A MAJORITY of hotel general managers in Singapore believe that occupancy and the average daily rate (ADR) will both grow in 2017 compared to end-2016 results.

According to a poll conducted with hotel general managers this month by hospitality investment firm Tourism Solutions International (TSI), 65 per cent of respondents indicated that occupancy in 2017 will increase over 2016.

However, most believe the increase will be tepid with 53 per cent of hoteliers believing that the increase will range between zero and five percentage points. The remaining 12 per cent believe occupancy will grow by more than five per cent next year.

For ADR, 59 per cent of hoteliers indicate that it will increase for 2017 with a 47 per cent majority predicting a minor positive change of up to five per cent.

The upper upscale segment meanwhile accounts for most of the negative outlook, forecasting slight decreases in both occupancy and ADR.

Overall, in terms of gross operating profit (GOP), 59 per cent of hoteliers responded positively with a majority predicting a slight increase of up to five per cent in 2017.

Of the remaining 41 per cent, slightly more than 20 per cent believe profits will take a slight dip of up to five per cent while the others feel that there will be no variance.

A separate TSI forecast resulted in conflicting expectations of flat to minor decreases for all three measures (occupancy, ADR and GOP) in 2017.

TSI explained that despite extremely strong 2016 visitor arrival growth of 12.5 per cent through June, lower growth rates in visitor arrivals, shorter average length of stay and expected supply increases (3,961 rooms) will provide a challenge for hoteliers next year.

Beyond 2017, TSI expects the hotel supply to remain relatively stable for a period due to the lack of available land parcels released by the government in recent years. In addition, Changi Airport’s new Terminal 4 will open next year, facilitating significant growth in future visitor arrivals.

Makan Kitchen at DoubleTree by Hilton Kuala Lumpur

F&B operations are increasingly bolstering the profit margins of hotels with Hilton Worldwide properties in the Asia-Pacific owing over 40 per cent of revenues to its food and beverage businesses.

According to Markus Schueller, vice president of F&B operations, Asia-Pacific, the importance of F&B for hoteliers cannot be understated.

Apart from certain markets such as India, revenue derived from F&B had traditionally been incomparable with revenue derived from rooms. Between 2010 and 2014, the average revenue derived from F&B operations at full-service properties accounted for 25.3 per cent of total hotel revenue, according to research by CBRE.

It seems that for hotel operators such as Hilton, the food and beverage component of the business is increasingly vital.

“Across the Asia-Pacific, over 40 per cent of our total revenue comes from F&B. It is an integral part of our business,” said Schueller, adding that as a company, F&B also helps with aspects such as building rapport with the local community through weddings and banqueting.

“We have some hotels having over 50 per cent of revenue coming from F&B now. It really depends on the scale of the hotel and the F&B operation,” he explained.

When asked if a majority of customers are hotel guests or walk-ins, Schueller said most come from those who live and work in the city. The restaurants and bars have to appeal to them in order to be commercially viable, because while room occupancy is seasonal, those that dwell in the city are always there and a constant source of revenue.

“(However), you can never alienate your hotel guests. It’s a very fine line you have to walk to be different enough in order to attract external customers but cater to in-house guests as well,” he added.

The challenge for Schueller, who manages the entire F&B operation across all 13 Hilton brands in the Asia-Pacific, is to know what to do today what is needed in a few years’ time in order to future proof the concept.

“You need to know what will remain relevant five years, ten years from now,” he said.

He further revealed that while Hilton tends to create and operate their own F&B concepts in the Asia-Pacific, there are instances of commercial success found with third-party operators as well.

Schueller is currently working with a team in Shanghai on a brand new concept that will come out “fairly soon”. While not able to reveal details, he pointed to how Makan Kitchen – a hawker-style dining establishment with live show kitchens – at DoubleTree by Hilton Kuala Lumpur has found favour with locals.

“Last time, hotels built restaurants because there are none nearby. But that has obviously changed. Now, the first reason why people come is because of great concept,” he opined.

MORE Cambodians are venturing abroad as expendable income and connectivity continue to increase.

The number of Cambodians travelling overseas hit an all-time high between January and June with almost 700,000 travelling abroad – a 26 per cent hike on last year, according to latest figures from the Ministry of Tourism (MoT).

Kong Sophearak, MoT director of the department for information and statistics, said: “Though Cambodia is a small country, it is becoming a tourist exporter to neighbouring countries.”

A swelling middle-class and economic boom (seven per cent GDP growth last year) have been the main drivers of the growth.

Ho Vandy, secretary-general of the National Tourism Federation, said: “Cambodians can now afford to travel to neighbouring countries on holiday as well as explore business ventures and have medical check-ups.”

An increase in direct regional flights from LCCs has also played a role. He added: “All these, in turn, make Cambodians want to travel to neighbouring countries.”

Veang Chivuth, operations manager of 2 World Travel Cambodia, believes cheaper offerings have also helped, with the price of tour packages being driven down by competition between local tour companies.

He said: “This makes it affordable for Cambodian tourists to go to neighbouring countries in group tours. Most of our customers like to visit Malaysia and China because of the competitive tour packages that are available.”

In July, the World Bank revised Cambodia’s economic standing, pushing it from a low-income to middle-income economy.

Kiran Vinchhi

THE ATPI Group is making structural and leadership changes in India with recent acquisition deals now complete.

With the legal merger of ATPI and Griffin Travel now complete in India, the TMC – trading as ATPI Griffinstone – will be led by Nitin Hardi, who takes on the role of managing director of the marine and energy specialist division.

The company has also integrated various specialist support functions under the new International Centre of Excellence. As a result, Anna Singh is now managing director of the shared operations centre, headquartered in Mumbai, with a remit to support the strategic objectives of ATPI’s global needs.

Hardi and Anna will be supported by Manish Batra, Griffin’s former general manager of finance, who will be in charge of finance for both areas. All will report to the group’s regional managing director, Kiran Vinchhi.

“As the global leaders in travel solutions to the shipping and energy industries, it is vital that we have a strong leadership team in place to continue delivering the exceptional service that our customers know us for,” said Kiran Vinchhi, regional managing director, India, at ATPI Group.

“The elevated responsibilities of Hardi and Anna reflect the significant contributions they have both made to the company, as well as their track records in delivering innovation and strategic direction where it is most needed.”