Midscale and economy hotels in Singapore performed better than their luxury counterparts in the first six months of 2015, reversing the trend seen in previous quarters, property services firm CBRE said in a report on Wednesday (Aug 12).
This is because tourists from the region had become more price-sensitive in light of the Singapore dollar’s appreciation against currencies like the ringgit and rupiah.
CBRE estimates the occupancy rates for midscale hotels rose 2.8 percentage points year-on-year to 83.8 per cent, while occupancy for economy hotels rose 1.2 percentage points to 82 per cent. Occupancy in the luxury segment decreased 5.2 percentage points to 80.6 per cent.
For the hotel sector as a whole, the overall average daily rate (ADR) decreased 3.4 per cent to S$251.48.
Looking ahead, CBRE said it expects Singapore’s tourism industry to face several headwinds if the Singapore dollar continues to appreciate against regional currencies. Within Asia, competition for tourist dollars has intensified, with Thailand and Japan boasting strong visitor arrivals.
A steady supply of hotels in the pipeline will continue to put pressure on occupancy rates and ADR over the next 12 months, CBRE added.
Source : Channel NewsAsia – 12 Aug 2015