second Luxx ready to open

The successful Luxx boutique hotel will open a second branch next month amid the ongoing economic crisis.

The Luxx XL Hotel will open near the well-known shopping area of Soi Langsuan in Bangkok at a cost of Bt200 million, not including what was paid for the land. The 51-room hotel is aimed at strengthening the Luxx brand.

"We remain confident the situation in the Thai travel industry will gradually improve, because Thailand is very resilient to these kind of situations, and many tourists still love this destination," said owner and managing director Dusadee Srishevachart.

Dusadee said the decision to open a second Luxx Hotel was decided two years ago when the economy was more solid. But despite the present crisis, she feels there is no better opportunity to expand the Luxx brand and its unique hotel experience than now.

While the number of business travellers declines, due to their companies trying to save on travel costs, niche travel remains steady. Travellers are budget-conscious and carefully choose the right product to match their budget and needs.

As a result, the Luxx XL is not designed for mass tourism, but rather targeted at specific markets: within the age bracket of 21-55 and mid- to high-level business people.

The Luxx XL's occupancy rate is expected to be 55 per cent through the middle of the year, rising to 75 per cent by year-end.

It could take anywhere from five to 10 years to break even, but the company hopes travel to Thailand improves soon and that the numbers start to rebound. If so, the new branch could reach profitability earlier than expected.

Dusadee said Thailand's tourism industry was already positioned to recover lost ground. Although there will probably still be some political problems in the coming months, business seems to be about back to normal.

"News about Thai politics is moving off the front page now, and soon this will encourage many travellers to return. The Tourism Authority of Thailand has implemented an aggressive tourism-recovery plan and is working closely with the local tourism industry to bring back confidence in this destination," she said.

For instance, the overall hotel industry has reportedly been sluggish this quarter, due mostly to the pessimistic outlook for the global economy. However, Bangkok's small hotels have enjoyed occupancy of 70-90 per cent, which means they are getting the business of those small groups of travellers that are still coming in.