Travel Trends - Hotels mirror country fortunes

Imtiaz Muqbil

THE state of regional hotels continues to reflect the state of the regional tourism industry, with Indonesia being perhaps the biggest paradox.

Countries that have been affected by political and other problems are clearly showing it in their hotel performance, while others are benefiting from the return to growth of the Korean market.

In January-September 1999 over the same period of 1998, Jakarta hotels suffered from the biggest declines in yields - a 31.55 per cent drop - while Bali hotels enjoyed the highest increases, albeit on a low base.

This reflects the state of the Indonesian tourism industry, with Jakarta hotels taking a hit in the lead-up to the recent elections due to the long-running political problems.

Bali hotel occupancies were up 29.2 per cent in the same period but the average room rate was down 5.8 per cent.

Jakarta's hotels suffered declines in both occupancies and average room rates. In spite of a US dollar decline in average room rates, Bali was still considered good enough value for money to boost both average occupancies and yields.

Altogether, US dollar yields declined in nine of the 14 cities included in the Arthur Andersen benchmark survey; they rose in only four cities and were unchanged in one.

Yields also took a beating when calculated in local currencies, dropping in 11 of the 14 cities.

Kuala Lumpur is another city in the doldrums, with declines in occupancy, average room rates and yield.

Occupancy dropped by 6.5 per cent to 53.5 per cent, with average room rates falling by 16.8 per cent and yield by 22.2 per cent.

By contrast, Bangkok, with its buoyant tourism industry, is faring well, with increases across the board, including an 11.9 per cent rise in dollar yield.

Manila hotel average occupancies rose but both average room rate and US dollar yield declined. The same trend was seen in Hong Kong. Occupancy in Hong Kong rose by 6.7 per cent, but average room rates fell by 14.5 per cent and yield by 8.8 per cent.

Surprisingly, Japan appears to be doing well. Its hotels have enjoyed a good ride on the back of a robust increase in both tourist and business travellers, mainly from China, Korea, Taiwan, Singapore and Thailand. Yield rose by 14.8 per cent compared with the same period of 1998.

In the first six months of 1999, tourist arrivals from Asia into Japan were up 25 per cent and business travellers up 12 per cent.

At 82.7 per cent, Seoul enjoyed the highest occupancy rates in the period, followed by Tokyo (80.1) Taipei (77.2) and Hong Kong (74.2).

The lowest occupancies were in Jakarta - at 28.3 per cent - followed by Colombo (50.1), Kuala Lumpur (53.5) and Macau (56.2).