuket hotel and residential consulting firm With more 20 years experience in the region, he has played an active role in some of the island biggest develovments.

       
       
Articles: 2009
 

Koh Samui's Luxury Market Emerges

 

The Next Big Thing In Ocean Front Real Estate

 

Predicting The Year Ahead - 2009

 

Phuket For Sale

 

Is Phuket Property Too Expensive

 

Is Phuket Ready For Fractional Ownership?

 

Koh Samui's Emerging Luxury Market Part 2

 

The Winds Of Change

 

Phuket Luxury Villa Market Update Part 1

 

 

       
 

Archived Articles: 2007 - 2008

 

Krabi - On The Edge Of A Boom

 

US Financial Crisis - Living The Sub-Prime Life

 

Rental Income - Investment Rent And Raves

 

Aesthetics - Out With The New, In With The Old

 

Hotel Branded Realestate, Battle Of The Brands

 

Local Communities - Cables Gone Wild

 

Rental Property - Plus & Minus, Buying A Hotel Unit

 

Aesthetics - Bold Designs Keep Boredom At Bay

 

Agent Commission, The Low Down About Paying Up

 

US Financial Crisis - Clouds The Property Horizon

 

Phuket - The Next Big Property Trend 2007

 

Vietnam, Too Fast Too Soon

 

Pre-plan your purchase, and prevent future pain

 

How we should protect the property cash cow

 

Timeshare, High End Fractional Ownership Matures

 

Budget Hotel Brands Shake Up The Scene

 

Re-Inventing Patong

 

Bali, (property) Supply Surges Ahead

 

Property Developers - Number Crunching Pays Off

 

Phuket, Battle to preserve the beaches

 

Aesthetics - Designing For Success

 

Phuket Luxury Villa Market Update Feb 2009

 

Low Season - Cyclical Cynics

   
 

 

   
 
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