Baba Beach Club Phuket is a hotel and residence for music lovers on a 42-rai beachfront plot of Na Tai Beach in Phangnga. Charn Issara wants to sell the resort to a REIT.

SET-listed developer Charn Issara Development Plc (CI) will next year focus on selling remaining units at existing residential projects and expanding its hotel business as housing sales in the first nine months were not as good as expected.

Chief executive Songkran Issara said the company will be more cautious as the economy in 2018 will be steady or have a minimal expansion because of a weak world economy and high Thai household debt.

"Debt was higher while income dropped. The country's economy moved slowly as a decline in agricultural prices affected a majority of people," he said. "The only hope is the tourism industry."

Mr Songkran said the overall occupancy rate at Sri Panwa, a luxury resort in Phuket with 38 pool villas and seven pool suites, improved to 60% in the first nine months, compared with 57% a year before.

Thais made up 40% of the guests and Chinese 25%. The latter was a key driver as their numbers more than doubled from 12% last year, while Thais rose five percentage points. One of the most popular activities among Chinese was weddings.

Sri Panwa is owned by Sri Panwa Hospitality Real Estate Investment Trust (REIT), in which the company and its subsidiary Charn Issara Residence Co holds 30.39%.

Charn Issara also wants to sell two new resorts worth a combined 2 billion baht to the REIT.

Opened last month, Baba Beach Club Hua Hin has 18 pool suites and 11 pool villas, while Baba Beach Club Phuket has 16 rooms, 24 villas and 37 suite rooms.

"We aim to increase the hotel revenue proportion from 25% this year to 30-40% in the next four years," he said. "We also expect to manage three hotels in three Chinese cities because they use lower leverage."

The hotels are in Hainan, Kunming and Lijiang. The Hainan hotel is worth 18 billion baht and is in the conceptual design process. It will be opened in 2019 and the management contract will run 15 years.

"The Thai property market cannot rely on only domestic demand. Schemes are needed to attract foreigners to buy property, such as a longer visa for a property purchase or an extension on leasehold ownership to over 50 years," said Mr Songkran.

The company set a budget of 700-800 million baht to buy a land plot in the central business district to develop an upper-end condominium project next year, he said.

In the first nine months, the company recorded 1.4 billion baht in revenue and it expects 3 billion by year-end, similar to last year.

Of the nine-month revenue, 450 million baht was from hotel business, up from 400 million year-on-year. It aims to gain 600 million baht in hotel revenue this year.

"Next year we expect revenue growth of 5%," said Mr Songkran.

It has two luxury housing projects on Rama IX Road and Bang Na-Trat Road. The Rama IX posted 400 million baht in sales this year while the Bang Na-Trat site has not launched.

CI shares closed yesterday on the SET at 1.53 baht, down one satang, in trade worth 884,710 baht.