S’pore hospitality industry still going strong

On the back of a projected increase in tourists arrivals, analysts at CBRE Hotels now expect hotel occupancy in Singapore to exceed 86 per cent, up from its previous projection of 83 to 86 per cent.

This despite an 11 per cent increase in supply of new hotels this year and an estimated six per cent increase next year and the year after.

Robert McIntosh, Executive Director (Asia Pacific) of CBRE Hotels, said: “(Based on) our calculations, we have a total this year of about 2,700 (new) hotel rooms and the following year, about 2,500 hotel rooms (will be) added to the supply. It looks like it will be absorbed pretty easily unless something dramatic happens in the world economies.”

According to CB Richard Ellis, Singapore had a very active hotel investment market this year, clocking in US$1 billion to date in transaction volumes.

This will be good news for property investment firm MGPA, the developer behind the upcoming Westin at Asia Square.

Chuck Abbott, Regional Vice President (Southeast Asia) with Starwood Hotels & Resorts, said: “Westin is a very well known international brand, so I think the advantage is people are familiar with the name.

“Although globally there is a slowdown, in Asia, it’s actually quite robust. We still see growth year over year across most of our markets and Singapore [is one of them]. The hotel business is doing quite well in Singapore and we expect this to continue into the future.”

In any case, the prime location of the new hotel should be a buffer against any slowdown.

Mr McIntosh said: “Marina Bay is a classic example… the whole development of that as a precinct with the new office buildings, new residentials, all help attract new business, particularly corporate business. It also gives the leisure visitors something else to do when they’re here.”

Experts said the hospitality industry in Singapore will continue to see robust growth and with hotel room rates expected to increase 17 per cent by the end of this year, they said more industry players are likely to be vying for a slice of the profit pie in 2012.

Source : Channel NewsAsia – 17 Oct 2011

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