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The consensus at the HotelInvestment Conference AsiaPacific (HICAP) in October2011 was that “Asia is whereit’s at.” The key discussionsall highlighting the fact thatmost significant hotel growtharound the world is planned

for APAC. The conference in Hong Kong, attend-ed by the industry’s movers and shakers clearlyhighlighted Asia as their key growth market.

Over the next few years, hotel development inAsia-Pacific will comprise 1,373 hotels withmore than 335,000 rooms, more supply thanplanned in Europe, Middle East and Africa com-bined. These promising plans indicate 77% ofhotel development is scheduled for Asia, clearlywell ahead of any other region worldwide.

Hotel investment worldwide is clearly reboundingafter the deep slump, consequent on the GreatRecession of 2008-2009, with US$14.8 billion hav-ing been invested in the second quarter of 2011.This represented an increase of 117% over the sameperiod in 2010, driven by investment of US$7.4 bil-lion in the Americas, a growth of 187%.

Asia-Pacific, where hotel investment had faredbetter in the recession, went up by 59% withstrong activity, particularly in Singapore, China,Japan and Hong Kong.

Statistics clearly indicate the reason for opti-mism. Asia Pacific’s RevPAR growth stands at aphenomenal 23.0%, far outperforming all otherregions around the world. With a region-wide

aggregate RevPAR of just over US$86, AsiaPacific comes out ahead of both Europe and theAmericas in absolute performance.

World Tourism Organization reports show thatin April 2011, international visitor arrivals toAsia-Pacific increased by 6.8% and for the firstfour months by 5.4%, ahead of 4.5% for totalinternational tourist arrivals. The best perform-ers in the region included Hong Kong up 20%;Vietnam, 22%; Singapore, 17%; Cambodia,11%; and Australia, up 8%.

Asian hotel expansion is earmarked for theworld’s fastest-growing economies: China andIndia. 1,248 hotel projects are slated for China,representing 35% of the world’s total hotel proj-ects (and 44% of all rooms under constructionglobally). India boasts the 2nd-fastest-growingAsian pipeline, with 450-plus projects and near-ly 80,000 rooms under construction.

Among the region’s markets, New Delhi has comein with the largest expected growth (+46.3%) if all10,477 rooms in the total active pipeline open.

Bill Healey

INTERNATIONAL

ASIA HOTEL FORECAST

Among the region’s markets, New Delhi has come in with the largest expected growth (+46.3%) if all10,477 rooms in the total active pipeline open. Other markets to report a significant growth in existingsupply: Manila, Philippines (+30.0% with 5,523 rooms); Mumbai, India (+22.5% with 4,185 rooms);

Bali, Indonesia (+19.3% with 6,257 rooms); and Jakarta, Indonesia (+17.3% with 4,541 rooms).

HOTEL

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ASIA HOTEL FORECAST

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Other markets to report a significant growth in existing supply: Manila,Philippines (+30.0% with 5,523 rooms); Mumbai, India (+22.5% with 4,185rooms); Bali, Indonesia (+19.3% with 6,257 rooms); and Jakarta, Indonesia(+17.3% with 4,541 rooms).

A clear indication of the focus on this regional market is Starwood Hotels &Resort’s announcement that it has surpassed the 200th hotel milestone with aflurry of recent openings in China, India, Thailand, and Malaysia. Starwood con-tinues to widen its lead as the largest operator of four- and five-star hotels in Asia-Pacific with plans to reach more than 320 hotels by 2014.

“The opening of our 200th hotel in Asia Pacific underscores the vitality ofthis market and its importance to our future growth,” Frits van Paasschen,Starwood’s president and CEO, said in a statement. “Demand for our high-caliber brands continues to soar across Asia’s many dynamic markets, drivenby phenomenal economic growth and significant increases in outbound trav-el, particularly from China and India.”

Similarly, France's Accor has planed to open more than 200 new properties in Asiawithin three years as it looks to leverage the region's increasing affluence.

Accor, which owns 4,200 hotels worldwide -- including 450 Ibis, Novotel,All Seasons, Sofitel, Pullman and Mercure resorts in Asia-Pacific -- said itwould target China, India and Indonesia as its chief markets for growth.

With the markets in Europe and the United States struggling with pooreconomies and debt crises, Accor mentions Asia would overtake the West asits biggest growth area. They announced that 42% of the 100,000 newrooms it is planning to add around the world will be in Asia.

Accor currently has 110 hotels in China, and plans to open 55 more by 2014.Though they have only nine properties in India, they plan to open 63 more withinthree years. In Indonesia Accor will open 34 more, adding to the 43 it already has.

A key indicator often cited by leading hotel groups is the massive scale ofnew orders for aircraft from airlines in the region. In recent months AirAsia,Malaysia's low-cost carrier, has placed huge orders with Airbus Industrie for200 of its A320 jets. India's IndiGo had earlier confirmed an order of 180of the same plane. Additionally, several Chinese airlines have also signedsignificant deals for hundreds of the same Airbus A320 model.

This significant up-swing of budget air travel has added to the significantgrowth of 2-3 star budget hotels throughout the region. As the growingnumber of travelers travel on low-cost airlines, they’ll be looking to pair thatwith budget accommodations. Accor is one of several global groups boost-ing the presence of their budget hotel brands to meet this growing demand.

The growing affluence of Asian economies and their growing demand fortravel have lead most international hotel groups into an increased presencein the Asia Pacific region.

Further information on the HICAP Conference can be found at: www.hicap-conference.com" www.hicapconference.com

Based in Bali, Bill has been consulting, installing and supporting solu-tions in the global golf and leisure industry since 1982. He has beeninvolved with over 1000 systems installations in 40+ countries fromNorth America to Africa to Asia & Australia.

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