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Phuket property in recovery mode

June 3, 2010

While Phuket was untouched by Bangkok’s recent unrest, the resort island’s tourism and real estate sectors are back in recovery mode to win back visitors alarmed by clashes in the capitals.

Phuket, as ever, exudes an atmosphere of timeless tranquility as it enters the rainy season. But this year’s low season will register a far deeper plunge than in previous years, after images of violent clashes 500 miles to the north in Bangkok dampened demand for all Thai destinations.

With 70% of the Phuket’s economy provided by tourism, if the next high season also proves a washout, the cost will be heavy. Yet many tourism and real estate professionals are already finding grounds for optimism.

Above all, Phuket – and Thailand – have had excellent preparation for the upcoming challenge, says Cyrille Hareux of Bangkok-based real estate agency Company Vauban.

‘Since I set up my company in Thailand five years ago, I have seen the country live through a succession of crises – including Sars, bird flu, swine flu, the airport blockade and the abandoned summit in Pattaya – and the one thing they have all shown is Thailand’s incredible resilience,’

says Cyrille Hareux.

In his view, Phuket will once again triumph over adversity.

‘Phuket’s ability to recover is seen clearly in how swiftly the island bounced back from the Boxing Day tsunami – in fact, in the longer run, that crisis could be seen as having fuelled its development,’ says Cyrille Hareux.

Real estate professionals also find grounds for optimism in two key factors – the ability of Phuket to promote itself separately from Thailand, and the uniqueness of what the island can offer.

‘If you look at similar situations in the past, Bali distanced itself from Indonesia when there were bombings in Jakarta and Cebu established its separate identity during troubles in Manila,’

says Bill Barnett of C9 Hotelworks, a hotel management and consultancy firm based in Phuket.

Phuket’s emergence as an independent destination from Thailand is already well under way. As well as having its own marketing strategy, the island is now served by a growing number of direct flights from low-cost carriers.

‘From the perspective of a property investor, this independence from the mainland is very appealing,’ says Cyrille Hareux.

‘Owners from Singapore or Hong Kong, for instance, need not transit at Bangkok. And they also have the added reassurance of Phuket’s social and political stability – for historic reasons, the conflict between red shirts and yellow shirts has no relevance here.’

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