Thursday, October 2, 2025

Hotel property outlook bullish over the long-term

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While the hospitality industry was one of the most heavily affected sectors in 2020, hotel operators are optimistic the sector will soon transition to a period of recovery, according to property consultancy JLL Philippines.

“Most hotels operators are trying to determine the best estimated return of airline traffic.

Hotels definitely see tourism picking up as soon as flight restrictions are lifted–it is only a matter of timing, which is heavily dependent on the roll-out of the COVID-19 (new coronavirus 2019) vaccine. Local tourism and staycations are also being encouraged to push demand,” said P. Ryan Isip, JLL Philippines’ head of Capital Markets in a statement.

“We are already seeing opportunities in the market for opportunistic acquisitions. Several groups are already looking for this type of transactions, typically management contracts in core locations,” Isip said.

In its 2021 Real Estate Market Overview webinar, JLL Philippines said hotel operators are constantly exploring ways to stay in business while mitigating high operational costs. Many hotels are operating as quarantine facilities which make them fare better than hotels that are not accepting bookings from high-risk individuals.

The Philippine outlook mirrors the sentiment in the Asia Pacific.

According to the survey, approximately 70 percent say they are bullish on the Asia Pacific hotel market and are interested in deploying capital into the sector in 2021.

JLL is forecasting approximately $7 billion in transactions in 2021, an increase of 20 percent year-on-year, up from $5.8 billion in 2020. While sizable pools capital are ready to be deployed, pricing and financing will become a larger consideration for investors.

Over 80% of investors surveyed are eyeing discounts of 20 to 30%, while sellers are expected to move roughly 10% in asking prices.

As optimism around recovery builds, Japan (52%) and Southeast Asia (46%) are emerging as the most desirable hotel investment markets in Asia Pacific, owing to strong demand dynamics and positive long-term fundamentals. Investors also view Australia (31%) and China (22%) favorably.

“The cycle has been reset and we are now on the cusp of a period of recovery. Optimism around the deployment of vaccines and an eventual recovery in tourism has started to drive activity and investors don’t want to miss the opportunity. At the same time record amounts of capital have been raised to be deployed into the real estate sector in general, including into hospitality,” said Nihat Ercan, senior managing director, head of Investment Sales, Asia Pacific, JLL Hotels & Hospitality Group.

Isip said JLL Philippines remains optimistic of hotel investment in the country in the long term.

“Acquisitions during this period should be opportunistic and investing while the hospitality sector is under pressure will yield good results in the long run.”

JLL polled approximately 100 clients in late January 2021. Learn more in JLL’s global Hotel Investment Outlook.

Meanwhile, JLL Philippines said it has been ranked as the leading investment advisory firm in the country with 48 percent market share in 2020.

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