Penang hotels expecting higher demand for rooms

Hotels in Penang are expecting to report record-breaking numbers for last year, as the hotel occupancy rate for 2013 is expected to hit close to 70%, the highest in the past five years, paving the way for a strong Visit Malaysia Year 2014.

Till November last year, hotels in Penang registered an occupancy rate of 65.79% and the sales of some 1.8 milllion room nights, compared to 60.28% and 1.6 million achieved in the same period of 2012.

Andy Fong, vice-chairman of the Malaysian Association of Hotels (MAH) Penang Chapter, said the industry is confident of achieving an occupancy rate of around 68%, very close to 70%, for last year.

Previously hotel occupancy in Penang hovered around 55% to 60% annually.

For the eleven months to November 2013, city hotels in George Town saw a higher occupancy rate of 67.92% on sales of over one million room nights compared with the 65.22% occupancy and 607,744 room nights for beach hotels.

MAH expects at least a 10% increase in hotel occupancy rate for 2014, according to Fong.

“Previous trends also show that domestic arrivals contibute to about 40% of the occupancy rate, while European tourists dominate the arrival figures.

“Since about three years ago, we have seen more hotel rooms sold to domestic tourists, and higher arrivals from Asean and Asian countries.

“Domestic tourist arrivals to Penang, for example, now comprise 50% of the total tourist arrivals.

“Arrivals from the Asean and Asia easily make up more than half of the foreign tourists,” Fong said.

Singapore, Indonesia, China, India, and the Middle-East contribute the highest number of visitors.

“Visitors from Australia, the UK, Holland, and the US top the non-Asian visiting countries,” he said.

Fong said the new routes of budget airlines such as Hong Kong Express, connect directly from Hong Kong to Penang. Malindo Air, flying to Penang via Kuala Lumpur, also helped to boost tourist arrivals.

Dragon Air will also start flying from Hong Kong to Penang in April this year, he added.

When the Subterranean Penang International Convention and Exhibition Centre (SPICE) starts operating in 2015, MAH expects a an increase in visitors from the meeting incentives, conventions, and exhibitions (MICE) market.

“There will be a shortage of hotel rooms. There are currently over 14,000 rooms from the 52 members of MAH (Penang).

“While there are four major hotels on the way that will provide another 600 to 700 rooms, only one is confirmed to start operations this year, which is Royale Bintang Penang.

“The Rice Miller Hotel, St Giles, and the Cititel Express are likely to start operations in 2015 or 2016,” he said.

Penang Global Tourism managing director Ooi Geok Ling said from January to November 2013, the visitors flying directly to Penang International Airport rose 7% to 601,920 from 550,408 in the same period of 2012.

“The highest number of Asian visitors came from Indonesia, Singapore, and China. The weakening of the ringgit and the political instability in Thailand helped to boost the number of tourist arrivals in Penang,” Ooi said.

The number of Indonesian visitors increased to 263,799 during the 11 months from 215,054 in the same period a year ago, while Singaporean and China tourists increased respectively to 112,801 and 50,726, compared to 85,577 and 40,605 in the same period a year ago.

Meanwhile, Michael Saxon, Eastern Oriental Bhd’s director for hospitality and lifestyle, said Eastern Oriental Hotel and Lone Pine Hotel, set a new record in terms of room-night sales for 2013.

“The Eastern Oriental Hotel, for example, sold 44,639 rooms, last year, compared to 25,325 in 2012.The occupancy rate went down to 63.7% in 2013 compared to 69.4% the year before because we added 122 rooms in early 2013, increasing the total number of rooms to 222,” he said.

Lone Pine Hotel sold 22,296 rooms in 2013, compared to 20,028, achieving an occupancy rate of 67.3%.

“For both hotels, it was the best in a five-year period. The breakdown for Eastern Oriental Hotel was 30% domestic tourists and 70% international visitors.

“Some 40% of the arrivals were here for MICE functions, while the remainder for leisure. Tourists from Australia, New Zealand, UK, Europe, and Japan topped our list of visitors,” he added.

The Lone Pine Hotel, located in the Batu Ferringhi beach area, saw 51% international arrivals, and 49% domestic visitors, according to Saxon.

“Most of Lone Pine Hotel guests were here for leisure.

“For the Chinese New Year holidays, we are expecting over 90% occupancy for both hotels,” he said.

G Hotel sales and marketing director Kevin Cheah said the occupancy rate of the hotel is expected to grow to over 90% in 2013, a 1% rise from 2012.

“The guests were largely international arrivals, who are here for leisure. We registered the highest occupancy rate since opening for business in 2007,” Cheah added.

Penang hotels expecting higher demand for rooms