Tourism boom drives investments in Philippine hospitality sector
THE booming tourism industry in the Philippines is prompting more investments in the hospitality sector, with almost 9,000 rooms in hotels and serviced apartments seen to be completed until 2021.
This is according to real estate consultancy firm JLL Philippines, which noted that homegrown hotel developments such as Seda Hotels by the Ayala group and Hotel 101 by Hotel of Asia, Inc. drove the hotel industry last year.
Most of the hotels to completed in the next three years are located in Parañaque City, including Okada Manila (Phase 2), The Westin Hotel Manila Bayshore, Seda Bay Area, Kingsford Hotel, and Hotel Okura.
There are 2,100 rooms scheduled to be completed in Makati City, namely Aruga by Rockwell (Phase 3), Seda Circuit Makati, Seda Gateway Makati, Mandarin Oriental Manila, Somerset Valero, Somerset Salcedo, and Seda Ayala North Exchange.
A total of 1,600 are set to be finished in Taguig City: Seda Hotel BGC (expansion), Red Planet The Fort, Hotel 101 Fort, Dusit D2 The Fort, and Seda Arca South.
Meanwhile, Pasay City will see the opening of 1,200 rooms within the period, consisting of Ascott-DD Meridian Park, Kabayan Hotel, Hilton Manila City, Hotel Okura Manila, RitzCarlton, and Red Planet Entertainment City.
Quezon City will also complete about 1,000 rooms by then, namely Red Planet Quezon Avenue, Red Planet Quezon North Avenue, Canvas Hotel Activa, and Movenpick Hotel & Residences.
JLL Philippines said hotels in the Bay Area are expected to command the highest rates due to the presence of resort-casino complexes, which continue to attract tourists from South Korea and Mainland China. Central business districts are also seen to have high room rates.
The development of more hotels in the country comes alongside the government’s efforts to improve infrastructure, such as the proposed rehabilitation of the Ninoy Aquino International Airport, the expansion of Clark International Airport, as well as the Mactan-Cebu International Airport Terminal 2 expansion.
The National Economic and Development Authority is also assessing the proposed New Manila International Airport in Bulakan, Bulacan.
“Apart from infrastructure, another major tourism endeavour is the continuous rehabilitation of Boracay and Manila Bay led by various national agencies working together to make sure that environmental compliance in tourism destinations all over the Philippines is maintained and monitored,” according to JLL Philippines.
Higher hospitality investments in the Philippines is in line with the growth in hotel transaction volumes in the region, with an estimated growth of 15% to $9.5 billion this year.
“Building on 2018, investment momentum is expected to accelerate as investors look to sell assets and ride the anticipated tourist boom. JLL expects that the most notable buyers in 2019 will be PanAsian private equity funds that raised capital last year but have yet to deploy it,” JLL Philippines said.