THAILAND, Indonesia and the Maldives are currently the hottest hotel investment markets in the Asia-Pacific region, according to Jones Lang LaSalle Hotels.
“We are seeing fantastic potential coming out of Thailand, Indonesia and the Maldives, backed by rising RevPAR, healthy investor interest and solid travel demand,” said Tom Oakden, executive vice president, investment sales, Jones Lang LaSalle Hotels.
“While hotel transactions in Asia and globally have slowed in the last year, investor sentiment remains strong for the right prospects, and these markets are showing the greatest opportunity for capital value growth.”
In Thailand, RevPAR is climbing in Bangkok despite new hotel supply, while resort markets such as Phuket are exhibiting stronger income growth potential. Whereas domestic players once dominated the market, overseas investors are increasingly coming into the picture – with greater liquidity as a result. Thailand has seen five major hotel deals in the last 18 months – including the Mövenpick Phuket, which was the country’s largest open market hotel transaction to date.
In Indonesia, Bali and Jakarta have traditionally dominated foreign investor interest, but this is diversifying to other regions. Lack of new stock is a challenge, although latest Jones Lang LaSalle research indicates that investors are preparing to sharpen yield expectations. Coupled with exceptional year-to-date RevPAR growth, this may help close the gap between the pricing expectations of buyers.
The Maldives has broadened its appeal beyond honeymooners with a healthy influx of Chinese visitors in the last three years. From an investment perspective, the Maldives commands one of the highest ADRs globally and guest capture for food, beverage and ancillary income sources is high. Government policies on foreign investment have also relaxed, allowing leases to be extended for 50-year terms. While RevPAR growth was affected by negative publicity in 1H2012, the destination has rebounded strongly with August showing double-digit RevPAR growth.
