Colliers urges hotel operators to prepare for gradual recovery of arrivals and leisure spending, especially from local travelers.
Disappointing foreign tourist arrival numbers, due to the Omicron variant, continue to stall the leisure sector’s recovery. Colliers expects a slow recovery for the sector, which should start by H2 2022. Supply-wise, Colliers saw the delivery of 191 rooms in H2 2021. In 2022, we project the completion of 1,600 rooms, up 122% YOY, with the Bay Area accounting for 57% of new supply.
Colliers noted improvement in hotel occupancy rates in H2 2021, partly due to the arrival of more Filipinos using hotels as quarantine facilities, but we expect travel restrictions to continue to stifling demand. Over the next 12 months, Colliers sees hotel occupancy across the country to be propelled by local tourists as well as Filipinos returning from abroad.
Colliers expects a slow recovery in daily rates starting 2022, backed by slight improvement in foreign arrivals and demand from Filipinos returning to the country.
According to Joey Roi Bondoc, Colliers Associate Director and Head of Research: “We do not see an immediate rebound for foreign tourist arrivals especially given the impact of the Omicron variant on global air travel. In our view, local tourists, especially Filipinos returning from abroad, will continue to drive occupancy. We remain cautiously optimistic on the leisure sector’s potential for rebound, partly due to the improvement in Filipinos’ propensity to spend on leisure-related expenditures and as the government allows the reopening of more multi-use hotels. Meanwhile, hotel operators should continue sanitizing their facilities; complying with government’s protocols; and lining up marketing initiatives.”
