Taipei – The latest Taiwan Tourism Bureau data show visitor arrivals from mainland China have declined for 14 consecutive months as a result of cooling cross-strait ties. With the decline in Chinese tourists likely to persist, CBRE expects that there will be an increase in medium sized hotels put up for sale, mostly located in central and south part of Taiwan, according to CBRE Taiwan’s latest Market Flash.
The latest Taiwan Tourism Bureau data show that visitor arrivals to Taiwan decreased by 5.7% y-o-y to 5.12 million in H1 2017, due mainly to a 40.1% y-o-y decline in Chinese visitor arrivals. Visitor arrivals from mainland China have declined for 14 consecutive months as a result of cooling cross-strait ties.
The decline in Chinese visitor arrivals has hit the hotel sector. Tourism Bureau data show that tourist hotels across Taiwan recorded an average occupancy rate of 63% in the first five months of 2017, a decline of 3.7 pps, while the average daily rate (ADR) decreased slightly by 0.9% y-o-y.
With the decline in Chinese tourists likely to persist, CBRE Taiwan expects that there will be an increase in medium sized hotels put up for sale, mostly located in central and south part of Taiwan.
“Some local developers may show interest in such assets as part of their land banking strategy. Business hotels located in municipal cities are more likely to attract a few domestic hotel chains still in expansion mode. On the other hand, international hotel groups may adopt a more conservative attitude towards expansion in light of the uncertain outlook. Nevertheless, selected Japanese hotel brands will remain keen on investment opportunities in Taipei to capitalize on stable demand from Japanese visitors, “ said Ping Lee, Associate Director, CBRE Taiwan Research.
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