SPRING
2014
ASIA PACIFIC
Lodging Real Estate Trends – Executive Summary

Pipeline Posts Gains, Hits New Highs.

The Asia Pacific Pipeline hit a new high in Q1 2014 with 2,610 Projects/593,963 Rooms, up 4% by projects and 2% by rooms Year-Over-Year (YOY). The total Pipeline is up more than 40% compared to five years ago. Consequently, new hotel openings should also set record highs in 2014 and 2015, culminating years of intense planning and development signings by global franchise companies.

Projects Under Construction also set a new high mark with 2,005 Projects/446,293 Rooms, up 7% by projects and 5% by rooms YOY. Projects Scheduled to Start in the Next 12 Months have 269 Projects/65,613 Rooms and are up 8% and 9% respectively YOY.

With more projects progressing through the Pipeline towards construction, Early Planning is down 11% by projects YOY. Developments are accelerating through the Pipeline at a faster pace as concerns about future credit tightening and overbuilding are on the rise.

Leading Countries
Three countries, China, India and Indonesia, represent 89% of the Asia Pacific Pipeline. China leads the way with 70% of the regional Pipeline, 1,824 Projects/443,692 Rooms. Projects Under Construction in China leapt to 1,530 Projects, up 8% YOY.

China also has 18 of the 20 largest Pipeline markets, led by Beijing with 95 Projects/13,574 Rooms, Hong Kong 83 Projects/14,803 Rooms, Shanghai 81 Projects/16,892 Rooms and Guangzhou 75 Projects/13,114 Rooms. The remaining 14 markets range from 26 to 54 projects and have an average of 40 projects. Development of high-end projects in Chinese urban centers continues to be very strong and represents enormous opportunity for global brands.

India continues to be the second largest country for hotel development in the region with 312 Projects/49,565 Rooms, accounting for 12% of the total Pipeline by projects. Development activity, however, continues to slide with the Pipeline down 10% YOY by project count – its lowest point in more than five years. The number of Projects Under Construction and the number of rooms in Early Planning also sunk to five-year lows. The three largest markets in India are Mumbai with 25 Projects, Bangalore 17 Projects and Gurgaon 16 Projects.

Indonesia has the region’s third largest Pipeline with 186 Projects/33,041 Rooms. Jakarta is the fourth largest market in Asia Pacific with 60 Projects.

Indonesia and many other Asia Pacific countries posted growth after being flat throughout 2013. Excluding China and India, the Pipeline for the remaining Asia Pacific countries struck a cyclical high of 100,706 Rooms. Projects Under Construction jumped 8.9% YOY. Notable markets outside of China and India include Bali with 27 Projects, Bangkok 20 Projects, Singapore 17 Projects, Manila 15 Projects, and Seoul 11 Projects.

Chain Scales & Franchise Companies
The majority of development continues to occur in the higher chain scales, Luxury, Upper Upscale and Upscale. Together these chain scales represent a total of 1,561 Projects, amounting to 60% of the Pipeline.

However, Upscale with 722 Projects, Upper Midscale with 334 Projects and Midscale with 243 Projects all hit new project count highs, signaling an accelerating flow of new mid-market supply from global and regional franchise companies over the next few years.

A remarkable 86% of projects in the Asia Pacific Pipeline have already selected a brand. Franchise companies with the strongest Pipelines in Asia Pacific are: 1) Marriott International 191 Projects/52,065 Rooms 2) Starwood Hotels & Resorts 184 Projects/50,909 Rooms 3) Hilton Worldwide 182 Projects/54,581 Rooms. Notably, Marriott and Hilton are poised to double their current supply of open and operating hotels (census) in the region when their existing Pipelines come to fruition.

Order the complete Asia Pacific Construction Pipeline Trend Report or a Market Trend Report for any individual market.

LE’s Construction Pipeline Trend Report for Asia Pacific presents an unmatched review of lodging real estate and development activity. Ideal for monitoring development growth trends, the report contains current and comprehensive views of the Construction Pipeline by Project Stage (Early Planning, Scheduled to Start in the Next 12 Months and Under Construction), LE’s Proprietary Three-Year Forecast for New Hotel Openings, current counts for Open & Operating Hotels (Census) and New Hotel Openings for the previous two years.

An LE Market Trend Report for any Individual Market will supply you with every lodging real estate fact needed about a particular market. Reports provide a summary of the Construction Pipeline as well as contain individual Hotel Records with full details on New Construction Projects, Brand Conversions, Announced Renovations, and Open & Operating Hotels (Census).

To order LE’s Construction Pipeline Trend Reports for Asia Pacific, or an individual Market Trend Report for a particular market, updated quarterly, please call +1 603-431- 8740, ext. 25, fill out the following inquiry form or email info@lodgingeconometrics.com for more information.