SINGAPORE (April 26): The managers of CDL Hospitality Trusts reported 1Q17 distribution per stapled security of 2.42 cents, up 9% from a year ago.

Total distribution rose 10% to $24.1 million while net property income came in at $35.9 million, an increase of 6.4% compared to 1Q16.

The managers said this was supported by strong NPI growth from Grand Millennium Auckland as a result of higher variable rental income which was driven by stronger performance.

In New Zealand, the tourism sector continued to enjoy strong growth, reflected by the 11.8% y-o-y growth in visitor arrivals to a record 3.5 million in 2016. In the first two months of 2017, visitor arrivals increased 6.2% y-o-y to 0.8 million. Accordingly, the hotel enjoyed y-o-y RevPAR growth of 27.6%.

RevPAR for Singapore hotels remained largely stable y-o-y at $159 in 1Q17 as average occupancy rate improved 4.5 percentage points y-o-y to 88.4%, despite the absence of the biennial Singapore Airshow event in the previous year.

In Japan, visitor arrivals increased 13.6% to 6.5 million for the first three months of 2017. Consequently, its hotels there enjoyed strong occupancies of over 90% but faced rate pressure as a result of price sensitivity of the market coupled with a relatively strong yen. Accordingly, RevPAR declined by 7.2% y-o-y due to lower room rates.

In the Maldives, international arrivals from China, its top source market, declined by 4.6% y-o-y for the first two months of 2017. Consequently, its resorts posted a collective y-o-y RevPAR decline of 8.8% in 1Q 2017, due to pricing pressures amid aggressive promotions.

Looking ahead, the Singapore hospitality market is expected to experience competitive trading conditions in the near term, with Singapore’s modest growth outlook in 2017 coupled with net supply for industry room inventory estimated to grow by an estimated 3,767 rooms in 2017, representing a 5.9% y-o-y growth in existing room stock.

Units of CDL Hospitality Trusts ended 1 cent lower at $1.47.