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SG Singapore adds 3500 hotel rooms

Property Here - Tuesday, November 26, 2013

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The Singapore hospitality market witnessed two of the biggest deals undertaken in Asia over the last 12 months and also the addition of around 3,500+ rooms, according to Akshay Kulkarni, Regional Director of Cushman & Wakefield’s Hospitality sector group across South Asia and Southeast Asia. 

Despite this, operating numbers indicate almost no stress with capital values up, implying that consumers remain bullish about the market and expect an upside. 

Future demand will not be a problem since there is on-going supply coming into the market while rates have held firm, “which means that there is demand that has come in to absorb most of the new supply”, noted Kulkarni. 

“We think that this momentum will continue as Singapore is considered to be one of the most stable markets in the world.”

“The steady growth in demand and supply will keep the operating numbers / parameters looking healthy. Capital values will continue to rise as there will be a premium to be paid for the stability. Measured supply potential will ensure that vacancy is not high.”

Nevertheless, profitability over the next few years will be impacted by rising manpower costs which will likely affect margins.