The logo of Spanish NH Hoteles chain is seen on the roof of one of its hotel in central Madrid October 28, 2009. (Reuters photo)

The Thai hotel industry is becoming increasingly competitive despite growth in visitor arrivals because the supply of hotels keeps increasing in Bangkok and other popular tourist destinations.

"Thai hotel groups are expanding overseas through management contracts, buying hotel properties and hotel operating companies," said Atakawee Choosang, head of CBRE Hotels, Thailand.

Thai hotel companies want to mitigate their risk by not being solely dependent on the Thai market. When Minor International completes its takeover bid of the NH Hotel Group, the combined group will be the 19th largest hotel company in the world, up from the 68^th currently. Minor International is buying 44.5% of the Spanish NH Hotel Group that owns and operates 382 hotels in Europe, Africa, and the Americas.

Singha Estate, the real estate arm of Boonrawd Brewery Group, is turning to overseas resort markets. It has acquired six Outrigger-branded hotels located in Thailand, Maldives, Mauritius, and Fiji from Outrigger Hotel Hawaii for 11.1 billion baht. The company has scaled up outside the country to expedite growth and enhance its international presence.

A Thai real estate group, Sansiri, has invested $58 million in a 35% stake in Standard International, a hotel group located in New York, Los Angeles, London, and Miami Beach.

Meanwhile, U City, the hotel arm and subsidiary of the BTS Group, a publicly listed hospitality player, has acquired the Vienna House group with 26 European hotels in five countries -- Germany, the Czech Republic, Poland, Romania, and Slovakia in their first overseas expansion.

CBRE believes that Thai hoteliers will continue to expand overseas to mitigate risk and diversify their sources of income by acquiring properties, managing properties owned by third parties, or acquiring overseas hotel operating companies.

In some cases, they want to grow and increase recognition of their hotel management brands by expanding their customer base.

Sutinee Chaowanich is an analyst at Research and Consulting, CBRE Thailand. She can be reached at bangkok@cbre.co.th Facebook: CBREThailand LinkedIn: CBRE Thailand LINE@: CBRE Thailand Twitter: @CBREThailand website: www.cbre.co.th