Tourism Surge Boosts Hotel Revenue Despite Declining Tourist Arrivals
Singapore’s hotel industry saw record-breaking performance in September, with average room rates (ARR) surging to S$325.24, marking a 13.4% increase from August and a 14.1% rise year-on-year. This spike exceeded expectations and surpassed previous revenue highs, even as overall tourist arrivals continued to decline.
Despite a slight drop in the average occupancy rate to 83.2% from August’s 85.8%, hotels experienced a strong rise in revenue per available room (RevPAR), reaching a historic S$270.60, a 9.9% increase from August.
The boost in hotel performance was attributed to the Formula 1 (F1) night race, which attracted affluent leisure and business travelers, providing hotels with pricing power to raise room rates. This event saw significant increases in rates across luxury, upscale, mid-tier, and economy hotel segments.
However, experts caution that room rates may moderate in the future due to economic factors such as higher interest rates, which could lead travelers to be more cost-conscious. Despite these challenges, Singapore’s hotel sector continues to perform robustly, with year-to-date room revenue reaching S$3.62 billion, a 73.8% increase compared to last year.
