But travelers have turned more cautious in spending.
Notwithstanding a slow start, DBS believes Singapore¡¯stourism sector in 2013 continues to hold promise with theopening of new major attractions
like the Marine Life Park,River Safari and the International Cruise Terminal anchoringSingapore as a regional holiday destination. Moreover, our top visitor markets like Indonesia and China (c30% of totalvisitors), continue to grow strongly. It expects visitorarrivals to grow 7.7% to 15.3m
in 2013 vs the expected 14.2m visitors in 2012. Here's more from DBS:
New rooms added; industry occupancy levels toremain fairly stable. We expect the operatingenvironment to remain competitive coming from 4,028 newrooms
(1,572 rooms in 2012, remaining 2,456 rooms over2013). Despite that, our base case scenario of 15.3mvisitors should translate to record stable occupancies
ofc83%. Upside will hinge on the average length of stay (LOS)profile, which could increase if visitors extend their holidaysto cover the full range of attractions
available. We estimatethat a 0.1 day extension in the LOS results in a 2 pptincrease in occupancy rates.
Moderating trends in recent months points to weakervisitor spending. After a strong start in 2012, we sensethat travelers have turned more cautious in spending fromthe (i) weaker average spending per visitor in recentquarters and (ii) the relative weakness in the luxury andupscale hotel segments, implying that travelers, are tradingdown to cheaper accommodation. Thus, going forward,with competition from newly opened hotels, we expecthoteliers to focus on maintaining occupancies and seelimited opportunities in raising average daily rates (ADRs).
We expect the industry to record a 3% y-o-y growth inRevPAR (vs 5% before) in 2013.
