Singapore’s hotel market remains buoyant


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CBRE Asia Pacific Hotels & Hospitality’s Market Update series explores key trends in the region across indicators such as tourism arrivals, hotels performance, supply and investment activity, as well as notable market developments that are relevant to the hotel sector.

Following a strong 2023, Singapore’s hotel market has been buoyant since the turn of the new year, boosted by a bustling events scene and the return of mainland Chinese tourists.

Hotel performance has been robust, driven by a steady flow of international arrivals and a packed calendar of events. Thanks partly to the country’s hosting of six Taylor Swift concerts, the hotel industry posted its highest ever Average Daily Rate (ADR) and Revenue Per Available Room (RevPAR) for the month of March.

While occupancy remains slightly down relative to 2019, Singapore registered the highest occupancy levels in Asia Pacific as of April 2024 year-to-date. Occupancy surpassed 83.8% in March, slightly below the 84.3% observed during the same month in 2019.

Despite a significant improvement in operational performance over the past 12 months, investment activity still lags historical levels. However, expectations are that borrowing costs will begin to decline at the end of Q3 2023 or the start of Q4 2024 in tandem with interest rate cuts in the U.S., which should spur an increase in investment activity.

Private investors will continue to drive acquisitions in 2024, with luxury and upscale assets their primary focus. Investors will also look to enter the nascent co-living market, which offers prospects for growth amid the significant shortfall in residential completions over the past five years.

 

 





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