On top of an uncertain economy, incoming supply glut.
Haunted by disappointing figures for international visitor arrivals and tourism receipts in 2015, the local hospitality sector is wary of what lies ahead in 2016.
According to a report by OCBC, Singapore Tourism Board (STB) statistics reveal that international visitor arrivals to Singapore grew by a marginal 0.9% to 15.2m in 2015. Meanwhile, tourism receipts dipped 6.8% to $22b.
In addition, though monthly visitor arrivals inched up for eight straight months on a YoY basis from May to December, hospitality players are largely cautious on the outlook. This is mainly due to the uncertain macroeconomic landscape on top of an anticipated supply glut of hotel rooms.
Looking ahead, STB predicts international visitor arrivals to Singapore to come in at 15.2-15.7m in 2016, implying growth of 0-3%. Tourism receipts are projected to inch up by 0-2% to $22-22.4b.
OCBC expressed a preference for Ascott Residence Trust because of its resilient extended-stay business model. CDL Hospitality Trusts was also chart-topper, thanks to its cheap valuations.
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