Performance figures may look glum for Asia’s hotel industry in 2009 but there is still plenty of evidence to show that the long-term outlook is rosy.
Room rates in the region have slumped by 2% year on year in Q4, 2008 according to the latest Hotels.com Hotel Price Index and have continued to follow a downward trend since with STR Global reporting double-digit decreases in US dollars for all three key performance metrics in February 2009 – occupancy dropped 12.1% to 59%; average daily rate (ADR) declined 21% to US$114.82; and revPAR fell 30.5% to 67.70.
However, there are plenty of hotels groups – both local and international – that are looking to expand aggressively across the Asia Pacific region over the next five years. They include top-end names such as Banyan Tree, Six Senses and Anantara as well as mid-market Asian hotel giants such as Berjaya Hotels & Resorts and Centara Hotels & Resorts.
“We are determined to drive forward with our plan to have 40 hotels both domestically and internationally by 2014 and see no reason why we should not achieve that objective,” said Centara Hotels and Resorts president Gerd Steeb.
The group will open two new five-star properties this year including the stunning Centara Grand Mirage Beach Resort Pattaya, a 555-key ‘lost world’ themed resort and the group’s fourth property on Phuket, the Centara Grand Beach Resort Phuket while simultaneously moving forward with the design process for a five-star property on Lanta Island.
“We are looking at opportunities for the group to manage properties that can add to the strength of the brand including the management of a leading hotel in Udon Thani province in 2009 as well as taking over management of Bhundhari Resort, a five-star property located in Chaweng Noi Beach, Samui. We are also considering two additional properties located in Samui Island and in Pangan Island,” added Steeb.
At the top end, Singapore-based Banyan Tree has signaled its intention to expand in China having raised around $500 million for the development of five or six hotel projects across the country, including a new hotel in Tibet.
However, earlier this year, the group did announce a significant decrease in operating profit in 2008 due to political turmoil in Thailand and slowdown in the global economy.
STR Global managing director James Chappell noted that until December, hotels in Asia Pacific had witnessed a period of “sustained growth. However, the whole region has been hit hard by the global banking crisis,” he said.
He warned that China now faced a sharp decline in demand to add to the oversupply and noted that Japan has been struggling with a surge in the value of the Yen.
But STR data revealed that some markets fared well in February 2009 with Seoul in South Korea reporting the largest occupancy increase year on year, jumping 22.1% to 84.8%; and Tokyo, Bali and Osaka all reporting small increases in ADR at +5.4%, +2.6% and +1.5% respectively. Phuket reported the largest occupancy decrease (-30.2% to 61.4%) and revPAR dropped 53.8% to $73.12).
PATA strategic intelligence director John Koldowski said there was still cause for “cautious optimism” this year as the forthcoming PATA Tourism Forecasts 2009-2011 suggest growth in international arrivals for many destinations across the region – despite the global economic downturn.
Six Senses Resorts & Spas managing director and chief business development officer Bernhard Bohnenberger said the Bangkok-based firm would continue to expand and was lucky in that the majority of its investors were experienced in dealing with economic downturns and were “willing to work together to get through the current troubles”.As a result, the company was currently finishing its new flagship resort, Soneva Kiri in Thailand.
“In terms of the pipeline, there has been some slowdown in the construction of projects that we have signed already and also in the arrival of new potential projects, so we are focusing on well-funded hotels at the moment and we are lucky that our track record is still bringing to us a wide range of new and well capitalised partners,” said Bohnenberger. Six Senses Resorts & Spas chairman and CEO Sonu Shivdasani confirmed that the group remained “in an aggressive growth period” and planned to open between seven and 12 new Six Senses Spas per year.
More expansion in Asia
- Swire Hotels will open a second hotel in China. Having recently opened The Opposiste House in Beijing, the firm will open The Upper House in Hong Kong with 117 rooms this October.
- Thailand’s Astudo Hotel & Resort Group has opened the Away Resort Pranburi in the Thai province of Prachuap Khiri Khan near Hua Hin.
- Accor will open the doors of the Novotel Manado in Indonesia on May 9.
- Capella Hotels and Resorts opened its flagship property, Capella Singapore in March.
- Six Senses will open Soneva Kiri on Koh Kood in June
