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InterContinental Hotels to add brands, rooms to local market

SINGAPORE — InterContinental Hotels Group (IHG) is embarking on an Asian expansion spree with a keen focus on Singapore, the regional head of the hospitality giant said yesterday, even while analysts warned that an increase in room supply will weigh on the sector here.

InterContinental Hotels is planning to introduce three more brands from its portfolio in Singapore. Photo: Reuters

InterContinental Hotels is planning to introduce three more brands from its portfolio in Singapore. Photo: Reuters

SINGAPORE — InterContinental Hotels Group (IHG) is embarking on an Asian expansion spree with a keen focus on Singapore, the regional head of the hospitality giant said yesterday, even while analysts warned that an increase in room supply will weigh on the sector here.

IHG plans to introduce three more brands from its global portfolio — Kimpton Hotels and Restaurants, Staybridge Suites and Even Hotels — in Singapore, while adding more capacity to the brands already present in the local market.

The hospitality group’s existing brands in the Republic include InterContinental Hotels & Resorts, Holiday Inn, Holiday Inn Express, Crowne Plaza Hotels & Resorts, and Hotel Indigo.

“We have three Holiday Inn Express hotels. Singapore is a market that can take in about five to eight hotels in this segment. We are looking at opportunities to get Crowne Plaza to the centre of Singapore, growing beyond the one at Changi Airport. The only brand we don’t see expanding in the near future in Intercontinental,” said Mr Jan Smits, CEO, IHG Asia, Middle East & Africa.

In a previously announced expansion, the group will open Singapore’s second InterContinental hotel at Robertson Quay in the final quarter of this year, taking the group’s room capacity in the city to 3,270 across nine properties. Among IHG’s other brands, Hualuxe Hotels and Resorts caters specifically to China while its Candlewood Suites brand is yet to enter Asia.

“We have had incredible growth in Singapore over the past three to four years in terms of room supply. It is all about the industry cycle. At the moment, not much construction of new rooms is happening here, it will slow until demand catches up again,” said Mr Smits. “We are confident that the Singapore market will remain strong as it continues to have a strong demand of leisure and business travellers that other regions would be envious of. Even though the markets are slightly softer, we see our occupancy rates at an average of 85 per cent.”

OCBC Investment Research analysts pointed to a report from global hospitality consultancy Horwath saying hotel room supply in Singapore is expected to grow by 4 per cent this year and 1.7 per cent next year.

“We believe this may put a slight damper on the RevPAR (revenue per available room) rebound we expect in 2018,” the analysts said. “We generally expect leisure demand to remain healthy into next year, but note that corporate demand seems to remain weak, albeit slightly better compared to last year. We see the strength of corporate demand as the key variable going into 2018.”

IHG is expanding aggressively across Asia in its key markets of China and India, as well as boosting its presence in Jakarta, Manila, Bangkok, Osaka and Tokyo. In China, IHG has 300 hotels, with 200 more in the pipeline. In India, it is planning to double its presence to 60 properties.

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