FHT sees ‘continued recovery’ in markets as tourism returns; general increase in RevPAR in Q1

FRASERS Hospitality Trust (FHT) saw an increase in revenue per available room (RevPAR) across its portfolio for the first quarter ended Dec 31, 2022, as international tourism continues to bounce back from the pandemic.

The trust observed “continued recovery” in its markets of Singapore, Australia, the United Kingdom (UK), Japan and Malaysia, the manager said in a business update on Friday (Feb 3).

For FHT’s Singapore portfolio, there was a sustained improvement in RevPAR, which increased 78.9 per cent year on year for the quarter. This was supported by gradual occupancy growth on a quarter-on-quarter basis.

Average daily rate (ADR) improved 87.6 per cent year on year as Singapore reopened its borders from April 2022, coupled with the resumption of marquee events, the manager noted.

Meanwhile, FHT’s Australia portfolio saw a year-on-year increase of 100 per cent in RevPAR for Q1, supported by growth in ADR and occupancy.

Its UK portfolio experienced a rise of 41.3 per cent year on year in the first quarter, though its ADR saw a 4.9 per cent drop quarter on quarter due to seasonal shifts from the peak summer period.

GET BT IN YOUR INBOX DAILY

Start and end each day with the latest news stories and analyses delivered straight to your inbox.

Sign UpVIEW ALL

The manager noted that domestic leisure demand has “fuelled” the early recovery, resulting in the gradual resumption of demand for business travel amid challenging market conditions. However, the recovery pace of the UK remains impeded by rising utility expenses, manpower shortage and heightened inflation, it added.

ANA Crowne Plaza Kobe in Japan saw RevPAR jump 55.7 per cent year on year, with ADR and occupancy likewise improving in the quarter as Japan’s hospitality market recovers, the manager said.

In Malaysia, RevPAR at The Westin Kuala Lumpur rose more than 100 per cent from a year earlier, driven by a strong rebound in occupancy which saw an increase of 47.1 per cent.

The manager said Maritim Hotel Dresden in Germany showed signs of improvement year on year, though the recovery pace continues to be gradual in the absence of Mice (meetings, incentives, conferences and exhibitions) events and international arrivals.

FHT’s gearing stood at 35.2 per cent as at Dec 31, 2022, while the weighted average years to maturity was 1.79 years.

The manager said it is “staying cautiously optimistic” on the year ahead, noting headwinds such as a potential recession, the ongoing Russia-Ukraine conflict and high inflation. However, it highlighted stable interest rates, China’s reopening and strong travel demand as bright spots.

Stapled securities of FHT closed at S$0.50 on Friday, down S$0.005 or 0.1 per cent, before the business update.