Colliers Bali Hotel Market Report 4Q 2010

Bali Hotelbali toUrism overviewThe ministry of Culture and Tourism has put a target of 7.7 million foreign tourists for Indonesia in 2011, an increase of 10% over the total in 2010. Using a bifurcated approach, the ministry is setting 7.7 million as its optimistic or “best case” scenario, with 7.3 million visitors as a more pessimistic projection. The minister also said that he subdivided foreign tourists coming to Indonesia into three broad categories. First, there are the prime markets capable of generating mass tourism to Indonesia, such as Singapore, South korea, China, Taiwan and other nations in South-east Asia. A secondary market is the high-spending, long-staying tourists coming from Germany, the United States, France and Holland. Finally, there are the smaller, fast-developing markets with high-spending patterns, such as Russia and the Arab nations.

Based on the information issued by Statistics Bureau office in Bali, the number of foreign tourists visiting Bali from January – November 2010 was recorded at 2.4 million, up by 10% compared with the same period of the previous year. This number exceeded the target set by the Bali province Government of 2.3 million tourists. The Bali province Government has targeted around 5 million tourists in 2015 depending on the infrastructure in every Bali Regency being prepared, acknowledging that tourism development is scattered across all parts of Bali and not only concentrated in Southern Bali.

Regionally, tourists from ASEAN and Asia pacific countries continue to dominate the profile of tourists visiting Bali, i.e. 23.09% and 12.55%, respectively. Tourists from Singapore hit the record, with a 70.2% increase compared to the previous year, followed by Australian tourists with an increase of 42.7% YoY, while the number of tourists from Japan declined quite significantly, by 25.1%.

Another good story is that Russian airline Aeroflot has received permission to operate twice-weekly flights between moscow and Denpasar, and that the current twice-weekly charter between Russia and Bali by Transaero Airlines will soon be converted to scheduled services. meanwhile, Australian carrier Strategic Airlines is increasing to three the number of weekly flights from Brisbane to Bali. The current once-weekly flight Brisbane-port

Hedland-Bali service will get a boost via twice-weekly new flights Brisbane-Townsville-Bali.

sUPPlYBali Tourism Board (BTB) recommended to the government a temporary moratorium on the construction of new hotels in Bali. If implemented, it will require Bali’s regents and municipal mayors to freeze the issuance of new building permits, despite strong desire by investors to commence hotel projects. The reason behind this is the limited carrying capacity of Bali in terms of infrastructure, water supplies and electricity supply. So far, the Governor of Bali has appealed to the Investment Co-ordinating Board for this action to limit hotel permits, in particular in Badung, Denpasar and Gianyar regencies. Apparently, pHRI Bali (the Indonesian Hotel and Restaurant Association) does not entirely support the idea and thinks

that the Governor’s appeal carries little legal weight. because the permit decision will come from the Regional Government (at Regency level). However, pHRI agrees with the appeal in principle, i.e. regulating hotel supply, but selectively. New hotel permits should clearly outline their development concept, specify their target market and not follow regular markets.

The Conde Nast Traveller Gold List for 2011 is out, with four Bali Hotels ranking high in the list of the world’s best hotels. It is drawn from comments from the publication’s readers and averages their rating scores against specific criteria. To be included in the survey, a hotel or resort must rank high over a required minimum number of responses. Hotels appearing in this year’s results include Amandari Resort Ubud, Four Seasons Resort at Sayan, Ubud, Ayana Resort & Spa Bali, and Four Seasons Resort, Jimbaran.

nUmber of foreign toUrists visiting bali

Department of Culture and Tourism, Bali Statistics

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500,000

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toP ten coUntries with most toUrists visiting bali, 2009 - 2010

Department of Culture and Tourism, Bali Statistics

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Australia Japan pRC Taiwan malaysia South korea

Uk France Singapore Germany

2009 2010

P. 4 | colliers international

bAli | 4Q 2010 | THE KNOWLEDGE | HOTEL SECTOR

Amidst the volatile global economy, and the issue of a rabies outbreak, Bali continues to attract tourists, as reflected from the occupancy level during the year stable at above 70%. Compared to the previous year, the occupancy rates in Bali experienced a growth of 0.2%, to 1.8%. This has also correlated with positive trends in the ARR, which also pose an upward trend, of between 2% and 5%.

During 2010, no new hotel is being operated, thus bringing the cumulative supply of star-rated hotel rooms in Bali to 21,376 rooms. About 46% of all rooms are provided by 5-star hotels.

on future supply, the Regent hotel chain is set to return to Indonesia to manage and market a new luxury property to be built by Grand pacific properties Ltd (Gpp), a group of mayapada, on a four-hectare estate in Sanur, with a total investment of between US$75 million and US$100 million. The five-star Regent Bali will consist of 150 rooms and 50 villas, each equipped with a private swimming pool. Another future hotel is the All Seasons Bali in Denpasar, located in the commercial and administrative area, with 160 guest rooms. All Seasons Bali Denpasar will debut in 2011 and will be the second All Seasons for the islands. Ibis kuta Bali will be located amongst the kuta action, capitalizing on the strength of the international and domestic economy hotel demand in this area. once open in 2011, the hotel will feature 180 guest rooms. pullman Legian, which was previously targeted to open in 2010, postponed operation to mid-2011.

Performance of 3-, 4- and 5-star

nUsa dUaFor decades, the Nusa Dua area has aimed at mICE market, as many international hotels are equipped with facilities to support conferences. From 5,100 hotel rooms are available in Nusa Dua, with 5-star hotels dominating in terms of numbers of rooms (70%) and hotels (59%).

nUmber of hotels rooms in bali

Colliers International Indonesia - Research

nUmber of hotels develoPment in bali


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Nusa Dua Tanjung Benoa Sanur kuta Jimbaran Seminyak Ubud

3 star 4 star 5 star

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12

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Nusa Dua Tanjung Benoa Sanur kuta Jimbaran Seminyak Ubud



hotel sUPPlY in nUsa dUa

based on nUmber of rooms based on nUmber of hotels

3 star17%

4 star13%

5 star70%

3 star18%

4 star23%

5 star59%


bAli | 4Q 2010 | THE KNOWLEDGE | baLi SECTOR

The hotel performance in Nusa Dua was relatively flat during 2010. occupancy for 3-star-rated hotels stayed at 78.1%, down slightly when compared to the same period last year. All hotels of this category registered an increase in occupancy in December, albeit still lower than achieved in June this year. For 4-star hotels, occupancy in the last quarter this year averaged 76.6%, slightly higher than the figures recorded in the last quarter of 2009. While the overall occupancy for 5-star hotels in 4Q 2010 was lower than in the previous quarter, from 80.4% to 77.6%, it was still higher than what was achieved in the last quarter of 2009. In the 3-star category, Goodway hotel recorded the highest occupancy, while in the 4-star category, kayumanis private Villa & Spa reached higher occupancy than other hotels. meanwhile, Nusa Dua Beach hotel fetched the highest occupancy rate, at above 80%. All in all, the average occupancy rate for all hotel categories in Nusa Dua was 76%.

The ARR performance also posted a relatively flat performance QoQ. However, YoY ARR performance for 2010 was better for 3- and

tanjUng benoaTanjung Benoa, located in the northern part of Nusa Dua, and having beaches similar to Nusa Dua, has become the centre of watersport spots in Bali. of the total available 1,785 rooms from 13 hotel developments, 5-star hotels dominated, both in number of rooms and hotels, i.e. 65% and 46%, respectively.

All hotel categories in Tanjung Benoa area had similar occupancy rates, ranging from 76 to 77%. The 3-star hotels posted a similar performance YoY, i.e. from 76.5% in 2009 to 76.4% in 4Q 2010. In 2010, occupancy rates for 3-star hotels only fluctuated between 76 and 77%. performance of two 3-star hotels: Rumah Bali – Benoa and The Benoa Beach Front Villas and Spas, are almost similar, i.e. around 80% in December 2010. meanwhile, Novotel Benoa Bali performed the best in the 4-star category, where in December, the AoR hit 82%. AoR for the 4-star category was 77.1%, down 1% on the overall figure in 2009 and last quarter. In the 5-star category, two hotels achieved occupancy of around 80%: Grand mirage and Ramada Resort Benoa, but these figures are not significantly different from the performance of other 5-star hotels in Tanjung Benoa, with overall occupancy recorded at 76%.


hotel Performance in nUsa dUa

based on average occUPancY rates based on average room rates

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4-star hotels but not for 5-star, with ARR down from that achieved in the last quarter of last year. ARR for 3-star hotels was down from 73.7% last quarter to 72.6%. Highest ARR among the 3-stars was achieved by Club med Bali, at above US$90, which also suggests an increase on the last figure in 2009. In the 4-star category, the ARR figure as at end of this year was higher than achieved in the same period of 2009, from US$122.88 to US$125.72. During

the quarter, ARR increased gradually and hit the record in December 2010. The highest ARR for 4-star hotels in Nusa Dua was maintained by kayumanis private Spa & Villa. meanwhile, with miscellaneous 5-star hotel quality in Nusa Dua, ARR ranging from US$42 to US$278, the highest still maintained by Amanusa hotel. With wide disparity in ARR among 5-star hotels in Nusa Dua, the overall ARR for 4-star hotels was higher than for 5-star hotels.


hotel sUPPlY in tanjUng benoa


3 star15%

4 star20%

5 star65%

3 star31%

4 star23%

5 star46%


hotel Performance in tanjUng benoa


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The 2010 figure for ARR of all hotel categories in Tanjung Benoa showed a positive trend YoY; however, the QoQ figure was somewhat down. In the 3-star category, ARR was recorded at US$72.69, up from US$69.81 in 2009, but this was lower than achieved in 3Q 2010, which

sanUrEver since Bali Beach hotel (now Inna Grand Bali Beach) became the first hotel in the area, Sanur was known as a tourism spot offering serenity and tranquility for tourists avoiding hustle and bustle. In recent times, Sanur has provided 2,589 rooms from 15 operating hotels, with the 5-star category dominating in the number of rooms (53%), while 3-star hotels led in the number of hotels (47%).

Four-star hotels performed well compared to other categories, reaching occupancy rates of 80.6%, higher than the performance of 3-star hotels at 73.9%, and 5-star hotels at 71.9%. of the five 3-star hotels, Tanjung Sari and Bali Handara kosaido Country Club fetched high occupancy of above 80%, particularly in December. overall, the performance of 3-star hotels in Sanur during 4Q 2010 was the lowest in 2010, albeit moderately. In the 4-star category, average occupancy rate during 2010 was stable at around 80% and the occupancy level for the 4-star category was similar for all operating hotels. meanwhile, the AoR of 5-star hotels was the lowest of any category, at 71.9%. This was higher than those achieved in 2009 (67.9%) but slightly lower than in the previous quarter (73.2%).

The ARR pattern for hotels in Sanur is somewhat unusual, particularly because overall ARR for 4-star hotels was higher than those achieved by 5-star hotels. All operating 5-star hotels in Sanur are old development sand so cannot achieve the rates of new 4-star hotels in Sanur. During 4Q 2010, ARR of 3-star hotels was recorded at US$57.18, 4-stars at US$75.18,

was US$73.65. Rumah Bali and The Benoa Beach Front consistently achieved ARR of between US$74 and US$80. Bali Tropic Resort captured the highest ARR, of above US$92, in the 4-star category. The ARR of the 4-star category was US$75.65, up from US$71.67 in

2009 but lower than 3Q 2010 figure of US77.01. meanwhile, ARR for the 5-star category was US$94.04, higher than the 2009 figure of US$93.00. In this category, three 5-star hotels led, with ARR of above US$100: The Bali khama, melia Benoa Bali and Conrad.


hotel sUPPlY in sanUr



hotel Performance in sanUr


3 star17%

4 star30%

5 star53%

3 star47%

4 star33%

5 star20%

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while 5-stars were US$59.87. Nevertheless, although ARR was relatively low in Sanur, rates were relatively stable during 2010. In a YoY review, we found that ARR was up from 2009 to 2010, ranging from US$4.00 to US$7.00.

Across all hotel categories, mercure Resort and pavilions fetched the highest ARR, at above US$80.


JAKARTA | 4Q 2010 | THE KNOWLEDGE | OFFiCE SECTOR

kUtakuta has been the favourite location for both local and foreign tourists. The magnet of kuta has attracted around 41 hotels here, providing 7,057 hotel rooms. In terms of hotel room numbers, 4-star hotels dominate with 50%, while in terms of number of hotels, both 3- and 4-star hotels share around 44% of the total supply.

Averaging at 77.6%, 3-star hotels captured the highest occupancy level of the categories in kuta. This figure was low compared to the previous quarter and to what was achieved in 2009 (76.9%). AoR for 4-star hotels achieved 74.9%, again, lower than the figure in the previous quarter (76.4%), but slightly higher than 2009’s figure of 73.7%. meanwhile, the 5-star hotels only averaged 69.6% this quarter, not very different from 2009’s occupancy of 70.3%. There were no prominent hotels with higher occupancy; in general, all hotels in kuta captured the same figures in their respective categories.

In 2009 and 2010, the 3-star hotel category recorded a climb in the ARR by about US$6.00, to US$69.21 not very different from the ARR for 4-star hotels in kuta at US$71.72. meanwhile, the ARR for 5-star hotels in kuta registered at US$91.60, also an increase on the figure for 2009, recorded at US$83.22. In terms of ARR figures, Bounty Hotel and kumala pantai led, with high ARR in the 3-star category, while Bali Dynasti in the 4-star category fetched high

jimbaran and PecatUof the total of 12 hotels operating in the Jimbaran and pecatu areas, 58% are 5-star hotels, which lead the market, with more hotel developments than any other hotels in the areas.

overall occupancy rates for hotels in Jimbaran and pecatu are relatively stable, with the 3-star category achieving the highest occupancy. In 4Q 2010, AoR for the 3-star category was recorded at 80.5%, but this figure was lower than was achieved in 2009. Likewise, in the 4-star category, occupancy rates reached 79.7%, this evenly distributed among the 4-star hotels. occupancy in the 5-star category was somewhat lower, at 76.2%, and among operating 5-star hotels, occupancy ranged from 73% to 82%.


hotel sUPPlY in kUta



hotel Performance in kUta


3 star27%

4 star50%

5 star23% 3 star

44%

4 star44%

5 star12%

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ARR. In the 5-star category, two hotels achieved high ARR: Ramada Bintang Bali Resort and The patra Bali Resort & Villas.


hotel sUPPlY in jimbaran and PecatU


3 star22% 4 star

4%

5 star74%

3 star25%

4 star17%

5 star58%



The Jimbaran and pecatu areas are known as exclusive area, where several high-end hotels operate; thus, the ARR was high, particularly for the 5-star category. In the 3-star category, ARR ranged between US$42 to US$59, with an average of US$50.06. This figure was higher than 2009’s figure, which wash recorded at US$40.56. From early- to end-2010, the ARR figure for 3-star hotels posted a climbing trend. meanwhile, ARR for the 4-star category reached US$93.56, and this figure has been relatively stable in 2010. The ARR for the 5-star category was one of the highest in the whole Bali area. In 4Q 2010, ARR reached US$229.65, driven largely by expensive hotels like Four Seasons Resort and Bvlgari Hotel and Resort.

seminYak and canggUFrom eight star-rated hotels operating in the Seminyak and Canggu areas, 918 rooms are provided, with 5-star hotels dominating in terms of number of rooms and number of hotels.

Three-star hotels in Seminyak and Canggu areas reached occupancy rates of around 75.4%, slightly higher than in 2009, while occupancy rates for 4-star hotels were recorded at 81.2%, posting a stable performance during 2010. Despite showing a good trend, the 5-star category experienced a relatively low performance in this quarter, reaching 73.3%. But this has been a good trend, given that the performance in 2009 only reached 65.8%. From the first quarter in 2010 to end-2010, Bali hotel performance has showed gradual improvement. In the 5-star category, Sofitel reached higher occupancy than others.

Two 5-star hotels reached high ARR of above US$200: The Legian and Tugu. overall, theARR for 5-star hotels was US$172.36, which was way higher than those achieved in 2009, at US$149.27. The ARR for 3-star hotels reached US$66.83, which was also higher than in 2009, at US$62.97. Four-star hotels recorded ARR of US$122.35, compared to US$113.06 in 2009. All in all, the star-rated hotels in Seminyak and Canggu areas showed a good trend in the achieved ARR.


hotel Performance in jimbaran and PecatU


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hotel sUPPlY in seminYak and canggU


3 star25%

4 star13%

5 star62%

3 star25%

4 star12%

5 star63%


hotel Performance in seminYak and canggU


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UbUdWhile other areas in Bali emphasize their strength on a beach tourism concept, Ubud offers unique tourism, emphasizing art, culture, mountains, rivers and paddy fields. There are many hotels in Ubud, but generally they offer exclusive and limited rooms. From 795 rooms available, 43% are categorized as for 5-star hotels.

The performance of each 3-star hotel in Ubud was almost identical, with average occupancy hovering at 80.4%. This was better than the performance of 4-star hotels, which reached only 74.9%. meanwhile, the 5-star category captured around 78.2% this quarter, about the same figure as in 2009. Nothing so prominent as in the performance of AoR, with many hotels in Ubud reaching occupancy of 80%.

offering exclusivity, large hotels in Ubud are expensive. The 3-star hotels alone could reach ARRs of US$148.93. This figure was about the same as in 2009 but, interestingly, high ARRs for 3-star hotel were achieved in 2Q 2010, at US$152.74. Expensive hotels in the 3-star category included The Viceroy Bali Villa, Bagus Jati Villa & Resort and Bhanuswari Resort & Spa. meanwhile, the ARR for the 4-star category is about the same as for the 3-star, at US$149.42. Looking at the trend, ARR for the 4-star category showed an increasing trend. Almost all hotels in the 4-star category fetched ARR of above US$100, with only one below that. The highest ARR was reached by Ubud Hanging Garden, with ARR of above US$200. Five-star hotels in Ubud are definitely the most expensive in the whole of Bali Island. only one

other areasother areas in Bali in our definition include areas like Candi Dasa, karang Asem, Lovina, Nusa Lembongan, pemuteran, Singaraja, Denpasar, klungkung and Buleleng. In this area, the number of star-rated hotels in our database totalled 1,466 rooms. Three-star rated hotels dominate, both in number of rooms and hotels, i.e. 55% and 59%, respectively.


hotel sUPPlY in UbUd



hotel Performance in UbUd


3 star17%

4 star40%

5 star43%

3 star23%

4 star39%

5 star38%

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hotel had an ARR of below US$100, the majority fetching ARR of between US$200 and US$400. The overall ARR in Ubud was US$256.44 (about the same figure as last year), the highest ARR for the 5-star hotel category in the whole of Bali. Two hotels reached ARR of around

US$400: Amandari and puri Wulandari. meanwhile, albeit slightly lower, Four Seasons Resort at Sayan also fetched high ARRs, of above US$350.


hotel sUPPlY in other areas


3 star55%

4 star40%

5 star5%

3 star59%

4 star33%

5 star8%




hotel Performance in other areas


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moving upward from US$48.36 in 2009 to US$51.01 at the end of 2010, most 3-star hotels posed an upward trend, albeit moderately. Two hotels recorded high ARR of above US$100 in the 3-star category: Alam Anda Beach Bungalow in Lovina and Waka Gangga Resort. Likewise, a climbing ARR trend was also noted in the 4-star category, moving from US$70.05 in early 2010 to US$74.61 in 4Q 2010. Two hotels recorded high ARR of above US$100: Villas Sassoon in Candi Dasa and Damai Lovina Villas in Lovina. For the 5-star category, the ARR was registered at US$242.79, up from US$229.92 in early 2010. Amankila achieved the highest ARR among operating 5-star hotels, at around US$470.



Colliers Bali Hotel Market Report 4Q 2010

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