Asia Pacific hotel investments cool in 1H2023: JLL

In spite of the muted investment quantities in 1H2023, the solid notes that the hotel market has shown “considerable enhancement” in trading performance, assisted by climbing average day-to-day rates throughout the region’s hotels along with China’s reopening in January this year. “Approaching 2024, we expect to see more certain possibilities emerge in some places around Apac, where prices have been readjusted downwards, allowing interested parties to reassess,” Ercan adds.

Provided these headwinds, JLL has modified its full-year 2023 projection for Apac hotel financial investments to US$ 8.7 billion, down 24% from its initial 2023 quote.

In the remainder of Apac, China also saw a drop in hotel investment activity, by 76% y-o-y to US$ 300 million. On the other hand, Japan preserved strong hotel financial investments, increasing 56% y-o-y to US$ 1.54 billion. In a similar way, hotel financial investments in Australia as well as New Zealand increased, with quantities climbing 189% y-o-y to US$ 820 million.

Based upon a research report by JLL, Asia Pacific (Apac) hotel investment volumes fell by 51% y-o-y in 1H2023, weighed down by macroeconomic challenges and the rising cost of liability. “Coming off a higher base in 2022 and even despite encouraging market fundamentals, hotel investments reduced to US$ 3.13 billion ($4.14 billion) in 1H2023 versus US$ 6.41 billion during the same duration last year,” the report shows.

“We have actually seen the effect of a continued disconnect between the robust tourism need and macroeconomic and even geopolitical obstacles in the very first fifty percent of 2023, causing a space between dealers’ pricing expectations as well as customers’ accessibility to resources,” claims Nihat Ercan, CEO, Asia Pacific, JLL Hotels & Hospitality Group.

TMW Maxwell Singapore

JLL has actually advised on 2 various other significant hotel purchases lately. In July, it encouraged Crystal Plaza Resorts on the transaction of Amari Havodda Maldives resort to Thai hospitality corporation Minor International Public and also its financial partner, Abu Dhabi Fund Development. In June, JLL introduced the completion of Southeast Asia’s first hotel portfolio sale in 2023– Pullman Jakarta Central Park; along with the ibis Saigon South plus Capri by Fraser, both in Ho Chi Minh City– for a combined US$ 106.1 million.

In Singapore, hotel deal quantities totalled US$ 30 million in 1H2023, a 95% y-o-y plunge. The transaction of Parkroyal on Kitchener Road for US$ 388 million, revealed by UOL early on this month, is expected to bolster the segment in the year’s second half. The hotel, located in Little India, was purchased by Midtown Properties, a unit of the Worldwide Hotels Group. JLL guided on the sale.

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