Still room for upside for hospitality Reits despite rally
Full recovery in revenue per available room may only materialise in 2022 or even 2023, some analysts say
THE rollout of the first vaccine this month heralds the start of a recovery for the hospitality sector, but have hospitality Reits already rallied too far ahead?
Units in Singapore-listed hospitality Reits leapt in November as news of successful vaccines by the likes of Pfizer/BioNTech and Moderna had investors betting that the green shoots were finally emerging for the tourism industry.
The availability of a vaccine will put hospitality Reits on the path to recovery in 2021, but a full recovery in revenue per available room (RevPAR) - an indicator of performance - may only materialise in 2022 or even 2023, some analysts say. It also remains to be seen whether business travel volumes will be adversely affected in the long-term by a shift towards virtual meetings.
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