Despite the regional economic uncertainty, the Pan Pacific Hotels Group is betting that Singapore’s tourism and hospitality industry will remain robust this year, with big expansion plans after a period of relative quiet.
The newest addition to the group’s Singapore portfolio, the upper upscale Parkroyal on Pickering hotel opens its doors today after about four years of construction.
While it will likely be a year before the S$350-million project delivers stable performance, it will be part of an expanding asset base that fuels the group’s long-term growth here, said Chief Executive Patrick Imbardelli.
“We already have Pan Pacific Singapore and Pan Pacific Orchard, we have Parkroyal on Beach Road, Pan Pacific Serviced Suites in Somerset, to name a few.
“And this year, in addition to Parkroyal on Pickering, we’re also opening in April 180 units of Pan Pacific Serviced Suites Beach Road in Singapore, which is another S$100-million investment,” Mr Imbardelli told TODAY.
“With our existing asset base here, and a further S$450-million investment this year, I think we’ve got a lot of confidence for our position going forward,” he added.
The new launches for this year follow the completion of renovations at Pan Pacific Singapore and Pan Pacific Orchard last year.
The temporary closure of Pan Pacific Singapore resulted in an atypical year in terms of performance, said Mr Imbardelli, adding that the group is again expecting at least moderate growth this year.
Pan Pacific’s plans come amid some uncertainty about the health of Singapore’s hospitality industry. In December, OCBC Investment Research downgraded hospitality counters to neutral after forecasting a muted first half this year.
But Mr Imbardelli remains cautiously optimistic.
“We’re living in a time of economic uncertainties, and we expect what’s happening to the United States and European economy to have an impact. Against this backdrop, this year we’re prepared for stabilised growth. We’re not saying it’s going to be huge, but neither will we see a recession,” he said.
And Singapore’s hospitality industry is still on track for long-term growth in demand, said Mr Imbardelli, as new attractions and infrastructure are constantly being developed to keep the island relevant as a tourist and business destination.
Also supporting that growth is the increasing number of Asian tourist arrivals, with Mr Imbardelli noting that Chinese visitors form a rapidly emerging segment.
“But do we want to rely only on that? No, we don’t. We don’t want to have an over-reliance on (customers from) any one geography. Instead we want to position our hotels to have a balance of geographies and segments, so that when a segment starts to slow down, we can move on to another and protect our business,” he said.
Source : Today – 16 Jan 2013