Major hotel markets recorded relatively solid performance in H2 2019. However, the COVID-19 outbreak has cast a shadow over the Asia Pacific economy in the opening months of 2020, posing a downside risk to global growth.
The short term impacts on the regional hotel market have been significant and continue to evolve along with the development of the disease. A sharp decline in visitor arrivals resulting from travel restrictions is already impacting the hospitality sector.
As of mid-March, occupancy in many hotels is in the single digits, leading owners to implement cost-saving initiatives or close temporarily for refurbishment. Some hotels have reportedly closed completely while others will struggle to ride out this challenging period.
Asia Pacific hotel transaction volume registered approximately US$15.8 billion in 2019, an increase of approximately 10% over 2018. However, the COVID-19 outbreak is expected to have a considerable impact on purchasing activity in the short term.