Tourism in Indonesia is moving away from its old destination Bali and towards other parts of the country that are attracting more and more investments by luxury hotels. In a recent podcast interview on the Costar News Hotels program, Jesper Palmqvist, the Regional Vice President, STR Asia-Pacific, pointed out how Indonesia has become an attractive market for luxury hospitality projects. According to Palmqvist, there has been much activity concerning luxury hotel development in Jakarta and other major cities of Indonesia where room rates continue to grow and bring better profits to hotel owners.
“Luxury hotels also keep developing in Jakarta,” said Palmqvist. “The growing room rate is making good returns.” Whereas he believes that the swift rise in rates for luxury hotels will at some point come to a halt, Palmqvist remains positive regarding the country’s future potential. According to him, this is due to Indonesia’s robust entrepreneur culture and continuous development projects that provide the basis for further growth in this industry.
In addition to Indonesia, Palmqvist also talked about change in the hotel market of Japan. Although there are fewer tourists from China, Japan has proven to be a very strong nation that has managed to attract tourists from a wide variety of international places.
There have been different situations for various destinations. Tokyo has been favored because of the capacity to attract Westerners and having high average daily rates, whereas western Japan such as Osaka has not performed well due to change in traditional source markets. Palmqvist also mentioned that different kinds of tourists travel differently. It means that although the Chinese tourists travel for a short period of time and favor midscale hotels, the American tourists stay longer and prefer luxury hotels.
It seems like tourism demand continues to change in Asia-Pacific and the growing luxury hospitality industry of Indonesia continues to position the country as one of the most favorable hotel investments in the region.
