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Featured in this Asia Pacific Hospitality Newsletter - Week Ending 24 October 2008
Indian Hospitality Business Impacted By Global Economic Slowdown
Dubai’s Jumeirah Group To Open 60 Hotels by 2012
Occupancies In Hong Kong’s Hotels To Drop In Fourth Quarter Of 2008
Carlson Hotels Affected By Tourism Slowdown
Park Hotel Clarke Quay To Open In March 2009
Sri Lanka’s Kosgoda Beach Resort To Be Repositioned
Absolute Share Price Performance, As At 24 October 2008
Indian Hospitality Business Impacted By Global Economic Slowdown Return to Headlines
The global economic slowdown has impacted the hospitality business in India, especially the star-rated hotels, as occupancies decline and food and beverage sales drop. According to market sources, average occupancy rates across the hospitality industry have declined by 10% since May 2008 as a result of the United States subprime crisis that began in September 2007 and rising domestic terrorism. During the off-peak period from May to October 2008, hotels registered an average occupancy of 70%, compared to 75% during the same period in 2007. In addition, foreign tourists to India, who typically make up 70% to 80% of an Indian hotel’s revenues, in 2008 are expected to decrease due to the bombing incidents in several Indian cities. Currently, most hotels are inclined to offer corporate discounts as high as 40% to 50% to attract guests. Food and beverage revenues have also declined due to lower room occupancies and lesser number of walk-in guests.
Dubai’s Jumeirah Group To Open 60 Hotels by 2012 Return to Headlines
Dubai’s government-owned luxury hotel operator, Jumeirah Group, has announced that it will move forward with its global expansion plan which is expected to open 60 hotels by 2012, despite the global financial crisis. Since the beginning of October 2008, the group has signed management agreements for five new hotels, namely Jumeirah Bali Resort in Indonesia, Jumeirah Maldives Resort in the South Malé Atoll, Jumeirah Al Salam Resort in Bahrain, Jumeirah Al Salam Yiti Resort in Oman and Jumeirah Messilah Beach Hotel in Kuwait, which are scheduled to open by 2011. Currently, the group manages 11 hotels and resorts, and 19 properties are under construction.
Occupancies In Hong Kong’s Hotels To Drop In Fourth Quarter Of 2008 Return to Headlines
The Federation of Hong Kong Hotel Owners has estimated hotels’ occupancy rates to witness a year-on-year decline of around five percentage points in the fourth quarter of 2008 as business visitors from the United States and Europe decline and meetings, incentives, conventions and exhibitions (MICE) travellers are expected to drop as well. However, hotels are expected to achieve an overall occupancy rate of approximately 84% to 85%, close to last year’s, as visitor arrivals were strong in the first three quarters of 2008.
Carlson Hotels Affected By Tourism Slowdown Return to Headlines
Carlson Hotels Worldwide (Carlson), which is scheduled to add 12,000 rooms in Asia Pacific, is expected to face a postponement in 15% of these planned additions while a further 30% of these rooms may not materialise due to liquidity problems. However, the slowdown in supply is likely to result in reduced competition and hence, the outlook may not turn out as bleak. Moreover, Carlson has added that domestic tourism in China and India are likely to soften the impact of the decline in international travel for their hotels.
Park Hotel Clarke Quay To Open In March 2009 Return to Headlines
The 336-key Park Hotel Clarke Quay is scheduled to open in Singapore by March 2009. With a total development cost of between approximately US$85 million and US$100 million, the hotel will be Singapore-based Park Hotel Group’s third in Singapore after Park Hotel Orchard and Grand Plaza Park Hotel City Hall. The group also announced the acquisition of its third hotel in Xi’an, China and its first in Japan. The group plans to acquire another ten to 12 more hotels within the next few years, mainly in the Asia Pacific region.
Sri Lanka’s Kosgoda Beach Resort To Be Repositioned Return to Headlines
Sri Lanka’s Kosgoda Beach Resort is set to undergo a US$95,000 refurbishment to be repositioned as a luxury boutique resort after it was recently rebuilt for US$1.6 million. Built in 1984 and featuring 54 rooms, the hotel is expected to add a water sports centre in addition to a room and a pool butler service. The management is targeting high-end luxury travellers and expecting a 25% increase in revenue after the additions.
Absolute Share Price Performance, as at 24 October 2008
Closing Share Price as at October 24 2008 October 17 2008 % Change
Australia Stock Exchange (ASX)
Amalgamated Holdings 4.20 4.25 -1%
General Property Group 1.15 1.09 6%
Mirvac Group 1.64 2.06 -20%
Ocean Capital Limited 0.40 0.35 14%
Thakral Holdings Group 0.64 0.72 -11%
Living and Leisure Australia Group 0.02 0.03 -8%
Bangkok Stock Exchange (THB)
Central Plaza Hotel Public Co Ltd 3.98 4.14 -4%
Dusit Thani Public Co Ltd 18.90 20.00 -6%
The Erawan Group Public Limited 1.90 2.12 -10%
Grande Asset Development 2.00 2.20 -9%
Laguna Resorts & Hotel Public Co Ltd 24.00 23.60 2%
Minor International PCL 7.60 7.45 2%
Hong Kong Stock Exchange (HK$)
Miramar Hotel International Ltd 5.06 6.65 -24%
Regal Hotels International Holdings Ltd 1.62 1.80 -10%
Sino Hotels Holdings Ltd 3.20 3.20
The Hong Kong & Shanghai Hotels Ltd 6.12 6.55 -7%
Singapore Stock Exchange (S$)
Amara Holdings Ltd 0.17 0.19 -11%
ART Management Pte Ltd 0.47 0.44 6%
Banyan Tree Holdings Limited 0.53 0.58 -9%
CDL HTrust 0.64 0.70 -8%
Hotel Grand Central Ltd 0.48 0.50 -4%
Hotel Plaza Ltd 1.23 1.22 1%
Hotel Properties Ltd 0.94 1.02 -8%
Mandarin Oriental International Ltd (US$) 1.10 1.00 10%
Shangri-La Asia Ltd 8.00 8.00
Stamford Land 0.22 0.28 -100%
Return to Headlines
HVS Beijing
David Ling
HVS Hong Kong
Mark Keith & David Ling
HVS Mumbai
Manav Thadani
HVS New Delhi
Manav Thadani
HVS Shanghai
David Ling
HVS Singapore
David Ling
Disclaimer: Information provided above has been gathered from various market sources. HVS has not independently verified the accuracy of the information provided. Interested parties should not rely on the information as statement of facts and are advised to make their own independent checks to verify the information provided. For further information, please feel free to contact HVS Singapore.
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