Lodging in Asia Pacific

August 2021

Travel restrictions imposed in order to limit the spread of Coronavirus (COVID-19) had a dramatic impact on lodging in 2020. Global travel came to a halt as countries around the world closed their borders, with demand for domestic trips also hit by local restrictions and social distancing measures. Ongoing concerns about the virus and the uncertain economic outlook were expected to continue to exert downward pressure on demand even as official restrictions on travel were eased.

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Key Findings

Lodging recording growth…

As investments continued to be seen in transportation infrastructure and lodging facilities, as well as the continued growth of Airbnb and local short-term rentals players in the region, lodging sales were recording consistently positive annual growth in Asia Pacific over the review period.

…until COVID-19 hits the region

However, 2020 resulted in an unprecedented decline in the region’s lodging sales as the travel industry was rocked by the pandemic. Travel, including lodging, was one of the worst-affected industries by the virus and the measures implemented to contain its spread. This saw, for example, the lodging occupancy rate in China fall close to zero in February 2020.

Pandemic helps drive digitalisation

Enhancing digitalisation strategies will be a key factor in 2020-2025. COVID-19 familiarised growing numbers of consumers with online channels for a wide range of needs, their convenience, competitive pricing and reduced risk of public exposure to the virus. Lodging players will therefore need to work on making their websites and apps effective touchpoints and booking channels.

Short-term rentals remain strong

Short-term rentals was the most dynamic area in the lodging industry in 2015-2020, which is expected to remain the case over the forecast period. In China, for example, increasing investment from Airbnb, which is implementing a localisation strategy in the country, and Xiaozhu, a leading local player in short-term rentals, will support expansion between 2020 and 2025.

Recovery expected over the forecast period

After 2020’s sales slump, lodging is expected to quickly rebound in the region over the forecast period. While, initially, domestic travel(lers) will be a key focus for industry players, as borders reopen and international tourism begins recovering, this should guarantee healthy growth rates throughout 2020-2025.

Introduction

Scope
Key findings

Regional Overview

Asia Pacific the region with the highest sales level
Quick return to positive sales growth expected from 2021
Pandemic disrupts key Lunar New Year festive season in China
Short-term rentals record an impressive 2015-2020 CAGR
Budget and unrated hotels hit hard by COVID-19 in 2020
Pandemic expected to speed up the digitalisation of lodging

Leading Companies and Brands

Extremely fragmented competitive landscape
Airbnb continues gaining share in 2020
China dominates the earnings for the top 10 companies
Airbnb and GreenTree Inns remain numbers one and two

Forecast Projections

Strong rebound expected from 2021…
…but no return to pre-pandemic sales levels until 2024

Country Snapshots

China: Market context
China: Competitive landscape
Hong Kong, China: Market context
Hong Kong, China: Competitive landscape
India: Market context
India: Competitive landscape
Indonesia: Market context
Indonesia: Competitive landscape
Japan: Market context
Japan: Competitive landscape
Malaysia: Market context
Malaysia: Competitive landscape
Philippines: Market context
Philippines: Competitive landscape
Singapore: Market context
Singapore: Competitive landscape
South Korea: Market context
South Korea: Competitive landscape
Taiwan: Market context
Taiwan: Competitive landscape
Thailand: Market context
Thailand: Competitive landscape
Vietnam: Market context
Vietnam: Competitive landscape
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