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Tokyo still tops the region's hotel room rates with an ADR of 191€ in 2016, an increase of 11.7% from 2015. The rise in room rate is expected to continue until the Tokyo 2020 Olympics.
The year 2016 was a dynamic and volatile one for the hospitality industry. Taking into account several high profile M&As that took place, HRS Hotel Price Radar: 2016 Year in Reviewhas revealed key takeaways, including significant changes in ADR for hotels in several major APAC cities.
Tokyo still tops the region’s hotel room rates with an ADR of 191€ in 2016, an increase of 11.7% from 2015. The rise in room rate is expected to continue until the Tokyo 2020 Olympics. Sydney and Singapore trail closely behind Tokyo with 175€ (up 2.9%) and 171€ (up 2.4%) in ADR respectively.
Tourist arrivals dipped drastically in 2015 for South Korea due to MERS. But the country has since went on an aggressive marketing push resulting in a surge in tourists from China. This resulted in a spike in ADR in Seoul by 32.5%, or rising from 126€ in 2015 to 167€ in 2016, the highest increase throughout APAC. According to Korea Tourism Organization, inbound tourism rose by 33.1% in 2016. Accor Hotels is planning to open four properties in Seoul this year.
Next in line was Ho Chi Minh in Vietnam with an increase of 31.1% in ADR from 74€ in 2015 to 94€ in 2016, due in large part to an inventory crunch there. Vietnam is also expected to launch e-visa facilities in February 2017, adding to the accessibility of the country and furthering the demand for more rooms in the nascent but burgeoning Southeast Asian nation. Independent properties such as Bay Hotel has opened their first hotel in Ho Chi Minh last year and India, the 10th biggest business travel market globally in 2016 according to a GBTA Foundation report, continues to see room rates rise in certain cities. Bengaluru saw the most pronounced effect in 2016, being the IT hub of India, with ADR rising year-on-year by 16.2%. This growth is expected to continue into 2017.
In contrast, China’s two largest cities – Shanghai and Beijing – experienced dips in their average room rates. This is likely due to the stabilisation in demand and supply of rooms there.
Jakarta and Bangkok meanwhile were the only cities that had neutral growth despite business travel increasing in those two destinations. ADR is possibly tapered by the onslaught of terror attacks and other events that took place in those capital cities in 2016.
Table 1: Average prices per room for hotel accommodation in major cities in APAC region in 2016.
Comparison of average rates, based on non-cancelled bookings. Includes both public and corporate bookings.
Evaluation period: 01.01.2016 – 31.12.2016
Vicky is the co-founder of TravelDailyNews Media Network where she is the Editor-in Chief. She is also responsible for the daily operation and the financial policy. She holds a Bachelor's degree in Tourism Business Administration from the Technical University of Athens and a Master in Business Administration (MBA) from the University of Wales. She has many years of both academic and industrial experience within the travel industry. She has written/edited numerous articles in various tourism magazines.
