The hospitality market will have doubled in size by 2019
Bintan, an island just a short ferry ride from Singapore in Indonesia’s Riau Archipelago, is currently in the midst of a hotel development boom despite foreign tourist numbers fluctuating and low hotel occupancy rates, says a new joint report from consultancy firm C9 Hotelworks and Horwath HTL.
The development boom started earlier in 2015 with the opening of the Canopy, Sanchaya and Swiss-Belhotel. A further 12 hotels are scheduled to open between now and 2019. These vary from luxury to independent boutiques. Alila Villas, Ibis and Four Points by Sheraton are all expected to expand their presence here.
This will add a further 2,200 rooms to the island’s inventory, effectively doubling the size of the Bintan market by 2019. But is there enough visitor demand to support such inclines in the market?
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Bintan has struggled to compete with the increasing number of other ASEAN beach destinations despite its beautiful beaches, proximity to Singapore and popular golfing spots. While these other spots benefit from budget regional air carriers, Bintan has struggled to evolve its tourist attractions and accommodation offering until now.
Source: BPS Indonesia
In Indonesia alone, Bintan trails behind the tourist behemoth of Bali and even Lombok in tourist arrivals (see the graph on the left).
Hotel occupancy has been in decline since 2010 with a new low of below 50 percent reached in the year to September 2015.
Annual foreign guest numbers have fluctuated around the 300,000 mark since 2004, and are dominated by arrivals from Singapore, which contributes to 30 percent of total foreign arrivals.
The only source market to register any strong growth between 2013 and 2014 was inevitably China at 33 percent. The top five source markets today are identical to what they were in 2011, illustrating the market’s stagnation.
The new wave of hotel development, however, has inspired progress in attracting tourists in other ways, too, with a number of infrastructure developments scheduled for the months and years ahead.
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Visa-free gates at Bintan’s three main seaports have been installed, welcoming international visitors from 72 countries and on track to increase to 90 by the end of 2015. This visa-free regime is expected to have a positive effect on arrival numbers.
The Bandar Bentan Telani Ferry Terminal will also be expanded and its capacity increased as demand dictates.
While the majority of visitors enter the island via the seaports thanks to the proliferation of ferries and short travelling time from Singapore and Batam, Bintan is also investing in infrastructure to increase air arrivals.
A new terminal in the existing airport is a recent development while work has started on a second island airport in Busung, Lobam district, which will be able to serve Boeing 747-400 planes and an annual capacity of 3.5 million passengers upon its completion in 2017. Garuda Indonesia has also reportedly committed to developing the island into an aviation hub, according to the report.
Image is by rmlowe and used under a Creative Commons licence
Source : property-report.com
Read more…Will tourist arrivals support Bintan’s hotel boom?
