Key insights on the Asia Pacific hotel industry
APAC insights from STR's Global Hotel Study
The world's most populous region saw strong growth in travel and tourism in 2017 - stronger than expected, in some cases. This has had a profound effect on the hospitality sector, and only a handful of APAC countries saw performance declines in comparison with 2016.
After conducting the most extensive research report STR has ever published, we're pleased to share some interesting findings on the APAC market from our Global Hotel Study: 2017.
Some insights from the APAC Edition:
- A rising middle class, both in developing and industrialized nations, continues to drive new developments across domestic and overseas locations to offer improved and increased accessibility. This not only includes expanding airlift, airports, train stations, roads, etc., but also implementing visa de-regulations and increasing the visibility and perceptions of destinations through marketing campaigns.
- Vietnam, which has seen some of the fastest-growing international arrivals, has seen continued hotel performance growth, with RevPAR up 13.7% in 2017. There is a strong pipeline across the country - how will this impact growth levels over the next few years?
- The Maldives continues to be an attractive hotel development market as well as tourism destination. After a few years of declines, performance came back in 2017, although rates have not caught up to their 2013 levels yet. This will be an interesting market to watch through the rest of 2018 and into 2019, as new supply enters the market, along with continued enhancement of the airport in Male and a general election scheduled to start this September.
- Australia and New Zealand continue to benefit enormously from growth in international arrivals. China has been the predominant driver of this growth, but we're also seeing substantial increases from traditional western markets like the U.S., U.K., and several other European nations. This has sparked renewed development interest, and various locations are in different sages of their new hotel supply investment, with varying impacts on performance. Brisbane and Perth have incentivized development, but demand growth has not kept pace. Meanwhile, markets like Auckland and Sydney, which both rebounded quite well after the Global Financial Crisis, have not seen any significant hotel supply growth over the past 15 years.
- Tokyo hotels recorded a 12% growth in the number of nights of the year where occupancy eclipsed 90% in 2017, indicating opportunity for further ADR growth. Japan saw a 20% increase in foreign visitors in 2017, at 28.7 million, tripling its number of international arrivals over the course of five years, according to the Japanese government.
- China's hotel industry saw strong RevPAR growth in 2017, up 5.6% over 2016. Supply (+3.7%) came in at the slowest rate of the past decade. China's second-tier cities are seeing higher rates of inventory growth than the first-tier cities. This has brought both opportunities and challenges for markets like Xi’an, Hangzhou, Tianjin, Wuhan and Dalian, which have seen rate declines over the past few years. Thanks to a boom in leisure domestic travel, these markets saw growth in both occupancy and rates.
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About the Global Hotel Study
With detailed insights for more than 100 global markets, STR’s Global Hotel Study explores the highs, the lows, and the factors tipping the scale in each direction for hotel markets around the world. This is your definitive road map for setting strategies for the year ahead and beyond.
The full 110-page version of the report, covering all five world regions, is available at a discounted price.
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