, Singapore

Here's why hotel deal flow is in the doldrums despite robust investor interest

There were zero transacted deals in 1H16.

Despite robust investor interest, the dearth of available assets for sale continue to constrict deal flow in Singapore.

According to a report by CBRE, 1H16 marked the first time in three years that there were no transacted deals within the same period.

Moreover, CBRE shared that asset prices in Singapore remains one of the highest in Asia Pacific, alongside Hong Kong. Further, the lack of deals reinforces the price disparity between vendors and purchasers.

On the flip side, cross border investment are growing more active.

"Singapore firms especially are actively buying assets beyond borders, most significantly in Australia and Europe. Some reasons are the weakening local currency relative to the Singapore Dollar, increasing opportunities in core market stock with prime offerings and positive local hotel market performance," stated CBRE.

Similarly, operator selection or rebranding is also gaining traction among hoteliers.

"The stable hotel market makes it favourable for international brands to expand theur footprint in Singapore. With the recent acquisition of Starwood, Marriott International looks set to launch five additional brands in Singapore. Most recently, the South Beach Hotel was rebranded as JW Marriott Singapore," CBRE revealed.

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