But it will start to rebound in 2018.
Singapore hotels are still a headache for CDL Hospitality Trusts, as they are expected to end the year with 2% lower revenue per available room (RevPAR).
However, RHB said there is no reason to worry, as RevPARs will likely see a rebound starting 2018.
"We expect RevPAR to rebound by 3% and 5% in 2018/2019 key reason being the tapering off hotel supply. An estimated 3,767 rooms (5.9% of inventory) is set to open this year with a supply for 2018 being a minimal 69 rooms," the brokerage firm said.
In the past quarter, CDLHT's occupancy for Singapore hotels improved 4.5ppts to 88.4% while room rates declined 5.9%. RHB is expecting room rates to stabilise and pick up later this year as competitive pressure eases.
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