Singapore’s hotel performance splutters

LONDON Singapore enjoys strong supply growth in its hotel sector and low occupancy levels according to STR’s preliminary December 2016 data released last week.

Based on daily data from December, Singapore reported that supply increased 4% mostly in midscale properties based on year-over-year comparisons:

Demand increased by 2.1%, while occupancy fell by 2.0% to 77.2%, in year-over-year comparisons

Average daily rate (ADR) also declined 2.7% to SGD281.70, while revenue per available room (RevPAR) declined 4.7% to SGD217.44

The December performance clocked Singapore’s second-lowest actual occupancy level of the year behind June 2016 (76.5%), and the lowest absolute occupancy for a December since 2009 (77.1%).

STR analysts noted that the country’s hotels continue to struggle with fewer major events driving tourism and a consistent imbalance in supply and demand growth.

Additionally, an increase in the number of rooms in the upper midscale class has altered the market landscape with more rooms available at lower prices. December marked Singapore’s 10th consecutive month of year-over-year ADR declines.

STR will release actual December 2016 results later this month.