Representative Image: Asia’s hotel industry is set to experience significant growth in 2023, with the latest data showing Tokyo emerging as the city with the highest average daily room rate (ARR). The region is experiencing significant occupancy growth and soaring rates, with forecasts indicating average room rates could rise by 3-8% next year. Occupancy Growth in Major Asian Cities
Global occupancy growth in major markets is nearing normalization, with Asia seeing year-to-date (YTD) growth in 2023 ranging from 108% to 153% compared to the same period in 2022. Notable cities contributing to this growth include Beijing leading the way at 153%, Shanghai at 139%, Tokyo at 137%, Hong Kong at 124%, Singapore at 113%, Delhi at 111% and Mumbai at 108%.
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Average accommodation price in Asia
Average room rates in Asia will see strong growth from 2022 to 2023, increasing by $33 to $173. A sharp rise in prices earlier this year contributed to this overall increase, with nominal growth of just 1% in the third quarter of 2023. Tokyo has the highest average room rate at $281 per night, followed by Seoul at $277, Singapore at $265 and Hong Kong at $246.
In India, the average rates are reported as follows: Bangalore $143, Mumbai $148, Delhi $135 and Chennai $96. Meanwhile, in China, Hong Kong tops the list with an average of $246 per night, followed by Beijing $166 and Shanghai $141. International tourism predicted to reach nearly 90% of pre-pandemic levels by end of 2023: UNWTO
Asia Pacific lagged behind, reaching only 62% of pre-pandemic levels during the period due to a slower resumption of international travel. South Asia in particular showed an impressive recovery of 95%, while Northeast Asia only managed around 50%, highlighting mixed performance across sub-regions.
While corporate average room rates (ARR) have remained stable over the past six months, FCM Consulting predicts that average hotel room rates will increase by 3-8% in 2024. Rising operating costs and investments in sustainability initiatives are driving hotels to implement rate increases.
Commenting on strategies to weather rising costs, Bertrand Sillet, Managing Director of FCM Travel Asia, said: “To combat price increases while managing reduced travel budgets, we offer several solutions to our clients, such as modifying options to stay within budget, consolidating suppliers for leverage, or considering lowering ‘star rating’ expectations without sacrificing service and quality.”
Hotel occupancy and rate trends in Asia reflect evolving dynamics in the travel and hospitality industry, with Tokyo standing out as a premium destination with the highest average room rates in the region.
Published on Dec 4, 2023, 4:44 PM IST
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