Hotels With F1 View Mull Room Pricing

Source : The Business Times, August 14, 2007

Levy announced, but price delay frustrates corporate customers

SINGAPORE) Hotels are still working out how to price their rooms for next year's Formula One motor racing carnival - after the Ministry of Trade and Industry (MTI) yesterday announced its levy plans.


















There will be a 30 per cent levy on rooms and room packages at trackside hotels and 20 per cent at all other tourist hotels.

The levy will be charged for five nights - from Sept 24 to 28 next year. And the trackside hotels affected will be Swissotel The Stamford, Raffles The Plaza, Pan Pacific, The Fullerton, Ritz Carlton Millenia, The Oriental, Marina Mandarin, Raffles Hotel, Conrad Centennial, Carlton Hotel and Peninsula-Excelsior.

The list will be revised if necessary when the F1 circuit design is finalised with motorsports authorities.

Money raised from the levy will offset the government's expenses in helping stage the race.

Right now, no hotel seems to want to be the leader in setting room rates - which is making end-users like the local offices of car sponsors frustrated because they cannot confirm their plans for the race.

'Everybody has to find their feet because it's a new thing,' said BMW Asia's corporate affairs regional manager Michael Lim. 'But we have to do our budgets for next year and the time has already come that we have to set down some numbers.'

One thing is certain: room rates at trackside hotels are going to be supercharged. Their everyday tariffs already range from about $250 to $700. And during the race period, these are set to double - or even triple - if they follow Monaco's example.

But most hotels seem to be in no hurry to put the actual figures on the table.

'Rates will only be finalised when more event details are disclosed. The race concept - night or day - will factor into the demand to view the race,' said Pan Pacific's public relations manager Cheryl Ng.

Because rates have not been set, the hotel is keeping a waiting list of guests who have inquired about rooms during the race period, she said.

At the Oriental, director of communications Ruth Soh said: 'As the announcement of the F1 dates and 30 per cent levy have only just been made, we are still in the midst of creating the rates and packages for the F1 period.'

At the Marina Mandarin, a spokesman declined to comment except to say the hotel was awaiting further news from the Singapore Hotel Association.

Other trackside hotels The Business Times spoke to like The Raffles and Ritz Carlton, also had no comment, saying they need more time to assess the impact of the levy.

But at Swissotel The Stamford, general manager Aiden McAuley hinted at rates soon.

'With the finalisation of this levy by MTI, we will be finalising our room packages for the F1 period and will release them shortly,' he said.

To find the right price points, hoteliers are checking out what their peers charge at other Formula One venues.

Pan-Pacific's Ms Ng said: 'We are conducting global market research regarding acceptable rates for hotel rooms in significant F1 cities.'

Hotels in cities like Monaco and Melbourne reportedly charge two to three times as much during race week. But BMW's Mr Lim suggested it may be unrealistic to set rates comparable to Monaco. Kuala Lumpur may be a better comparison, he said.