Singapore is on pace to compete with Hong Kong in terms of tourism demand and hotel development. According to Asia One, the growing attraction of Singapore as a tourist destination has made the local hotel industry as competitive as Hong Kong's.
"We used to be a boring destination that was cheap to come to," Clarence Tan, InterContinental Hotel Group's senior vice-president of development in Asia, Middle East and Africa told The Straits Times. "But today, as Singapore matures as a city, it has become a much more exciting place to see and visit." This is evidenced through the recent sharp increase in new hotel rooms.
Singapore has added 15,746 rooms in the past five years, while Hong Kong added 14,527 rooms, according to a report by property consultancy CBRE. Tan views the hotel marketing Singapore as strong over the next two to three years, with the majority of influx coming from the growing middle classes in countries like Indonesia, India and China.
The demand for tourism will continue to spread north, as Singapore's tourism offerings continue to develop. The Jurong Lake District, for example, will bring a wealth of hotel investment as that area continues to develop. IHG will consider opening hotels there, as well as in areas like Sentosa and at Changi Airport.
The Singapore Tourism Board reports that the average occupancy across all hotel segments stands at 86 percent.
That said, Asia One still reports that there are obstacles for hotel owners that need to be overcome. "The biggest problem lies in having enough people to run the hotel," Kaushik Vardharajan, partner managing director of HVS Global Hospitality Services in Asia Pacific told the news outlet. "The recent changes in labor laws have made it even more difficult to overcome this, and that's not going to change any time soon." Other obstacles include pricy hotel room rates, which could push visitors to traveling to cheaper destinations like Seoul or Bangkok.