Rates Down, Occupancy Up for Singapore Hotels in June

STR preliminary data shows Singapore hotels reported mixed performance in June. Occupancy rose 4.1% to 78.9%, ADR declined 2.5% to 258.03 Singapore dollars ($187.07) and RevPAR increased 1.5% to SG$203.62 ($147.60). The situation is unlikely to change as 10% more rooms than in 2016 are to be added until year-end.

 STR preliminary June 2017 data for Singapore indicates higher occupancy levels and lower rates. Based on daily data from June, Singapore reported the following in year-over-year comparisons:
  • Supply: +2.3%
  • Demand: +6.5%
  • Occupancy: +4.1% to 78.9%
  • Average daily rate (ADR): -2.5% to SGD258.03
  • Revenue per available room (RevPAR): +1.5% to SGD203.62

The absolute ADR and RevPAR levels would be the lowest for a June in Singapore since 2010. The country has posted year-over-year declines in ADR each month since February 2016, which STR analysts attribute to growing hotel supply and economic challenges. The June performance for ADR and RevPar are the lowest to date for Singapore hotels since 2010.

STR analysts also note that Singapore’s strong demand for the month was likely boosted by an 11-day calendar shift in Ramadan. With an earlier Eid Mubarak, the usual influx in foreign visitors from key tourism source markets like Indonesia occurred in June as opposed to July. STR will release actual June 2017 results later this month.

According to data from the Singapore Tourism Board, gazetted hotel room revenue for 2016 was estimated at S$3.2 billion, a 1.8 per cent growth over the same period last year. In 2016, Average Occupancy Rate (AOR) fell 0.9 percentage points to reach 84 per cent while Average Daily Rate (ADR) already fell 3.9 per cent to S$236. Revenue per Available Room (RevPAR) fell by 4.7 per cent to S$199, mainly due to a lower ADR.

The Singapore Tourism Board recorded 413 hotels in 2016 (including hostels with more than four rooms) representing a growth of 3.77% growth over 2015 and 63,850 rooms (+4.83%). According to Singapore Urban Redevelopment Authority (URA), they are 6,778 rooms in the pipeline including 6,013 rooms in construction at the end of the first quarter 2017. This would represent a growth of almost 9.5% compared to 2016 rooms supply.

(Source: STR)