TOURISM is back on its feet again as the country starts to welcome anew foreign tourists, and domestic travelers go out and explore different places again after being stuck at home due to lockdown periods over the past two years, driving hotel occupancies and leisure-related spending nationwide.
Based on the latest Colliers Hospitality Insights report, hotel occupancies in Metro Manila averaged at 47 percent in the first half of 2022, up from 44 percent in the second quarter of 2021.
Average daily rates (ADRs), on the other, rose by 5.4 percent from 4 percent during the two periods in review.
“The Philippines is starting to lure tourists back to its shores. We are seeing a rise in foreign arrivals while improving consumer confidence is propelling the domestic market,” Colliers Philippines Associate Director for Research Joey Roi Bondoc said during their webinar on Thursday.
Citing data from the Department of Tourism (DOT), he bared that foreign arrivals reached 814,144 from January to June of this year, representing a whopping 1,299 percent increase from the 58,177 international tourists posted a year ago.
The growth in foreign arrivals could be attributed to the ease of travel restrictions for foreigners starting February 10, including the dropping of the Covid-19 test requirement before entering the country.
Such tourism spike in the country was also due to the gradual return of business travel, especially among investors conducting due diligence.
The growing propensity of local guests to spend on leisure likely supported the strong demand in the staycation market from April to June.
Tourism surge in the metro, per the study of Colliers, was handled well by a robust accommodation supply, with the delivery of additional 834 new rooms to the total inventory in the first six months of this year, following the expansion of Kabayan Hotel (307 rooms) in Pasay City, Lime Resort Manila (305 rooms) and opening of Hop Inn in Ortigas CBD (231 rooms).
As the DOT expects foreign arrivals to hit 2 million by end of 2022 from last year’s 163,879, recovery of the hotel sector will be sustained in the second half, providing a solid base for 2023 and beyond.
Because of this, the professional services and investment management firm projects occupancy to surpass the 50 percent mark at the close of the year on the back of holiday-induced spending and the return of overseas Filipino workers.
Colliers also sees ADRs to expand by 8 percent for the whole year supported by growth in foreign arrivals and expansion of the domestic market.
This could be accommodated by an estimated 1,830 rooms coming online by end of 2022 as Red Planet Hotel The Fort (245 rooms) and Lansons Place Hotel (250 rooms) are among the hotels due to be finished soon.
With the continued revenge travel, the average room completion is seen at 2,650 annually up to 2024, with the Bay Area and Quezon City accounting for more than 60 percent of the new supply, including from upcoming opening of foreign-branded hotels, namely, Ibis, Pullman, Lansons Place, Westin, and Mandarin Oriental.
“Higher-than-expected economic growth in Q1 [first quarter of] 2022 and further easing of travel restrictions should support the sector’s recovery beyond 2022. However, hotel operators should be mindful of the offsetting impacts of rising inflation and peso depreciation,” Bondoc said.
He also advised them and other stakeholders to prepare for the gradual resumption of MICE or meetings, incentives, conferences, and exhibitions events; create flexible packages for business and leisure travelers; and leverage on the efforts of both the public and private sectors to attract foreign tourists, while improving tourism infrastructures in the country such as airports and expressways.
If you like this article, share it on social media by clicking any of the icons below.
Or in case you haven’t subscribed yet to our newsletter, please click SUBSCRIBE so you won’t miss the daily real estate news updates delivered right to your Inbox.
The article was originally published in Business Mirror and written by Roderick Abad.
About Post Author
More Stories
Banks’ total assets up at P26.2 trillion end-June
Lamudi sees heightened developer confidence with rise in ad spending
Phase 1 of PHINMA’s Bacolod township to finish by next year