Asia Pacific Hospitality and Hospitality Market Continues to Grow as Travel Demand Returns

According to the latest research from CBRE, confidence in the Asia-Pacific hospitality and hospitality market continues to grow as borders reopen, investment appetite grows and operating performance approaches record levels. pre-pandemic levels.

The recovery is largely driven by domestic travel demand, particularly in North Asia and Pacific markets, with overall Asia-Pacific tourist arrivals expected to reach pre-pandemic levels by 2024. While international arrivals to the region continue to increase, they remain well below pre-pandemic levels. Markets that have loosened restrictions on vaccinated travelers more quickly (Australia, Singapore, India, Thailand) are seeing a much more pronounced return of tourists than those that maintain strict entry or testing policies (Korea, Indonesia) or impose entry quarantine periods (Japan, Mainland China, Hong Kong SAR, Taiwan).

“As borders reopen, confidence is returning to the Asia-Pacific hospitality sector, confirming that when people can travel, they will travel. Reopening in the region has been fragmented, with uncertainty surrounding the opening of borders from mainland China, Hong Kong SAR and Japan weighing somewhat on tourism sentiment in the region,” said Henry Chin, Global Head of Investor Thought Leadership and Head of Research, Asia Pacific .

Average daily rate (ADR), occupancy and revenue per available room (RevPAR) are trending upwards across all Asia-Pacific markets, with regional recovery to pre-pandemic levels expected by 2024 With the supply pipeline remaining limited in most Asia-Pacific markets, the risk of new hotels saturating the market is low, putting less pressure on room prices and revenues. Operating expenses increased significantly across all revenue streams, especially for labor costs and utilities.

Asia-Pacific hotel investment reached $10.1 billion year-to-date in August 2022, a 17% year-over-year increase. Cross-border capital flows to Asia-Pacific hotel assets have reached $932 million since the start of 2021, driven mainly by institutional investors. Investments were spread across a range of Asia-Pacific markets, with Korea accounting for the largest share with US$2.8 billion in the first half of the year, followed by mainland China, Australia, from Japan and Singapore.

β€œIn a changing economic climate, the daily price structure and flexibility of rate changes means that hotels can provide a hedge against inflation. Easing border controls, rising tourism sentiment and strong investor capital reserves support the increased appetite for operational real estate, with well-located, high-quality hotel assets in key high-demand markets,” said hotel manager Steve Carroll. & Hospitality, Capital Markets, Asia-Pacific for CBRE.

About CBRE Group, Inc.

CBRE Group, Inc. (NYSE: CBRE), a Fortune 500 and S&P 500 company headquartered in Dallas, is the world’s largest commercial real estate investment and services company (based on 2021 revenue ). The company has more than 105,000 employees (excluding Turner & Townsend employees) serving customers in more than 100 countries. CBRE serves a diverse range of clients with an integrated suite of services, including facilities, transaction and project management; property management; investment management; assessment and evaluation; real estate leasing; strategic advice; real estate sales; mortgage services and development services. Please visit our website at www.cbre.com.

Leave a Reply