Hotel chains eye further growth in region

Artist's impression of the InterContinental Singapore at Robertson Quay, due to open next year.
Artist's impression of the InterContinental Singapore at Robertson Quay, due to open next year.PHOTO: INTERCONTINENTAL HOTELS GROUP

Optimistic outlook due to regional tourism boom, relatively positive economic growth

There's plenty of gloom around the economy these days but try telling that to the hotel industry.

Expansion and optimism are the watchwords as far as the hospitality sector goes, with operators devising ambitious plans for growth across the region.

Pan Pacific Hotels Group (PPHG), InterContinental Hotels Group (IHG) and the Carlson Rezidor Hotel Group have all opened new hotels this year, with more to come, thanks to a regional tourism boom and relatively positive economic growth.

PPHG, a subsidiary of Singapore-listed UOL Group, opened the 329-room Pan Pacific Hanoi in Vietnam last month, with six other properties mostly across the region due to open over the next three years.

One will be a 223-room PanPacific Hotel opening in Beijing by May and another in Yangon, Myanmar, with 348 rooms that will be ready in the latter part of next year.

"In Asia, the long-term outlook is optimistic because the tourism sector is projected to grow at a phenomenal rate of 30 to 50 per cent faster than national GDP," said PPHG chief executive Bernold Schroeder.

The group, which also owns the Park Royal Hotels & Resorts brand, has 39 properties, including those under development, with 29 in Asia. Its other projects in the pipeline in 2018 are a 205-room Pan Pacific Serviced Suites in Johor and a 347-room Park Royal Langkawi Resort - both in Malaysia. In 2019, it will be opening Pan Pacific London and Park Royal Melbourne.

Mr Schroeder added: "We want to be anywhere between Beijing and Sydney, maybe Auckland one day. We want to be Asia-centric... We will cover the first-tier cities with the Pan Pacific Hotel, maybe second-tier cities with Park Royal Hotel and have some serviced apartments."

PPHG has eight hotels and serviced suites with more than 2,500 rooms here and the firm is upbeat about business despite the large incoming supply of new rooms onto the market next year. Mr Schroeder noted hotels in Singapore are still running at a healthy average occupancy of 80 per cent and the country has a diverse mix of attractions to keep visitors coming.

PPHG's hotel operations contributed a revenue of $419.4 million - or about 33 per cent of UOL's total turnover - in the 2015 financial year.

IHG is also confident about Singapore's potential to draw visitors, owing to a myriad of events and attractions and the country's position as a major air hub.

It has been busy expanding here this year, with two new hotels in Katong - 131-room Hotel Indigo and 451-room Holiday Inn Express. It has also ramped up capacity at the Crowne Plaza Changi Airport with a 240-room extension.

IHG, which owns brands such as the InterContinental Hotels & Resorts, Holiday Inn, Hotel Indigo and Crowne Plaza, said it will almost double its presence in South-east Asia with 60 new hotels and resorts over the next few years.

The expansion will take IHG into a new market early next year.

"We'll be opening a 198-room Crowne Plaza Hotel in Vientiane... With tourism on the rise in Laos, it's a great time to be entering the country," said Ms Leanne Harwood, vice-president for IHG operations in South-east Asia and Korea.

Other new projects opening next year include the 225-room InterContinental Singapore at Robertson Quay, Hotel Indigo Bali Seminyak, Crowne Plaza Phu Quoc in Vietnam and Holiday Inn Express Krabi in Thailand.

Carlson Rezidor Hotel Group, which operates 107 hotels in the Asia-Pacific, including brands like Radisson, has 88 new hotels in the pipeline.

Mr Andre de Jong, vice-president for operations in South-east Asia and Pacific, told The Straits Times that business has been good despite sluggish global growth. "The group has seen remarkable success in the Asia-Pacific region with system-wide revenue increasing significantly over a five-year period," he said.

The firm recently opened Radisson Golf & Convention Centre Batam in Indonesia, Radisson Blu Resort Hua Hin in Thailand and Park Inn by Radisson in Libo county in China.

Mr de Jong said China, Australasia and key gateway cities such as Singapore and Kuala Lumpur have been identified as future growth markets for the group.

A version of this article appeared in the print edition of The Straits Times on November 04, 2016, with the headline 'Hotel chains eye further growth in region'. Print Edition | Subscribe