Hotel rooms galore this year

Well-heeled as well as budget travellers will be spoilt for room options when they visit Singapore this year.

Big players like Marina Bay Sands, Resorts World Sentosa and The Fullerton Heritage are rolling out top-end hotels.

Together, they alone will inject more than 4,000 rooms to the existing 44,000 in all classes of hotels.

But the majority of Singapore’s visitors – the biggest numbers being from China, Indonesia and Malaysia – will not be left out in the cold either, with more new mid-tier and budget hotels opening.

Tourism is expected to bounce back this year after the industry was hit by the global slump last year.

November’s visitor tally was up 8.4 per cent from a year earlier, to reach 830,000.

Singapore had targeted nine million to 9.5 million visitors for last year.

Given the new supply of rooms, industry players do not expect a repeat of the severe room crunch that plagued the previous tourism peak in 2008. Then, many tour groups had to be diverted to hotels in Geylang and even chalets in the east.

‘Those days, the numbers kept increasing but room numbers were stagnant. This round, we’re seeing new properties,’ said Mr Robert Khoo, chief executive of the National Association of Travel Agents Singapore.

He noted that while affordable hotels have opened, they cannot match the boost in rooms from five-star hotels.

‘Singapore is land-scarce. A hotel developer, if given a choice, will definitely want to develop a high-end property which will fetch higher and faster returns,’ he said.

One new five-star player is The Fullerton Bay Hotel. Slated to open in the second quarter, the 100-room hotel boasts a waterfront location and a grand entrance through the foyer of the historic Clifford Pier.

The substantial overall rise in room numbers means that rates will continue to be under pressure, said Ms Chua Chor Hoon, head of South-east Asia research for property consultancy DTZ Debenham Tie Leung.

The average room rate for November last year was about $198.

The average hotel occupancy rate has been holding steady at around 70 per cent to 80 per cent. Last November, it hit 84.3 per cent, a 3.8 percentage point increase over November 2008.

During the 2008 peak, it was in the 80 per cent to 90 per cent range.

With competition in the top tier heating up, travel agents said some hotels in this segment have indicated that they will lower room rates by 20 per cent to 30 per cent.

Ms Karen Tan, executive assistant manager for revenue and marketing at Swissotel The Stamford and Fairmont Singapore, said room rates ‘will be competitive’.

Said Marina Mandarin Singapore’s general manager, Mr Richard L. Dusome, of the competition from Marina Bay Sands: ‘We will keep a close watch on their pricing strategies to ensure we are competitive.’

The integrated resort’s three hotel towers will offer more than 2,500 rooms.

While most visitors are mid-range types, travel agents said the five-star hotels will have their following.

They include high-end travellers who are likely to turn their attention from Macau to Singapore when the integrated resorts open.

Singaporeans looking for ‘an alternative staycation’ are also expected to check into the integrated resorts, said Ms Jane Chang, assistant manager of marketing communications at Chan Brothers Travel.

Source: Sunday Times, 3 Jan 2010