Transactions at hotels in 2025 predicted to decline to common amounts, aimed to reach THB 13 billion
Thailand's Hotel Market Shows Strong Recovery and Growth in 2025
Bangkok continues to be the primary investment center in Thailand, accounting for 60% of nationwide transaction values. In 2025, the hotel market in Thailand is expected to normalize, with total transaction values estimated to be around 13 billion baht, according to JLL.
The hotel market in 2025 is characterized by a strong recovery and growth, with significant trends in alternative financing, green initiatives, and evolving deal structures.
Alternative Financing and Deal Structures
There is a noticeable shift toward asset-light business models among hotel operators in Thailand. Companies are favoring management contracts and franchising over direct property ownership, enabling more efficient expansion with reduced capital burden. Major hospitality groups like Minor International are adopting this strategy to increase financial flexibility and resilience against market fluctuations.
The condotel market is rapidly expanding, especially in key destinations like Pattaya and Phuket. This model allows individual investors to own units operated under hotel licenses with short-term rental opportunities, providing flexible ownership and rental income streams. The growth in condotels reflects investor confidence and represents an alternative investment avenue beyond conventional hotel assets.
Foreign investment interest remains strong, particularly from Chinese and Russian buyers in coastal areas, reinforcing Thailand’s appeal as a tourism and investment destination.
While direct data on innovative financing such as green bonds or ESG-linked financing specifically in Thailand’s hotel market was not identified, the global trend toward value-add repositioning of hotels including digital and infrastructure upgrades (such as energy-efficient systems) is influencing hospitality investments worldwide and aligns with shifts seen in other markets.
Green Initiatives
Though Thailand-specific green initiatives in hotels were not detailed explicitly, the broader hospitality industry trend strongly emphasizes energy-efficient systems and sustainable infrastructure upgrades as part of value-add investment strategies, aiming for enhanced sustainability and guest experience. This trend is also reflected globally in repositioning hotels with green and tech-enabled features.
The rise in wellness tourism and experiential travel (focused on natural beauty and health) in Thailand also signals a market shift toward more sustainable and lifestyle-oriented offerings, which likely encourage eco-friendly operations and certifications indirectly supporting green initiatives.
Overall Market and Investment Trends
The Thai hotel sector in 2025 is seeing rising occupancy rates projected to reach around 75% nationally and increasing average room rates by approximately 5%, driven by renovations, service upgrades, and government tourism promotions.
Pattaya leads with robust demand and growing investment in tourism infrastructure, while markets like Koh Samui are experiencing expansion in independent villa rentals, reflecting diversification in accommodation types.
Bank Financing and the Future of Hotel Investment
Thai banks and international financial institutions are offering environmentally focused development loans to hotel operators, guided by the Bank of Thailand's central standards. The hotel investment market in 2025 is seen as a solid foundation for strategic moves that better prepare investors for a rapidly changing future, according to JLL.
The hotel investment strategy in 2025 is shifting towards higher-quality capital deployment rather than volume, with a growing preference for deals focusing on single hotels rather than portfolios of multiple properties. JLL notes that financial opportunities are expanding in the hotel market, with flexible loan terms, access to non-bank financing, and green financing becoming available.
In conclusion, Thailand’s hotel market is evolving towards financial flexibility, investor diversification, and gradual integration of sustainable practices to capitalize on growing tourism demand in 2025. The market is expected to normalize with transaction values returning to average levels compared to 2024’s record-breaking market.
- Bangkok, being the main investment hub in Thailand, is anticipated to continue accounting for a large portion of the nationwide transaction values in the real estate market, particularly in the hotel sector.
- In 2025, the hotel market in Thailand is expected to undergo significant trends in both alternative financing and green initiatives, as operators increasingly favor management contracts, franchising, and condotel models to reduce capital burden and appeal to individual investors.
- Foreign investors, notably those from China and Russia, continue to demonstrate strong interest in Thailand’s coastal areas, reinforcing its appeal as an attractive tourism and investment destination.
- The Thai hotel market is projected to see a rise in wellness tourism and experiential travel focused on natural beauty and health, likely encouraging eco-friendly operations and indirectly supporting green initiatives.
- In the future, Thai banks and international financial institutions are anticipated to offer environmentally focused development loans to hotel operators, with a growing preference for deals focusing on single hotels rather than portfolios of multiple properties, indicating a shift toward higher-quality capital deployment in the hotel investment market.
