Bangkok retail rental discounts reduced to 0-4% in mid-2023

Foreign arrivals have reached 80% of pre-pandemic levels.

The Bangkok retail market has made a significant recovery as of mid-2023, thanks to an increasing number of foreign tourists since last year. According to Knight Frank, the number of foreign arrivals as of June 2023 stood at 12.9 million. 

It is anticipated to reach a total of 28.5 million, which is approximately 71% of the levels seen in the year 2019, before the Covid-19 pandemic, by the end of this year. 

From January to May 2023, the top 5 countries in terms of foreign arrivals are as follows: 1. Malaysians: 2.10 million 2. Chinese: 1.44 million 3. Russians: 791 thousand 4. South Koreans: 763 thousand and 5. Indians: 761 thousand.

Here’s more from Knight Frank:

Overall, the Bangkok retail market is on a positive trajectory in 2023, with foreign tourism playing a significant role in its recovery.

In the first quarter of 2023, retailers in Bangkok made several adaptations. Large shopping centres either cancelled rental discounts or offered discounts of approximately 0-4% after the number of arrivals returned to 80% of the pre-Covid-19 period. The recovery in the number of foreign arrivals has been swift. In 2019, there were 39.9 million foreign arrivals, and it is expected to reach 28-30 million arrivals in 2023.

The total revenue of shopping centres has recovered to 50%-60% of the pre-Covid period. Celebrations were held for every festival, and new community malls have started to be developed, especially in proximity to international schools. There has been an accelerated push for mobile applications and increased stimulation of sales through promotions and gamification with various coin rewards.

Moreover, demand has rebounded, and tenants are returning to sign rental contracts in almost every segment, particularly in the restaurant segment, which includes shabu, grilled pork, and beauty, health, and wellness establishments.