SINGAPORE (EDGEPROP) – A 25-room freehold boutique hotel on Desker Road in the Little India vicinity is up for sale by expression of interest (EOI). The site has a guide price of about $28 million to $30 million, according to marketing agent Knight Frank.
The property is currently operating under the name of Hotel Marrison @ Desker, with an average occupancy rate of over 85% in the last two years.
It sits on a land area of 6,664 sq ft, with a total gross floor area of about 12,270 sq ft. The property comprises six adjoining units of two-storey shophouses with attic and has an eating house situated on the ground floor. It has dual frontages onto Kampong Kapor Road and Desker Road.
The EOI exercise will close on Feb 26, 3 pm.
Singapore is one of the world’s leading destinations for business travellers and leisure-seeking tourists due to its geographical location, stable business environment, enticing retail offer and world-class infrastructure.
New hotel brands are set to make their mark. As a haven for long-term investment, Singapore remains popular among investors seeking hotel ownership within the region.
A JLL Research Report titled ‘Singapore – The Next Chapter in Hotels and Tourism’ released in 2017 noted that in 2017, just over 3,000 new hotel rooms will enter Singapore leading to an increase of approximately 5% on existing rooms.
The report said:
“The bulk of this new supply comes from the midscale market (37%) followed by the upscale market (33%). The growth of both markets is in line with a structural shift in corporate accommodation requirements via new employment industries growing in prominence. These new industries include financial technology or ‘FinTech’, where professionals in this sector often have lower corporate travel budgets preferring both midscale or upscale hotels as opposed to luxury.
More ‘affordable luxury’ hotel brands are now making headway in Singapore as they embark on a spate of new launches. Affordable luxury hotels are increasingly common as the concept of luxury democratises. According to a report by Euromonitor, affordable luxury has emerged as a growing sector – a result of the upscaling of mass market accommodation options and the anti-premiumisation of the traditional luxury market.
The ‘luxury’ segment (28% of new supply) is also notable. New entrants to the market will include Sofitel Singapore City Centre, The Duxton Club-House, a Luxury Collection Hotel, the InterContinental in Roberston Quay and an Andaz located in Bugis – the first Hyatt-operated hotel in Singapore since the Grand Hyatt in Scotts Road opened in the early 1970s.
New entrant Yotel will open with 600 ‘cabin’ rooms in Orchard Road in September 2017. A growing number of similar-styled hotels have opened in recent years across Asia to cater for the rise in single travellers looking for lower-priced fully-equipped rooms at an affordable nightly rate. This hotel concept offers opportunities to socialise with other guests in shared leisure facilities. This is the first foray of the Yotel brand in the region.
Looking forward, new room supply into Singapore is expected to taper down significantly in 2018. It has been around three years since Singapore’s government released land for future hotel development under the Government Land Sales (GLS) programme and given current sentiment, new plots for hotel development are unlikely.”
The report noted that in terms of room supply, the market is nearing the end of a protracted rise in new hotels.
“Known new hotel projects post-2018 suggest substantially slower hotel supply growth longer term. Market commentators have been quick to highlight an apparent ‘oversupply’ in the city but it should be noted that occupancy has still comfortably withstood rates above 80% over the last year.
Overall, Singapore’s hotel and tourism outlook is positive long term. Trading performance has compared favourably to many regional hub markets and it won’t be long before demand and supply are back in balance.”
As a haven for long-term investment, strong trading performance and capital appreciation in terms of hotels, Singapore is well sought after amongst investors seeking hotel ownership within the region. However, despite the significant interest, deals have been limited in recent years because of the lack of opportunity to acquire properties.
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