Consulting cabinet HVS Global Hospitality Services remains optimistic about Malaysia hotels perspective in the short/medium term. Although total foreign arrivals are likely to decline in 2015, the declining ringgit value and a weaker economy will stimulate both international and domestic tourism.
Amidst the relative instability in the overall economic and political situation in the short term, recovery is expected to brighten in the mid/long term as the country’s structures remain sound. Thanks to the declining value of the Ringgit -20% since the beginning of the year- international travellers might find that visiting Malaysia is more affordable than ever.
HVS believes that the potential to diversify the tourism product will attract new travellers. Medical tourism but also themed travel packages such as heritage and culture, adventure and ecotourism, luxury and shopping as well as wellness/spa and medical tourism.
HVS sees the emergence of new resort destinations as nature remains a major tourism asset or Malaysia. Ecotourism and sustainability rising awareness among travellers will likely stimulate future travel to Sabah and Sarawak, in Malaysian Borneo. Leisure attractions development with amusementpark additions such as the 20th Century Fox World Genting and Movie Animation Park Studios Perak (both expected to open in 2016) will be attractive destinations for both domestic and regional travellers. HVS sees also health, medical and wellness tourism growing strongly as Malaysia will be more competitive than Thailand or Singapore. MICE are also a growing business for the country.
According to HVS, Malaysia had a total of 4,072 hotels offering 262,021 rooms. CAGR (Compoud Annual Growth Rate) grew by 14.5% between 2010 and 2014 in terms of hotels and 11.7% in terms of rooms. However, only 22.7% of the hotel supply belongs to international brands, highlighting the potential for more hotel brands to move into the market. The average occupancy rate is in a range of 55-60% with Kuala Lumpur and Pahang showing the highest occupancy. Over the next three years, 10,000 rooms will be added including luxury brands such as Banyan Tree, Four Seasons, Harrods or St Regis. They will put further pressure on room rates in the luxury category.