SINGAPORE (Mar 5): Visitor arrivals and tourist receipts rebounded last year. Which, if any, of the hotel real estate investment trusts (REITs) could benefit?

First, the data: On Feb 12, the Singapore Tourism Board announced visitor arrivals rose 6.2% to 17.4 million, and tourism receipts rose 3.9% to $26.8 billion. Tourism receipts for accommodation increased 2% to $4.6 million, and shopping spend rose 9% to $4.7 million. Occupancy rates averaged 84.7%, up 1.5 percentage points y-o-y. Revenue per available room (revpar) fell $2, however, to $183. Room supply rose 5% to 67,084. STB did not announce the average length of stay.

For this year, STB forecasts a growth in visitor arrivals of 1% to 4%, to 17.6 million to 18.1 million, and tourism receipts to grow as much as 3% to $27.6 billion. If visitor arrivals come in at the higher end of the forecast, it would be positive for hotels because net new rooms are likely to grow by just 1.1%. Howarth HTL estimates a supply of 769 new rooms for 2018. At least 426 rooms are undergoing asset enhancement initiatives at Swissotel the Stamford and have been removed from the overall supply this year. Howarth has added back 329 rooms for 2019, taking the overall estimated supply next year to 1,664.

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