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offset weakness in the Singapore and Maldives markets
as well as lower contribution from the Australia Hotels
due to negative currency translation and smaller
variable income.
Consequently, total distribution to Stapled Security
Holders for FY 2016 was largely unchanged at
S$99.1 million. We are pleased to deliver Total
Distribution per Stapled Security of 10.00 cents for
FY 2016, compared to 10.06 cents in FY 2015, reflecting
stability in our overall performance.
MARKET REVIEW AND OUTLOOK
In 2016, the Singapore hospitality industry faced
headwinds amidst lower corporate activities which
stemmed from global economic weakness, as well as
increased room supply. As a result, RevPAR for the
Singapore Hotels declined by 8.6% to S$160 in FY 2016.
Total visitor days to Singapore grew 2.2% year-on-year
("
yoy
") for 2016
(2)
. Our Singapore Hotels were able to
maintain a healthy average occupancy rate of 85.4% for
FY 2016.
In 2017, the trading environment in Singapore for hotels
is expected to remain competitive, especially given
the absence of biennial city-wide events such as the
Singapore Airshow in February and Food & Hotel Asia in
April. With a further 5.9% increase in new supply of hotel
rooms
(3)
and uncertainties arising from Brexit as well as
increased global political risks, the outlook remains one
of caution.
Despite uncertainties in the near term, we are optimistic
on the long term outlook for the Singapore tourism sector.
Singapore, being a key financial centre and gateway for
conducting business with the Asia Pacific region and
the rest of the world, continues to be an attractive hub
for conferences and events and was ranked as the top
international meeting city for the ninth consecutive
year
(4)
. Continued efforts by the Singapore government
are also in place to drive tourism flows such as active
marketing by the Singapore Tourism Board ("
STB
") and
infrastructure development. These include strategic
partnership deals between STB and Chinese online travel
services, as well as the ongoing construction of Changi
Airport’s Terminal 4, Terminal 5 and Jewel Changi Airport
– a retail and lifestyle mixed-use complex, which will
serve to anchor Singapore’s position as a leading aviation
hub in the region.
In Japan, demand drivers remained strong with
international visitor arrivals growing 21.8% to a record
24.0 million for 2016
(5)
. Consequently, the Japan Hotels
enjoyed strong occupancies of over 90% but faced rate
pressure partly from currency headwinds during the year
and rising competition from new hotel room supply.
As a result, RevPAR increased marginally by 0.6%. The
long-term outlook for the hospitality sector in Japan is
expected to be positive, with the Japanese government’s
(2)
International Visitor Arrivals Statistics – STB.
(3)
Based on STB, Horwath data (January 2017) and CDLHT research.
(4)
Travel Biz, "Singapore crowned Top International Meeting City by UIA", 30 September 2016.
(5)
Japan National Tourism Organization.
La Residenza Suite, Grand Copthorne Waterfront Hotel
7
Annual Report 2016
OVERVIEW AND
FINANCIAL REVIEW