Singapore hotels’ overall room revenue at year-to-date high in May
Elysia Tan
SINGAPORE hotels’ overall room revenue hit S$398 million in May, up 9.1 per cent from April’s S$364.7 million – marking the highest room revenue to date this year, Singapore Tourism Board (STB) data showed on Friday (Jun 30). It was also up 72.7 per cent from May 2022’s S$230.5 million.
This came as average room rate (ARR) edged down a marginal 0.4 per cent in May to S$270.75, from S$271.89 in the preceding month.
On the year, ARR was up 21.7 per cent. Singapore’s border restrictions eased in April last year, with no Covid tests necessary regardless of vaccination status for visitors from Apr 26, 2022.
May 2023’s revenue per available room (RevPAR) and average occupancy rate were up sequentially. RevPAR was up 2.5 per cent to S$216.19, from S$210.89 in April. Year on year, it grew 33.5 per cent.
Wong Xian Yang, Cushman & Wakefield’s head of research for Singapore and South-east Asia, said: “Available room nights rose 6.4 per cent month on month in May 2023, reaching 1.84 million nights. Notably, this is higher than 1.81 million nights in May 2019.
“This is the highest level since the pandemic, and the first time available room nights have surpassed pre-pandemic levels.”
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Despite this, May 2023’s RevPAR “held steady at above pre-pandemic levels, suggesting that current average room rate levels could persist in the future”, he said.
He added that the increase in room rates has outpaced hotels’ rising operating costs, with profitability exceeding pre-pandemic levels.
“The ongoing recovery in tourism should bode well for future hotel performance, with hotel RevPAR to grow with better occupancy rates,” he said.
At 79.9 per cent, May’s average occupancy improved on the month from 77.6 per cent. It remained under the pre-pandemic rate of 83 per cent in January 2020, but was 7.1 per cent higher on the year.
The latest figures came as tourist arrivals surpassed one million for the third straight month in May, but slipped sequentially.
The month-on-month dip in tourist arrivals was the first since the pandemic, said DBS analyst Geraldine Wong, noting that arrival figures are “hovering” around 70 per cent of pre-Covid levels.
China is in its “early- to mid-phase of recovery”, she said, with the number of visitors from China at about 32 per cent of 2019’s levels.
While DBS’ Wong expects normalisation in China’s outbound travel and meetings, incentives, conferences and exhibition (Mice) events to drive tourism recovery, she suggested that there could be “resistance” from budget-conscious travellers who have been hit by more expensive airfares to Singapore, pricier hotel rooms and a strong Singapore dollar.
“That being said, STB’s effort to increase Singapore’s appeal as a key concert destination within Asia has borne fruit with headline news in recent months – with A-list stars such as Coldplay and Taylor Swift increasing concert counts in Singapore,” she added.
ARRs generally inched up across hotel categories in May, with the luxury segment being an exception, falling on the month to S$569.85. ARR was up to S$328.89 in the upscale segment, S$214.95 in the mid-tier segment and S$142.79 in economy.
Based on STB data, room revenue in the year to date reached S$1.8 billion in May, surging 133.5 per cent from the corresponding year-ago period.
ARR for the five months gained 34.5 per cent to S$271.17; RevPAR rose 62.7 per cent to S$212.04; and average occupancy rate grew 13.6 per cent to 78.2 per cent.
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