Demand will continue to outgrow supply: American Express
Thursday, 17 January 2008: Demand for hotel rooms in the Asia-Pacific region by the corporate sector is set to increase again in 2008 at a rate which cannot be matched by supply, claims American Express consulting in their new report.
The American Express 2008 Asia Pacific Corporate Hotel Rate Projections and Market Forecast released Monday predicts that growing corporate demand for rooms in the region will also lead to more room rate increases for 2008.
“Travel Managers and Procurement professionals will continue to face many challenges when managing hotel expenses, however there are steps companies can take to enhance their negotiating position,” said Prashant Aggarwal, American Express Consulting, Head of Japan, Asia Pacific and Australia.
Across the ASEAN markets, occupancy rates fluctuates from region to region, with Singapore maintaining highs of around 81%, and Manila and Kuala Lumpur not far behind, averaging around the mid-70s.
In Australia occupancy levels are boosted by domestic as well as international corporate stays, with most capital cities averaging between 77 to 80 per cent occupancy.
Hong Kong continues to lead the way in terms of hotel occupancy rates, in 2007 recording an average of 85% as demand continues to increase from the mainland.
“It is important companies remain open to the new opportunities presented as the travel landscape continues to change,” said Mr Aggarwal. “We would recommend reviewing the factors that enable travelling employees to conduct business most effectively and then review the preferred list of hotels to ensure their services align with these needs.”
The report also predicts that corporate demand may also become more selective as business become more environmentally knowledgeable and seek hotels which are more environmentally responsible.
“The trend to include CSR [Corporate Social Responsibility] questions into the request for proposals is definitely increasing and hotels that accommodate this are going to end up winning favour,” said Mr Aggarwal.