The 2018 edition of the Hospitality Valuation Index (HVI) – Asia Pacific (APAC) comes to light amidst economic rebalancing, political changes, natural occurrences, and uncertainties across the region, while 2016 was a bearish year, 2017 saw the recovery in majority of the region’s economies, backed by an upswing in global growth, improving commodity prices and private consumption.

Despite the eventful year(s), HVS endeavors to capture and reflect fundamental and inherent changes irrespective of excessive exuberance or paranoia.

With change being the only constant, it comes as no surprise that the past two years have ushered in an era of changes and uncertainties for the region. Once APAC’s largest supporter, the United States of America has reduced their economic engagement with the APAC since Donald Trump’s election into office.

In contrast, China has played an increasingly important role with President Xi repeatedly emphasizing further cooperation and integration in the region. However, geopolitical tension and slowdown in the China’s economy has continued to put downward pressure on regional economies. Pressures were further compounded by oil prices bottoming out in 2016.

In 2017, the momentum swung for the region as oil prices recovered and global business sentiment improved. In North Asia, the region’s second largest economy, Japan, recorded eighth consecutive quarter of growth, helped by increasing private consumption, improvement in business sentiment and accelerating inflation.

Similarly, South Korea’s economy expanded at its fastest pace in three years. However, their diplomatic feud with China over a missile defense system negatively affected its tourism industry. Southeast Asian countries: Malaysia, Vietnam, and Singapore benefited from the strengthening of domestic and external demand and saw an accelerated pace of economic expansion over 2016.

Despite a series of unfortunate events in Indonesia, including terrorist attacks, multiple volcano eruptions and earthquake, their economy remained resilient achieving growth of 5%, in line with 2016. Elsewhere in Australia, despite growth slowing in 2017 on the back of reduction in net exports, particularly in rural goods and tourism, the economy continues to grow at a solid pace. However, the subdued mining industry in Perth continues to put downward pressure on the state.”

Market Value Change

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About Jeremy Teo
Jeremy Teo Jeremy Teo is an Analyst with HVS Singapore. He graduated with a Bachelor of Science degree in Real Estate from National University of Singapore. He has conducted numerous valuation and feasibility assignments across regional markets that includes Australia, Indonesia, Japan, Malaysia, Maldives, Papua New Guinea, Vietnam and Singapore. For further information, please contact: jteo@hvs.com

About Ho Mei Leng
Ho Mei Leng Ho Mei Leng is the Associate Director with HVS Singapore and she brings with her professional real estate experience of some 20 years to the firm. Apart from Sales and Marketing, she has experience in the hotel and hospitality advisory services including market and feasibility studies, operator search, market studies, operator search, market research and valuations. For further information, please contact: mlho@hvs.com

About Hok Yean CHEE
Hok Yean CHEE Hok Yean CHEE is the Regional President of HVS Asia Pacific. She has 30 years of experience in more than 30 markets across 19 countries in Asia Pacific, providing real estate investment advisory services for a wide spectrum of property assets. Her forte lies in providing investment advisory on hotels and serviced apartments including brokerage, strategic analyses, operator search, market feasibility studies, valuations and litigation support. For further information, please contact: hychee@hvs.com