Call For More Hotel Rooms Amid Crunch

Source : The Business Times, October 3, 2007

WITH hotels filling up and guests having to pay more for their accommodation, there is 'a call for more hotel rooms' in Singapore, says a consultant. There are already 15 more hotels planned or under construction, which should help, he says.

In an interview with BT, Patrick Ford, who is president of Lodging Econometrics, an international consultancy based in the United States, said that the HotelBenchmark Survey by accountancy firm Deloitte & Touche shows that Singapore had the third highest occupancy rates in the Pacific Rim at 81.5 per cent, last year. Hong Kong was first and Melbourne second.

The half-year results for the Deloitte report puts occupancy rates for the first half of 2007 at 82.9 per cent for Singapore, a 5.3 per cent increase over the corresponding period for last year. Deloitte reported average room rates for Singapore to be about US$160, a 22.4 per cent growth from the previous year.

Revenue per available room was strong and 'driven up by average room rates' Deloitte said, to US$132, a 28.9 per cent rise. The strength of these figures puts Singapore ahead of other Asia Pacific markets such as Hanoi, Mumbai, Manila, Shanghai, Bangkok and Bali.

According to data from Lodging Econometrics, Singapore currently has 15 hotel projects in the pipeline - which have been formally announced in the public domain or are being actively pursued - to provide the hotel industry with more than 6,400 rooms over the next few years.

Of the 15, five are currently under construction, two are expected to start in 12 months and eight are in various stages of early planning. The 15 hotels are expected to be completed between 2007 and 2010. Two of the 15 hotels will open their doors this year - the St Regis, Singapore, being one of them.

Mr Ford said the upcoming integrated resorts, coupled with Singapore being a popular choice as a MICE destination, keeps the city as a top international market and tourist destination as well as being on the booking rotation for conferences and conventions.

'It puts Singapore on the map as a hot destination for different reasons and different markets,' Mr Ford said.

Propelled by the flourishing property market, future hotel developments may have to be luxury or high-end ones, so as to reap the highest possible room rates and offset the costs of development and land, Mr Ford told BT. While there will still be a demand for mid-market hotel properties, they may be pushed outside of desirable locations.