Bangkok – The rapid increase in construction of new upmarket hotels along Bangkok’s Sukhumvit Road may foil efforts by established hoteliers to increase yield.

For the time being, properties such as the InterContinental, Landmark, Sheraton Grande and its sister property, Westin Grande, are enjoying a satisfactory corporate rate.

But, with the imminent opening of at least five major new properties in the next 18 months, that rate battle could be conceded.

Landmark hotel general manager, Mr Frank Clovyn, summed it up when he said the major increase in inventory was coming at a time when area hotels had just started seeing growth in yield after a tough couple of years.

Mr Clovyn said: “Price reductions at the new hotels in their post-opening period are bound to affect yield and actual market share for existing hotels.”

The hotels Mr Clovyn and other hoteliers are keeping their eye on are the Crowne Plaza Sukhumvit, Sofitel Sukhumvit, Kempinski, Central World Plaza and the yet to be named hotel in the Royal Rajdamri complex behind the Grande Hyatt Erawan.

Between them, these five properties will add 1,903 rooms, boosting total inventory along the Sukhumvit-Ploenchit strip by a massive 70 per cent.

Mr Clovyn said his strategy was to expand the Landmark’s base of corporate accounts and target the growing regional corporate meetings market.

JW Marriott general manager, Mr Peter Caprez, acknowledged existing hotels could get sucked into corporate rate wars when new hotels opened with discounted rates.

“But, if we can keep our average room rate above 4,000 baht (US$100), we will be less affected.

New additions such as wireless Internet and two new restaurants by October will give us leverage to negotiate new contract rates for our corporate accounts and at the end of the day, the customer will get a higher quality product,” Mr Caprez said.