Hotel Saturation Point in Koh Phangan

Hotel Saturation Point in Koh Phangan

Koh Phangan has long been viewed as the poor sister to Koh Samui. During the 80s, 90s and noughties the island was commonly considered as attempting to catch up with its neighbouring island in terms of hotels, restaurants and infrastructure. Recently the number of hotels listed on Trip Advisor for Koh Phangan has dropped. It looks like Koh Phangan has reached saturation point for hotels.

As a holiday destination becomes more popular the number of hotels available increases. This is the age old economic dictum of supply and demand. Increased popularity means more demand. Supply will increase to meet the demand. If the supply of hotel rooms is decreasing that means the demand is falling.

Koh Phangan has over 20 beaches. Each beach has its own set of resorts, shops, restaurants and services. A few beaches on the east coast are virtually free of commercial activity such as Haad Nam Tok, Haad Yang and Haad Khontee. There is scope for developing these beaches to increase supply of rooms and to drum up new trade. However, these beaches are fairly inaccessible other than by sea – they are locked out of the road system by thick jungle and mountainous terrain.

There was a point between 2010 and 2015 when these east coast beaches looked like being bought up by developers for luxury resorts. However, with the collapse of the Koh Phangan Airport project the money and offers have dried up. For the time being Koh Phangan’s beautiful east coast below Haad Than Sadet will remain the playground for adventurous hippies.

In 2016 the number of hotels listed on Trip Advisor was 92. In 2017 that number became 89. That is the first time I have noticed the number of hotels in Koh Phangan decrease. I don’t believe it is Trip Advisor overlooking what’s on the ground. It is genuinely that there are less hotels in 2017 than there were in 2016.

It feels like saturation point. We have witnessed the full extent of Koh Phangan’s ability to grow tourism under its present culture of parties, yoga, ex-pats and cheap to mid-range accommodation.

The current administration in Bangkok has singled out Haad Rin along with Pattaya and the red light districts of Bangkok as far from desirable. They have a moral dimension to their governance. The law is upheld selectively; the far worse ‘sin’ is to bring the Kingdom into disrepute through tales of anything goes prostitution and partying.

The Koh Phangan parties have been made to clean up their acts to some extent. They have responded with better facilities and security and higher prices. One wonders how long the world’s youth will remain interested in coming to Koh Phangan to party.

What is needed is responsible infrastructure development. The roads in Koh Phangan are worse than in Koh Samui in terms of quality and in terms of coverage. Water shortages are a problem in the dry months. The electricity supply is still erratic. Public transport has been held back by the taxi mafia. Nothing like the cheap songthaew plying fixed routes in Koh Samui is found on Koh Phangan. It is a shame as forums and comment streams about Koh Samui make it very clear that tourists really value the convenience and cheapness of the songthaew bus style system. It means no more fruitless haggling and no more waiting for extra passengers.

Better hotels, better service and better infrastructure is what Koh Phangan needs to see the number of hotels increase. The island doesn’t need more parties or more DJs or more yoga experts.

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