Luang Prabang faces mega challenges

One of Southeast Asia's most charming cultural heritage destinations, Luang Prabang, is fast approaching a tipping point, claims C9 Hotelworks managing director Bill Barnett.According to Mr Barnett's latest Luang Prabang Hotel Market Update, a large-scale airport expansion and high-speed railway are major indicators of imminent change.

C9 Hotelworks managing director, Bill Barnett, said a runway expansion capable of handling wide-body aircraft will open in 2013, and the following year a high-speed railway link to China will become operational.

Documented timetable presented by the Chinese indicated construction would be completed at the earliest in 2015 and currently the project is on hold, pending investigations into China's railways contracting procedures.

Based on reliable sources, the high-speed railway project is more likely to be completed by 2020. A station is planned for Luang Prabang across the river in a proposed new town.TTR Weekly also learned that the Chinese were demanding exclusive use of a corridor of land, 5 km on either side of the entire track outside of towns and settlements, for industrial and agricultural purposes.

Key research data showed 2010and#8242;s year-on-year growth in airport passenger arrivals of 14% tallied in at 77,978. Growth in average room rates and RevPAR compensated for a slight dip in market wide occupancy.

A slowdown in tourist arrivals was driven by two important source markets, Thailand and the UK, which declined 43% and 16% respectively. Political events and currency deprecation accounted for the trend.

Recent developments on the ground include the opening of an 18-hole golf course by a Korean joint-venture company which includes more phases for a 250 room hotel and 100 upscale villas.The existing hotel supply of 44 hotels will increase 16% by 2012.

As to the impact on what has largely been a sustained low impact tourism footprint during the last decade, Mr. Barnett added: A short term identity crises looks inevitable as one chapter closes and another is set to begin.Unfortunately the next development cycle looks set to focus on growth for growth's sake, which is at odds with the destination's unique DNA.

Airlift and rail access improvements will see the emergence of new opportunities for a wider range of hotel products due to an overall upward progression. I expect to see a new mid-scale hotel tier emerge as the broader market edges towards more reliance on volume.

Source = ttrweekly