- Joined
- Apr 14, 2011
- Messages
- 18,137
- Points
- 113
sbr.com.sg
Singapore hotels brace for more pain even with bottom in sight
HOTELS & TOURISM | Staff Reporter, Singapore
Oversupply looms with an additional 7,300 rooms expected until 2018.
The hotel sector has shown signs of improvement across all segments in the first five months of the year, but with massive supply entering the market in the next 2-3 years, the outlook remained muted, said CBRE.
As of May 2016, Singapore welcomed approximately 6.89 million international visitors, this represents a double-digit 13.3% growth compared with the same period last year. The increase is fueled mainly by a spike from the top visitor markets, most notably China.
As a result, hotel performance improved in the first five months of 2016 despite overall Revenue Per Available Room (RevPAR) declining 0.7% to $200.37 over the same period. In particular, CBRE notes that the gap between room nights sold (RNS) and room nights available RNA is closing. RNS increased 7.8% YoY while RNA grew 6.1% YoY.
According to CBRE, occupancy levels remain resilient with the economy segment showing the strongest growth of 2.3 percentage points to 78.2%. Overall occupancy for the study period was 84%
Nevertheless, the research firm that there remained a small decline in the average daily rate (ADR).
Market-wide, ADR contracted 2.3% to $237.38. All segments, except the upscale, segment showed a dip in rates, with the economy segment suffering the most. This segment decreased 2% to $100.10 over the same period. Despite an increase of 1.1% to $263.46 for the upscale segment, occupancy dipped 0.3 percentage points to 85.56%.
CBRE cautioned that with a huge supply entering the marking in the next 2-3 years, hotel performance will still be a concern.
From H1 2016 to 2018, CBRE estimates that there will be approximately an additional 7,300 rooms entering the market, with 2017 having the largest increase in supply quantum.
Hotels opening in th next half of 2016 include the luxury 157-key Patina Capitol Singapore, 300-key Premier Inn Singapore Beach Road and 300-key Park Hotel Farrer Park, amongst others.
According to CBRE, the growth in inventory will create downward pressure on hotel's performance in terms of occupancy levels. It notes though that the spike in visitor arrivals year-to-date will help alleviate the adverse impact of the additional supply.
Singapore hotels brace for more pain even with bottom in sight
HOTELS & TOURISM | Staff Reporter, Singapore
Oversupply looms with an additional 7,300 rooms expected until 2018.
The hotel sector has shown signs of improvement across all segments in the first five months of the year, but with massive supply entering the market in the next 2-3 years, the outlook remained muted, said CBRE.
As of May 2016, Singapore welcomed approximately 6.89 million international visitors, this represents a double-digit 13.3% growth compared with the same period last year. The increase is fueled mainly by a spike from the top visitor markets, most notably China.
As a result, hotel performance improved in the first five months of 2016 despite overall Revenue Per Available Room (RevPAR) declining 0.7% to $200.37 over the same period. In particular, CBRE notes that the gap between room nights sold (RNS) and room nights available RNA is closing. RNS increased 7.8% YoY while RNA grew 6.1% YoY.
According to CBRE, occupancy levels remain resilient with the economy segment showing the strongest growth of 2.3 percentage points to 78.2%. Overall occupancy for the study period was 84%
Nevertheless, the research firm that there remained a small decline in the average daily rate (ADR).
Market-wide, ADR contracted 2.3% to $237.38. All segments, except the upscale, segment showed a dip in rates, with the economy segment suffering the most. This segment decreased 2% to $100.10 over the same period. Despite an increase of 1.1% to $263.46 for the upscale segment, occupancy dipped 0.3 percentage points to 85.56%.
CBRE cautioned that with a huge supply entering the marking in the next 2-3 years, hotel performance will still be a concern.
From H1 2016 to 2018, CBRE estimates that there will be approximately an additional 7,300 rooms entering the market, with 2017 having the largest increase in supply quantum.
Hotels opening in th next half of 2016 include the luxury 157-key Patina Capitol Singapore, 300-key Premier Inn Singapore Beach Road and 300-key Park Hotel Farrer Park, amongst others.
According to CBRE, the growth in inventory will create downward pressure on hotel's performance in terms of occupancy levels. It notes though that the spike in visitor arrivals year-to-date will help alleviate the adverse impact of the additional supply.
