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The consensus at the Hotel Investment Conference Asia Pacific (HICAP) in October 2011 was that “Asia is where it’s at.” The key discussions all highlighting the fact that most significant hotel growth around the world is planned for APAC. The conference in Hong Kong, attended by the industry’s movers and shakers clearly highlighted Asia as their key growth market.
Over the next few years, hotel development in Asia-Pacific will comprise 1,373 hotels with more than 335,000 rooms, more supply than planned in Europe, Middle East and Africa combined. These promising plans indicate 77% of hotel development is scheduled for Asia, clearly well ahead of any other region worldwide.
Hotel investment worldwide is clearly rebounding after the deep slump, consequent on the Great Recession of 2008-2009, with US$14.8 billion having been invested in the second quarter of 2011. This represented an increase of 117 per cent over the same period in 2010, driven by investment of US$7.4 billion in the Americas, a growth of 187 per cent.
Asia-Pacific, where hotel investment had fared better in the recession, went up by 59 per cent with strong activity, particularly in Singapore, China, Japan and Hong Kong.
Statistics clearly indicate the reason for optimism. Asia Pacific’s RevPAR growth stands at a phenomenal 23.0%, far outperforming all other regions around the world. With a region-wide aggregate RevPAR of just over US$86, Asia Pacific comes out ahead of both Europe and the Americas in absolute performance.
World Tourism Organization reports show that in April 2011, international visitor arrivals to Asia-Pacific increased by 6.8 per cent and for the first four months by 5.4 per cent, ahead of 4.5 per cent for total international tourist arrivals. The best performers in the region included Hong Kong up 20 per cent; Vietnam, 22 per cent; Singapore, 17 per cent; Cambodia, 11 per cent; and Australia, up eight per cent.
Asian hotel expansion is earmarked for the world’s fastest-growing economies: China and India. 1,248 hotel projects are slated for China, representing 35% of the world’s total hotel projects (and 44% of all rooms under construction globally). India boasts the 2nd-fastest-growing Asian pipeline, with 450-plus projects and nearly 80,000 rooms under construction.
Among the region’s markets, New Delhi has comes in with the largest expected growth (+46.3%) if all 10,477 rooms in the total active pipeline open. Other markets to report a significant growth in existing supply: Manila, Philippines (+30.0% with 5,523 rooms); Mumbai, India (+22.5% with 4,185 rooms); Bali, Indonesia (+19.3% with 6,257 rooms); and Jakarta, Indonesia (+17.3% with 4,541 rooms).