Singaporean hoteliers benefited from sustained occupancy levels during the first six months of the year, which helped to boost ADR by 6.6%, according to STR Global.
“Singapore is once more shining as one of Asia’s premier business and leisure hubs, driving hotel revenue-per-available-room performance across the city to new heights,” said Elizabeth Randall Winkle, managing director at STR Global. “Looking forward, we are expecting to see Singapore increasing its room supply by 6.1% by the end of 2013. While occupancies may see some pressure in the short to medium term in some areas, rates in the overall market are likely to continue in an upward trend. As such, our latest forecast indicates that RevPAR growth will continue for the remainder of the year and in 2013, mainly led by ADR growth.”
Singapore recently has been in the spotlight, notably this February when the city hosted the biennial Singapore Airshow, one of the largest air displays in Asia. The event attracted a record number of visitors in 2012, with more than 30% coming from overseas, according to the organizers. This, along with other events, helped boost occupancy to 84% for the first six months of 2012. With more limited supply increases since the opening of Marina Bay Sands in June 2010, Singapore’s hotels increased ADR year to June to S$296.60 (US$235.79) while RevPAR grew by 8.2%.
In the Marina Bay area, RevPAR grew by 13.2% to S$277.46 (US$220.58). The increase was led by ADR, up 8%, growth year to June, while occupancy grew slightly less, up 4.8%. During the six-month period, occupancy peaked in February at 89.3% as a result of additional demand growth, in part from the Airshow. ADR increased year to June by 8.0% to S$321.02 (US$255.21). February 2012 recorded the highest ADR level of S$333.55 (US$333.55) for that month since February 2008.
In the shopping and entertainment area of the Orchard Road, hotels reported RevPAR of S$261.10 (US$207.57), a 1.8% increase that was solely led by ADR growth, up 3.5% as occupancy declined by 1.7% to 80.2%. With no additional new supply, the area has been conceding demand growth to the new and trendy area of Marina Bay, resulting in demand in the Orchard area declining during 2011 by 1% and year to June was down 1.7%.
The River Valley area, a local hot spot and residential area, saw the city’s highest ADR year-to-June growth at S$238.44 (US$189.56), up 5.6%. During the same period, occupancy declined by 4% to 84.4%. Despite the occupancy decline, RevPAR increased overall by 1.4% to S$201.26 (US$160) during the first six months of the year, mainly led by the strong month of February, up 15.6% when ADR increased by 14% before returning to single-digit levels.