Asia Pacific hotel performance declines 30% during Q1

According to new analysis by Deloitte, the business advisory firm, the impact of the global economic crisis continues to impact hotels across Asia Pacific, with revenue per available room (revPAR) falling almost 30% during the first quarter of 2009.

Analysis shows that both occupancy and average room rates continue to fall, down 15.0% and 17.4% respectively, during the first quarter of the year. Occupancy in the region now stands at 57.9%, while average room rates have fallen US$26. As a result, revPAR fell US$30, to end the quarter at US$69.

Marvin Rust, Global Hospitality Managing Partner at Deloitte, said: “Asia Pacific, like all world regions, is being affected by the global economic downturn and is currently the second most affected region in the world after Europe in terms of hotel performance.”

Marvin added: “The terrorist attacks in Mumbai at the end of last year, and the current political protests in Bangkok have not helped performance in a region that is already struggling. Aside from the economic crisis rippling throughout the world, Asia Pacific has had its fair share of unrest in the past, including terrorist attacks in Bali and Jakarta. Each time, each city has bounced back. The only difference this time around will be that performance may take longer to recover, as some markets are dealt double blows.”

In Bangok, revPAR suffered during the first quarter of 2009. Occupancy has led much of the decline, down 28.6% to 54.7%. Average room rates have also dropped, down 16.7% to US$99, leading to a 40.5% fall in revPAR for the quarter. Following the latest protests, a number of countries around the world (including China, Singapore, Australia, UK and United Arab Emirates) issued travel warnings, urging travellers not to visit Thailand unless absolutely necessary.

Most markets across the region are now reporting double-digit revPAR declines, with cities in India worse off. In Mumbai, revPAR fell 53.2% to US$112 during the first quarter of the year. Occupancy has fallen to 61.4%, while a staggering US$125 has been wiped off average room rates, which now stand at US$183. Following the terrorist attacks in Mumbai at the end of 2008, the city has seen hotel performance suffer. However, it is interesting to note that occupancy in the city did not report a single month of growth during 2008, something which has expectedly become worse since the attacks.

During April 2009, daily results from STR Global reported an overall revPAR decline of 45.4%. Occupancy plummeted by more than 33%, falling to a low of 33.5% on 15 April.

Source: Deloitte