Strong tourism numbers in Bali are creating additional demand for hotel rooms, and the supply is increasing as government pushes for further tourism acceleration.

According to Colliers Quarterly Q2 2017 Bali Hotel report, hotel occupancy climbed in Q2 2017 to above 65%, underpinned by a considerable amount of supply, increased number of inbound tourists through the airport and a number of MICE activities (Meeting, Incentive, Convention and Exhibition). The government has boosted efforts in accelerating tourism and campaigning Indonesia to the world, with a number of hospitality and tourism conferences, and progressive advertisements through various media. And the number of Chinese tourists increased by 59.6% YoY from 386,096 to 511,773.

At a glance:

• The total supply of hotels in Bali is now 57,065 rooms
• Another 918 new rooms are expected by the end of 2017
• Room supply in Q2 2017 is 13% lower than that in Q2 2016
• The number of tourists, up to April 2017, increased by 23.6% YoY

Click here to access and download the full Colliers report​.

Since March, occupancy performance has been in the upward trend, in line with the general hotel trend for the last four years. Colliers foresees the trend for the full year 2017 is quite predictable particularly because the holiday seasons in Bali have followed the same pattern for several years. In April and May 2017, there were so many national holidays, most of which landed on the end or early part of the week. This resulted to an impressive performance. Because the holidays were national in nature, most of the visitors were local tourists. Furthermore, Ramadan took place at the end of May, and some people decided to go on holidays before Ramadan.

Just like occupancy, the ADR figures this year emulate last year’s figures although it was still below the figures in 2014 and 2015. A considerable amount of new supply in flux during the quarter, as well as the increasing number of tourists, might help stabilise market condition. Room supply in Q2 2017 is 13% lower than that in Q2 2016. Correspondingly, the number of tourists, up to April 2017, increased by 23.6% YoY.

Bali is one of the densest areas with hotel developments in Indonesia, with 521 star-rated hotel projects.

The biggest international star-rated hotel operators in Bali:

• Accor operates 21 hotels in Bali offering a total of 3,847 rooms
• Marriott International has 15 hotels offering 3,110 rooms
• Archipelago International has 15 hotels, managing 2,067 rooms
• Marriott has 11 hotel projects and a total of 2,276 rooms

In the 3-star and 4-star categories, Accor is managing eight 4-star hotels with 1,582 rooms and seven 3-star hotels with 1,026 rooms. As for budget accommodation, the supply is relatively stagnant with no new budget hotel completed since Q1 2017. Total budget hotel stock remains at 3,258 rooms from 29 hotels.

Several international airlines plan to open additional routes to Ngurah Rai International Airport. Qantas and Garuda Indonesia Airlines will have more flights to capture the Australian market better. Furthermore, Qatar Airways and Emirates are also planning to add more flights to Bali in the third quarter this year.

Source: Colliers International Indonesia – Research

By the end of June, Barack Obama and his family visited Bali for several days. This trip coincided with a major effort by Indonesia’s Tourism Ministry to promote travel to the country, especially from the United States. From 2010 up to 2016, the number of tourists from the US steadily increased. However, the growth was limited when compared to the growth of inbound tourism from India and China. In the next couple of months, Bali will anticipate a peak period until August and is expecting more tourists for the summer holiday.

For more detailed information about the Collier's Bali Hotel Report, call or email Ferry Salanto, Senior Associate Director, Colliers Research via the contact details below.

Source: Colliers International

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