HOTEL room rates in key Asean cities are expected to rise by a modest 2 per cent in 2020, according to the latest Hotel Monitor report by American Express Global Business Travel, released July 26.
The report looks at hotel rates across 46 key business cities, including Bangkok, Ho Chi Minh City, Kuala Lumpur, and Singapore.
It predicts room rate rises of 2 per cent in each of those four Asean cities, comparable or better than some other Asia-Pacific cities such as Beijing (1 per cent), Melbourne (2 per cent), and Sydney (5 per cent), but behind Tokyo (4 per cent) and Hong Kong (3 per cent).
Notably, Asia-Pacific's rise in rates comes despite rapid growth in the number of rooms, with thousands of beds added in key cities each year. "Even with the added capacity, sustained demand in these growth economies means rates are likely to see some rises," said the report.
Despite the uncertain political situation after its general election in early 2019, Thailand expects to receive a record 41.1 million visitors in 2019, up 8 per cent year on year. The government has reduced taxes on hotel stays and given more permits for new hotels, with the Greater Bangkok region as one key area for hotel development.
Ho Chi Minh City
Vietnam has seen an increase in foreign management companies and international hotel brands in recent years. A limited construction pipeline means that Ho Chi Minh City is expected to maintain solid occupancy levels and room rates in 2020.
After five years of sustained hotel development, supply growth in the Malaysian capital has outpaced demand. The current construction pipeline of 25 hotels, representing 6,900 rooms, will put more pressure on certain areas of the city, with half the new hotels in the upper-upscale and luxury hotel classes.
While developments such as the expansion of Changi Airport and investments at Resorts World Sentosa are expected to increase tourism and MICE (meetings, incentives, conferences and exhibitions) business, room rates are expected to rise merely in line with inflation at 2 per cent.