Investors bullish on hospitality industry

MAJOR players in the Philippine hospitality industry remain optimistic despite challenges in recovering to pre-pandemic levels. This was revealed in the first Philippine Hotel Investment Outlook Survey, an initiative of Leechiu Property Consultants (LPC) and the Philippine Hotel Owners Association Inc. (PHOA).

Alfred Lay, LPC director for Hotels, Tourism and Leisure, and Benito Bengzon Jr., PHOA Inc. executive director, in their joint message in the report, said survey results showed «a notably bullish sentiment among investors.»

The objective of the new survey was to examine the investment appetite around the country and gain perspective on their preferred strategies and markets for 2024 and beyond, Lay and Bengzon said.

The respondents in the survey were comprised of hotel owners, investors and senior management, with a cumulative total inventory of over 10,000 hotel rooms in properties located in all major Philippine cities and from hotel market segments that covered luxury, upper upscale, upscale, upper midscale, midscale and economy.

The Philippine Hotel Investment Outlook Survey showed that a high 89 percent of respondents expressed confidence in the medium-term growth of the hospitality industry. An overwhelming 95 percent believed that the industry would flourish in the long term after a period of three years and beyond.

However, the outlook on the hospitality industry's short-term prospects was more subdued and cautious. Respondents expressed mixed feelings, citing inflation driving up the costs of transportation, goods and services, impacting tourists and hotels, and geopolitical risks. In 2023, hotels were just beginning to restore full operations while investors sought to recover from pandemic-related losses.

Some 39 percent of respondents indicated the upper midscale hotel segment as the most attractive opportunity. The figure was not surprising, according to the report, in light of the surge in developer activity in the provinces and new township developments.

In terms of cities and provinces, Bohol was the top bet of investors, with 41 percent of respondents ranking the island province highest.

Factors that gave Bohol the advantage over