Bali Hotel Property Market Report

Transcription

1 Research & Forecast Report 1st Half Year Bali Hotel Property Market Report Accelerating success.

2 This quarter, the occupancy rate of hotels in Bali was similar to Jakarta i.e. 57.4%, down from 68.2% as of the end of. Nevertheless, the ADR is much better than Jakarta at USD even though this reflected a decrease from USD at the end of last year. By end of 215, total hotel rooms in Bali will have grown to 39,65 rooms with additional rooms totaling 42,154 rooms by the end of 218. Ferry Salanto Associate Director - Research Hotel Sector Economy and Tourism Based on data from the World Travel & Tourism Council (WTTC), the contribution of the tourism industry to Indonesia s GDP has been positive suggesting that this industry is on track. Since, the tourism industry continues to make a relatively positive contribution to the Indonesian GDP. From to, it slightly increased by.1% to reach 3.1%. In, the increase was moderate to 3.1% and in, the contribution increased slightly to 3.21%. Given the positive trend, the tourism industry in Indonesia has the potential to become one of the major revenue sources of the country. Direct Contribution from Tourism Industry and Its Percentage of Shares Toward the GDP GDP Contribution (in IDR Billion) 35, 3, 25, 2, 15, 1, 5, 3.25% 3.2% 3.15% 3.1% 3.5% 3.% 2.95% 2.9% 2.85% Tourism Contribution to GDP Percentage of GDP Source: World Travel & Tourism Council

3 Star-Rated Hotel New hotel projects under construction seem to be speeding up their finishing progress to be open for the summer holiday from June to September in an attempt to attract more European guests. Amid concerns of a hotel moratorium, which limits the number of hotel developments in the southern part of Bali and which requires developers to build hotel projects of at least 4-stars with certain criteria that must comply with the regulation, developers are pushing to meet the completion schedule. The hotel moratorium in Bali that was basically issued in early at the governor level, was designed to tackle the southern region s room oversupply, as well as guiding investment to other regions in Bali. However, new hotels continue to be built in southern Bali as the moratorium was rejected by the head of the regency and the city mayor, who have the authority to issue hotel permits. Cumulative Supply of Star-Rated Hotel Projects in Bali Fairmont, one of the big hotel operators, announced their takeover of Regent Bali Sanur Hotel. They officially opened the doors in November. This is the first Fairmont property in Indonesia and Bali and has 12 rooms star 4-star 5-star 215F In early 215, Hyatt Regency Sanur Bali temporarily closed for 24 months of renovation. They expect to re-open in 1Q 217 thus temporarily reducing by 389 hotel room count in Bali, and in particular in Sanur. The reduction of the hotel room supply in Bali as a result of the interim closure of Hyatt Regency Sanur was counterbalanced by the opening of three other 5-star hotels. Ritz-Carlton, located in the hilly Nusa Dua area added 313 rooms. Another new luxury hotel, the Maya Sanur Resort & Spa provides 13 rooms. And the new Watermark Hotel & Spa in Jimbaran has 143 rooms. All in all, by the first semester of 215, there were 559 additional rooms in the 5-star category. In 4-star rated hotels, quite a few new hotels opened in 1H 215. Alaya Hotels & Resorts opened their second hotel in Kuta Bali with 116 rooms. The Swiss-BelHotel Group opened two hotels in Petitenget with 111 rooms and one in Tuban providing 324 rooms. Holiday Inn Group has opened a 171-room hotel in Benoa. The Jimbaran area has a new 4-star hotel, Bali Paragon which provides 377 new rooms. With five new 4-star hotels, the total supply of this hotel category in Bali reached 11,2 rooms. Source: Colliers International Indonesia - Research Cumulative Supply of Star-Rated Hotel Rooms in Bali 18, 16, 14, 12, 1, 8, 6, 4, 2, F 3-star 4-star 5-star Source: Colliers International Indonesia - Research 3 Research & Forecast Report 1H 215 Hotel Colliers International

4 Hotel Developments in Pipeline Name of development star rating str global equivalent rate region No. of rooms projected completion time Padma Puhu Resort 5 Not defined Ubud 149 3Q 215 Mandapa - Ritz-Carlton Reserve 5 Luxury Class Ubud 6 3Q 215 Alila Hotel 5 Upper Upscale Class Seminyak 24 3Q 215 Preference Jivanara 5 Not defined Ubud 42 1Q 216 Mandarin Oriental 5 Luxury Class Bukit Pandawa 121 4Q 216 Nusa Dua Circle Avani 5 Not defined Nusa Dua 192 4Q 216 Mövenpick Resort & Spa Jimbaran Bay 5 Upscale Class Jimbaran Yoo Le Pang Resort 5 Not defined Klungkung Fairmont Hotels & Resorts - Bali 5 Luxury Class Bukit Jimbaran Hyatt Regency 5 Upper Upscale Class Sanur 389 1Q 217 Solis Capella Resorts Hotel 5 Not defined Ubud Preference Batu Belig 5 Not defined Badung Six Senses Bali 5 Luxury Class Uluwatu Rosewood Tanah Lot 5 Luxury Class Tanah Lot Waldorf Astoria Bali 5 Luxury Class Bukit Pandawa The Langham Place 5 Luxury Class Ungasan - Uluwatu Four Points by Sheraton 4 Upscale Class Kuta 186 3Q 215 Novotel - Airport 4 Upscale Class Ngurah Rai Airport 214 3Q 215 Prama Stala Ubud 4 Not defined Ubud 145 4Q 215 Worldhotel Balangan 4 Upper Upscale Class Balangan Harris Benoa 4 Upscale Class Benoa Park Hotel Nusa Dua 4 Upper Upscale Class Nusa Dua Bedrock 4 Not defined Kuta Indigo Hotel 4 Upscale Class Seminyak Meritus Bali Seminyak 4 Upper Upscale Class Seminyak Harris Resorts - Beach Cove 4 Upscale Class Jimbaran Cordis Resort 4 Not defined Nusa Dua 25 4Q 218 Preference Nusa Penida 4 Not defined Nusa Penida Kila Infinity 8 3 Not defined Jimbaran 18 4Q 215 Artotel 3 Not defined Sanur 4 4Q 215 Potato Head Boutique Hotel - The Katamama 3 Not defined Seminyak Source: Colliers International Indonesia - Research and STR Global Budget Hotel The amount of new budget hotel development in Bali was not as high as it was last year. By the end of 215, there will be 356 new budget hotel rooms in Bali, bringing the supply to 1,765. Tauzia Management, one of the biggest budget hotel operators, dominates the market, not only in Jakarta but also in Bali. With the existing POP! Hotel there will be three hotels under Tauzia Management built in Bali, most probably in 215. Other brands are Zest by Swiss-Bel and Fave by Aston, which will invigorate the budget hotel market in Bali going forward. Future Budget Hotel Development in Pipeline Name of development str global rate location Source: Colliers International Indonesia - Research and STR Global No. of rooms projected completion time POP! Hotel Riverview Economy Kuta POP! Hotel Benoa Economy Benoa POP! Hotel Drupadi Economy Seminyak Research & Forecast Report 1H 215 Hotel Colliers International

5 Cumulative Supply of Budget Hotel (by Number of Projects) in Bali Source: Colliers International Indonesia - Research Cumulative Supply of Budget Hotel (by Number of Rooms) in Bali 2, 215 Performance Demand Bali remains the favourite tourist destination in Indonesia, both for domestic and foreign guests. The I Gusti Ngurah Rai International Airport was just honoured as the world s third best airport for service in the category of airports with 15 to 25 million passengers per year. This airport was previously in the seventh position. According to the tourism data from the Statistics Office, Bali is very popular among Australians. By the end of, the number of Australian tourists visiting Bali reached more than 9, and it keeps increasing every year. The Bali Nine execution, which raised tensions between the Indonesian and Australian governments, impacted the tourism sector, especially for Australian guests. By the end of May, the YoY direct arrivals of Australians to Bali shrank by 4.3% YoY to 76,589 guests. The data showed that direct arrivals of Australian tourists to Bali also slightly decreased by.33% month-on-month (MoM). Recently, Bali has become popular with Chinese tourists. Since, the number of Chinese guests visiting Bali has kept increasing, now representing 19.28% of the total. Most likely, the dominance of Australians coming to Bali will be challenged by Chinese tourists. This is further supported by the leading national airline, Garuda Indonesia, opening a direct route from and to Guangzhou, China. 1,6 1,2 8 The top five countries contributing the highest numbers of visitors to Bali based on the most recent data include Australia, China, Japan, Malaysia and South Korea. Geographically, these Asia Pacific countries are in close proximity to Bali and this is further propelled by the availability of many direct international flights to and from Ngurah Rai International Airport. Other potential target markets in the future according to the Statistics Office (BPS) data are Hong Kong, India, New Zealand, Canada and the Philippines P Since, the number of foreign visitors coming to Bali contributed more than 2% of the total foreign visitors to Indonesia. Recently, the number of foreign visitors to Bali has increased and reached 4% of total visitors to Indonesia. Source: Colliers International Indonesia - Research 5 Research & Forecast Report 1H 215 Hotel Colliers International

6 Number of Visitors by Country of Origin 1,2, 1,, 8, 6, 4, 2, 215YTD Source: Statistics Bureau Office (BPS), Bali The Comparison of Visitors to Bali and Indonesia 1,, 8,, Australia Japan China Malaysia South Korea Taiwan France United Kingdom Singapore Germany Netherlands USA Russia Other The Comparison of Foreign Visitors Coming to Bali and Indonesia (excluding Bali) 1% 9% 8% 7% 6% 5% 4% 3% 2% 1% % Bali 29 Indonesia Source: Ministry of Tourism and Bali Provincial Tourism Office Tourism and Travel Investment Growth in Indonesia, Malaysia, Vietnam, Thailand and Philippines 8% 215YTD 6% 6,, 4% 4,, 2% % 2,, -2% 29-4% 29 Indonesia Bali Source: Ministry of Tourism and Bali Provincial Tourism Office 215YTD -6% -8% Indonesia Malaysia Vietnam Thailand Philippines South East Asia Source: World Travel & Tourism Council Based on the World Travel & Tourism Council (WTTC) report, the amount of Travel & Tourism investment in Indonesia represents 29% of the total Southeast Asia total investment of USD14.93 billion. In terms of the growth of investment in the Travel & Tourism sector during the last five years, Malaysia leads with 6.37% growth, followed by Indonesia with 4.53%, Vietnam with 3.14%, the Philippines with 1.89%, and Thailand with.52% growth. 6 Research & Forecast Report 1H 215 Hotel Colliers International

7 Foreign Visitor Spending during Their Stay in Southeast Asian Countries (USD billion) (in USD billion) Occupancy Average Occupancy Rate 1% 9% 8% 7% 6% 5% 4% 3% 2% 1% Indonesia Malaysia Vietnam Thailand Philippines Source: World Travel & Tourism Council % 1Q YTD Bali South Bali Area South Central Bali Area In terms of the amount of money that tourists spend during their stay, Indonesia is far below Thailand and Malaysia. Foreign guests spend almost four times as much in Thailand and twice as much in Malaysia as they do in Indonesia. According to the WTTC report, in Indonesia, domestic guests spend three times more than foreign guests on average. Of the total guests, in terms of purpose of the visit, guests coming for leisure spend three times more than guests coming for business, most likely because, in general, leisure activities take longer than business activities. Comparison of Total Spending between Leisure and Business Purposes in Indonesia (IDR billion) Source: STR Global The overall Average Occupancy Rate (AOR) for the first six months of 215 weakened. Generally, this is not the peak season in Bali. In, the AOR for the Bali area was 65.95% and moved upward in to 68.2%. During 1H 215, the overall AOR was 57%, a drop of 8.95% YoY. The disparity in the growth of hotel supply and demand in Bali during the first semester has resulting in a drop in the occupancy rate. The AOR in South Bali slightly decreased to 56.8% due to the new operation of the hotels mentioned above, which are located in Sanur, Jimbaran, Kuta, and Nusa Dua (in billion IDR) Domestic Foreign Source: World Travel & Tourism Council 7 Research & Forecast Report 1H 215 Hotel Colliers International

8 Average Daily Rate Average Daily Rate USD 2. USD 18. USD 16. USD 14. USD 12. USD 1. USD 8. USD 6. USD 4. USD 2. USD. 1Q YTD Bali South Bali Area South Central Bali Area Source: STR Global The Average Daily Rate (ADR) for hotels in Bali has been decreasing in the last three years. The ADR in was USD and dropped in by 6.9% to USD In the first semester of 215, the ADR was USD124.7 reflecting a 4.12% drop YoY. 8 Research & Forecast Report 1H 215 Hotel Colliers International

9 52 offices in 67 countries on 6 continents United States: 14 Canada: 31 Latin America: 24 Asia: 39 ANZ: 16 EMEA: 18 $2.3 billion in annual revenue Primary Authors: Ferry Salanto Associate Director Jakarta Ferry.Salanto@colliers.com Colliers International Indonesia World Trade Centre 1th & 14th Floors Jalan Jenderal Sudirman Kav Jakarta 1292 Indonesia TEL million square meters managed 16,3 professionals and staff About Colliers International Group Inc. Colliers International Group Inc. (NASDAQ: CIGI; TSX: CIG) is a global leader in commercial real estate services with more than 16,3 professionals operating from 52 offices in 67 countries. With an enterprising culture and significant insider ownership, Colliers professionals provide a full range of services to real estate occupiers, owners and investors worldwide. Services include brokerage, global corporate solutions, investment sales and capital markets, project management and workplace solutions, property and asset management, consulting, valuation and appraisal services, and customized research and thought leadership. Colliers International has been ranked among the top 1 outsourcing firms by the International Association of Outsourcing Professionals Global Outsourcing for 1 consecutive years, more than any other real estate services firm. colliers.com Copyright Colliers International. The information contained herein has been obtained from sources deemed reliable. While every reasonable effort has been made to ensure its accuracy, we cannot guarantee it. No responsibility is assumed for any inaccuracies. Readers are encouraged to consult their professional advisors prior to acting on any of the material contained in this report. Accelerating success.