Outllook remains negative, as visitor arrivals are expected to dip.
Weak revenue per available room (RevPAR) will continue to haunt the hospitality sector this year, as outlook on visitor arrivals remain muted.
According to DBS Group Research, demand in 2017 will grow 4% YoY, but as corporate demand is expected to remain soft, projected demand for accommodation growth should remain modest.
"Persistent supply pressures arising from a 6% increase in room stock will pressure room and occupancy rates. We
project RevPAR to fall by 4% in 2017 before rebounding thereafter," the research firm noted.
DBS cited two risks that may affect the hospitality sector this year, including the slower-than-expected rebound in Chinese tourist arrivals and greater level of competition from regional markets that would cause RevPAR to drop more than expected and the upside risk that would come from delays in opening of new hotels.
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