Hotels & Hospitality Group | May 2017 Destinations Asia Pacific 1 Hotel Destinations – Asia Pacific

Auckland Quick Facts OCC ADR RevPAR International Visitor Arrivals (NZ 2016) Number of New Rooms (2017) 86.6% NZD 191 NZD 166 3.5 million 663 rooms

Tourism Demand New notable Auckland International Airport, which is the Auckland reported an average occupancy ‘gateway’ for Auckland and New Zealand level of 86.6% for the period year ending Jet Inn Extension, overseas visitors, has experienced strong March 2017, the highest occupancy level on Auckland International Airport growth. For the period YTD December record in over 20 years. Auckland’s market 60 rooms 2016, total passenger movements have occupancy has risen every year since 2010, increased 12% with an increase recorded in after reaching a post-GFC low of 69.5% in Swiss-Belsuites Victoria Park domestic passenger movements, up 12.5% 2009. FIT and Corporate business dominate 40 rooms and international passengers increasing the business mix of Auckland hotels by 11.5%. International visitor arrivals to contributing 47.5% and 20.5% of hotel guest New Zealand reached 3.5 million for the nights respectively, y-o-y to March 2017. period year ending February 2017, a 10.7% International sourced guests accounted for Upcoming hotels improvement over the corresponding prior 45% of guest nights sold, while domestic year period. guests accounted for 55%. Hobson Street Hotel Park Auckland M Social Auckland (former Copthorne Hotel Auckland Harbourcity) The Sebel Auckland Manukau Supply Outlook Seven projects (comprising a total of 1,291 We anticipate that Auckland’s rooms) are currently under construction accommodation market will continue to Notable hotel deals and are forecast to enter the market over perform strongly in the short term and is the next two years, with five of the hotel poised for further rate growth and to solidify Christchurch projects (818 rooms) comprising 5-star recent gains in occupancy levels given the product. The seven new hotel projects current capacity constraints, although Christchurch represent an approximate 20% increase in ultimately the ‘wave’ of new supply is likely room supply, which is an unprecedented to ease capacity constraints in the medium level of stock. However, as the room term (between 2018 – 2019). Beyond the supply is expected to enter the market in a short term some caution is warranted as staggered manner (over a two to three-year the market begins to absorb the forecast period), this should alleviate some concerns significant levels of room supply, which of an oversupply shock. ultimately is expected to soften the current historic high occupancies (above 80%) with levels likely to revert in the medium to longer term to the mid-70% range.

Note: Auckland Hotels refer to Marketwide Source: Tourism Industry Association, Statistics New Zealand, JLL ADR – Average daily rate, RevPAR - Revenue per available room, OCC - Occupancy Hotel Destinations – Asia Pacific 2

Bali Quick Facts OCC ADR RevPAR International Visitor Arrivals (2016) Number of New Rooms (2017) 66.4% USD 146 USD 97 4.9 million 3,892 rooms

Tourism Demand Total visitor arrivals were 4.9 million in As of YTD March 2017, Mainland China was New notable hotels 2016, representing an increase of 22.5% Bali’s largest source marketing, contributing compared to 2015. As of YTD March 2017, 29.6% of total visitor arrivals. This is Mövenpick Resort & Spa Jimbaran international visitor arrivals continued followed by Australia contributing 19.8% an upward trend, increasing 22% y-o-y to of total visitor arrivals. Mainland China Wyndham Resort Tamansari Jivva reach 1.3 million visitors. For the full year saw the largest y-o-y increase of 58.6%, Sthala Ubud Bali 2017, the Bali Provincial Tourism Agency underscoring the burgeoning Chinese travel is targeting approximately 40% of the demand in Asia. Despite travel advisories, Sol House Legian targeted 15 million foreign tourist arrivals to most key source markets recorded strong Indonesia in 2017, which is approximately growth in YTD March 2017, suggesting that six million foreign tourists. Strong growth in foreign tourists are largely unfazed and arrivals can be attributed to the extension are increasingly drawn to Bali as premier Upcoming hotels of the visa waiver programme in 2015, as tourism destination. well as the improvement in air connectivity Nusa Dua to key source markets such as Greater China Fairfield by Marriott Bali Legian and Australia. The Westin Ubud Resort & Spa Six Senses Bali Supply Outlook Approximately 1,737 rooms opened in Looking forward, visitor arrivals from key Notable hotel deals 2016, representing a 9.8% y-o-y increment. source markets are expected to continue There were no hotel transactions Recent major openings in 2016 include rising. Recent improvements in air in H2 2016 the 136-room Sol House Legian, the 222- connectivity from Ngurah Rai International room Wyndham Resort Tamansari Jivva, Airport with new flight routes, ongoing the 143-room Sthala Ubud Bali and 297- improvements in airport accessibility, and room Mövenpick Resort & Spa Jimbaran. the extension of visa waiver programme In 2017, approximately 3,892 rooms should fuel the continued spike in foreign are in the pipeline. Majority of the new tourism demand in Bali. Moreover, the supply in clustered in the luxury sector recent corporation between Indonesia and (44.3%) followed by the upscale sector Chinese tourism authorities should provide (34.2%). In terms of location, most will be an added boost to Indonesia’s overall concentrated in the Nusa Dua and Uluwatu tourism sector. areas. However, it is not unusual for several projects to be postponed or cancelled due to financing difficulties.

Note: Bali Hotels refers to Upscale Source: STR Global (YTD March 2017), Bali Government Tourism Office, JLL ADR - Average daily rate, RevPAR - Revenue per available room, OCC - Occupancy 3 Hotel Destinations – Asia Pacific

Bangkok Quick Facts OCC ADR RevPAR International Visitor Arrivals (2016) Number of New Rooms (2017) 86.4% THB 3,453 THB 2,983 20.8 million 2,876 rooms

Tourism Demand New notable hotels Bangkok received 20.8 million international Mainland China remains the biggest source visitors in 2016, representing an increase of market to Bangkok, followed by Japan, Ibis Bangkok IMPACT 7.5% y-o-y, as Bangkok continues to be a India and South Korea. Bangkok has seen 587 rooms top global destination after its resurgence a slowdown in growth in visitor arrivals in 2015 from the prior year’s 2014 political from Mainland China to 5.9% growth y-o-y Grande Centre Point Sukhumvit 55 unrest. The passing of His Majesty King in 2016 from 82.5% growth y-o-y in 2015. 442 rooms Bhumibol Adulyadej resulted in a minor This comes as the government launched dip in arrivals which recovered quickly as a crackdown on zero-dollar tours in Bangkok Sukhumvit 50 businesses return to usual. Record arrivals September, leading a q-o-q drop in Chinese 171 rooms are expected in 2017 as early-year airport arrivals. Key markets which experienced statistics are already indicating growth. strong growth include USA (12.7%), Middle Eastern countries (11.1%) and India (8.2%). Upcoming hotels The Bangkok EDITION by Ritz Carlton Park Hyatt Bangkok Lancaster Bangkok Supply Outlook Notable hotel deals Since the beginning of 2017, approximately Bangkok will continue to see strong growth 800 rooms have been added to the Bangkok in visitor arrivals with ongoing airport Swissotel Nai Lert Park market with another 2,100 rooms estimated expansions to increase capacity from 45 to enter the market by year-end. Over 35% million to 60 million for Suvarnabhumi of future supply over the next four years is Airport, and from 28 million to 40 million concentrated in the upscale segment. Key for Don Mueang Airport. Higher airport new projects include ibis Styles Bangkok capacities are expected to translate to Sukhumvit 50, Grande Centre Point lodging demand and absorb the oncoming Sukhumvit 55, and ibis Bangkok IMPACT on room supply. Chaengwattana Road.

Note: Bangkok Hotels refers to Upscale Source: STR Global (YTD March 2017), Tourism Authority of Thailand, Ministry of Tourism and Sports Thailand, JLL ADR - Average daily rate, RevPAR - Revenue per available room, OCC - Occupancy Hotel Destinations – Asia Pacific 4

Beijing Quick Facts OCC ADR RevPAR International Visitor Arrivals (2016) Number of New Rooms (2017) 66.1% RMB 559 RMB 389 4.2 million 1,479 rooms

Tourism Demand Data from Beijing’s Tourism Bureau show Beijing’s hotel demand is driven by business New notable hotels the city’s international arrivals dropped travel as well as the tourism and MICE 0.8% y-o-y to 4.2 million at the end of (Meetings, Incentives, Conferences and Grand Metropark Hotel Beijing 2016. Visitors from South Korea and Japan Exhibitions) travel segments. Corporate 427 rooms decreased 8.8% and 4.0% respectively, due demand remains the major demand driver. to their slower economy and economic As Beijing is the political and commercial Grand Metropark Longxi environment. French and German travelers centre in Mainland China, a large number of Conference Center have also trended downwards by 12.3% corporates have set up their headquarters 346 rooms and 2.9% respectively. The recent fall in in Beijing, generating considerable business the euro has led to a decline on business demand. InterContinental Beijing Sanlitun activities with Beijing’s long haul trading 300 rooms partners. Tylfull Hotel 226 rooms Chao Clubhouse 180 rooms

Upcoming hotels Supply Outlook Beijing Bvlgari Hotel Just five new hotels opened in Beijing The Beijing market will benefit from in 2016, adding 1,479 rooms to the enhanced intercity transportation and Mandarin Oriental Beijing market. High-profile openings included tourism infrastructure development Hualuxe Beijing Xinan Hotel Intercontinental Beijing Sanlitun and Chao underway. Ahead of the opening of Clubhouse, both of which are located in Universal Studios in 2020 and the 2022 The Puxuan Hotel and Spa Sanlitun. Strict development restrictions Winter Olympics in Beijing and Zhangjiakou, Muji Hotel Beijing within the city centre are expected several infrastructure upgrades in and to continue to restrain future supply. around the city will support the hotel Compared with Shanghai, where round 26 sector, including two new highways linking new hotels are expected to enter the market Beijing to nearby tourism destinations, such in 2017, just nine new hotels (2,204 rooms) as Chongli, Yanqing, and Qinhuangdao. Notable hotel deals are planned for Beijing. Somerset ZhongGuanCun Beijing

Note: Beijing refers to Four Star hotels Source: STR Global (YTD March 2017), Beijing’s Tourism Bureau, JLL ADR - Average daily rate, RevPAR - Revenue per available room, OCC - Occupancy 5 Hotel Destinations – Asia Pacific

Brisbane Quick Facts OCC ADR RevPAR International Visitor Arrivals (2016) Number of New Rooms (2017) 71.5% AUD 152 AUD 109 935,000 207 rooms

Tourism Demand New notable hotels In 2016, a total of 23.1 million visitor Mainland China remains the biggest source nights were spent in Brisbane City. market to Brisbane, followed by Korea, Express Hotel International visitor nights accounted for and the United Kingdom. In 2016, 226 rooms 67.9% and domestic nights accounted Chinese visitor nights in Brisbane City for 32.1%. Domestic visitor nights in grew 14.7% year-on-year and has grown Swiss Belhotel Brisbane Brisbane increased by 5.3% y-o-y however at an average annual rate of 25.2% over 134 rooms international visitor nights in Brisbane the last 10 years. While leisure related decreased moderately by 1.6%. demand remains the primary purpose of Sage Hotel James Street visit, the employment segment increased 93 rooms significantly during 2016 in Brisbane City. Art Series Hotel - The Johnson 83 rooms

Upcoming hotels W Hotel Brisbane Southpoint Emporium Hotel Adina on George Street Supply Outlook Westin Hotel Brisbane New supply over the second half of 2016 In the short to medium term, conditions are in the Brisbane City market increased by likely to remain stagnant as further supply approximately 217 rooms or an increase of enters the market. Any notable uplift in approximately 2% on the existing stock. So performance will also be dependent on Notable hotel deals far in 2017, two hotels have opened being the extent of recovery in the corporate the Sage Hotel James Street and the Holiday and conference segment as well as Jephson Hotel Inn Express Brisbane Central. Looking growth in the leisure segment. Resource forward we are aware of a further six short sector demand may improve over the term accommodation development current medium term with renewed investment in under construction and due for completion mining infrastructure projects, however between 2017 and 2019. If all projects a timeframe on these potential trends materialise, this will represent an increase remains unclear. of 1,376 rooms or 12% on the existing stock.

Note: Hotel supply within the Brisbane City Region Source: STR Global (YTD March 2017), Tourism Research Australia (2016), JLL ADR - Average daily rate, RevPAR - Revenue per available room, OCC - Occupancy Hotel Destinations – Asia Pacific 6

Delhi Quick Facts OCC ADR RevPAR International Passenger Traffic (India 2016) Number of New Rooms (2017) 83.1% INR 5,660 INR 4,702 8.9 million 540 rooms

Tourism Demand Delhi has shown growth of 10.1% in In 2016, Delhi witnessed continued growth New notable hotels international passenger arrivals YTD in demand– largely driven by growing February 2017 from approximately 2.5 MICE and corporate demand, in addition Andaz Delhi million to 2.8 million. Foreign arrivals have to improved spending capacity and the 401 rooms recorded noticeable rises after the e-visa increased presence of low-cost air carriers. facility was introduced, now available The newly developed Delhi Aerocity Muse Sarovar Portico to over 150 countries, boosting leisure hospitality district with over 3,200 hotel 73 rooms demand from foreign visitors. The new rooms, extensive banqueting space and the visa improvements are relevant to leisure presence of significant Grade A office space, tourism including visiting friends and has seen promising demand levels. family, short duration medical treatment Upcoming hotels and business visits. Aloft New Delhi Aerocity & Suites Delhi

Notable hotel deals There were no hotel Transactions Supply Outlook in H2 2016 Andaz Delhi and the Roseate House in the The Delhi hospitality market has remained Aerocity hospitality district have been the resilient, despite the largest supply increase most notable hotel openings recently. that the city has seen in the recent past Future supply in Delhi remains fairly - in the form of the Aerocity hospitality limited due to scarcity of land and high district. While ADR levels have seen some land prices in the city and new supply will softening due to a large volume of supply be largely concentrated to the Aerocity in the Midscale to Upper Upscale segments, hospitality district. The Aerocity has been demand levels have remained strong. With a key hospitality district as its strategic hotel supply slowing and growing demand, positioning has enabled Aerocity to absorb Delhi continues to present investors with commercial, transit arrival and MICE a strategic entry into the gateway of the demand from both the Delhi and Gurgaon country. micro-markets. The Oberoi New Delhi will be closed effective from April 1, 2016, for major renovation and will reopen April 1 in 2018.

Note: Delhi Hotels refers to Delhi Deluxe Source: STR Global (YTD March 2017), Airports Authority of India, JLL ADR - Average daily rate, RevPAR - Revenue per available room, OCC - Occupancy 7 Hotel Destinations – Asia Pacific

Hanoi Quick Facts OCC ADR RevPAR International Visitor Arrivals (2016) Number of New Rooms (2017) 85.2% USD 113 USD 96 4.0 million 843 rooms

Tourism Demand New notable hotels In 2016, Hanoi saw four million international Top source markets to Vietnam include visitor arrivals, up an impressive 21.2% Mainland China, South Korea, Japan and Novotel Suites Hanoi y-o-y, and exceeding Vietnam National the USA. While continuing its promotional 151 rooms Administration of Tourism’s (VNAT) initial efforts in Japan, Hanoi also aims to expand expectations of 3.8 million. This represents its market in Russia and France through a five-year Combined Annual Growth Rate cooperation with international agencies and (CAGR) of 16.1% from 2011 to 2016. As of diplomatic representatives. In its tourism Upcoming hotels March 2017, the city has seen six million drive, Hanoi will position itself as a cultural visitors, a 7% y-o-y growth, of which over destination for its food culture and well- Novotel Ciputra Hanoi one million are international visitors. preserved relic sites. Novotel Hanoi Thai Ha Somerset West Point Hanoi

Notable hotel deals There were no hotel transactions in H2 2016 Supply Outlook In 2016, just over 200 new rooms were The VNAT continues to strongly market added to the Hanoi hotel market in addition Hanoi as a cultural destination through an to rebranded supply, however 2017 expects advertising campaign with CNN across its to see a much larger addition with over 800 international network. The campaign will branded hotel rooms to enter the market run on both CNN’s on air and online media by year-end. A further 2,000 rooms will be from 2017 to 2018. In addition to ongoing launched by 2020. Between 2017 and 2020, initiatives within Hanoi, to further enhance almost 60% of new room supply or 1,700 its tourism offerings, Hanoi looks to link its rooms will be in the luxury segment. tourism coordination with other northern localities to lengthen international length of stay. With VNAT’s initiatives expected to drive the increase in visitor arrivals the outlook for the market remains positive.

Note: Hanoi hotels refers to Marketwide Source: STR Global (YTD March 2017), Vietnam National Administration of Tourism, JLL ADR - Average daily rate, RevPAR - Revenue per available room, OCC - Occupancy Hotel Destinations – Asia Pacific 8

Ho Chi Minh City Quick Facts OCC ADR RevPAR International Visitor Arrivals (2016) Number of New Rooms (2017) 75.7% USD 117 USD 89 5.2 million 1,007 rooms

Tourism Demand International arrivals to Ho Chi Minh Key source markets to Vietnam include New notable hotels City reached 5.2 million in 2016, a 10.6% Mainland China, South Korea, Japan and growth y-o-y exceeding the government’s the USA. While continuing its promotional Ibis Saigon Airport initial expectations of an 8.5% increase. efforts in Japan, Ho Chi Minh City also aims 282 rooms Between 2011 and 2016, the city registered to expand new markets, targeting Russia a Compound Annual Growth Rate (CAGR) and India as future growth markets as the of 10.9%. The growth comes as the city city looks to grow international arrivals stepped up its efforts to enhance arrivals to near six million in 2017. The domestic Upcoming hotels and average spending with more festivals market relies on the city as a key economic with a focus on culture and eco-tourism and recreational hub with 21.8 million Ascott Waterfront Saigon as well as attending travel marts and visitors in 2016, and 24 million targeted for Ritz-Carlton Saigon roadshow overseas. this 2017. Starcity Airport Hotel Viettel Complex

Notable hotel deals There were no hotel Transactions Supply Outlook in H2 2016 2016 saw 703 new rooms added to the Named by Conde Nast Traveler as among market. As the city gains traction as an the 50 most beautiful cities in the world, international tourist destination, over 3,500 Ho Chi Minh City is fast becoming an rooms are expected to be added to the international tourist destination as the market by 2020, with 1,000 keys expected government continues to focus efforts on in 2017. While much of the existing marketing as well as improving tourist international and locally branded hotels are attractions and safety. With ongoing in the Upscale (35.4%) and Midscale (27.8%) upgrading of museums and approval for segments, upcoming additions (2017-2020) a safari and Saigon Cultural and Tourism are concentrated in the Luxury (48.4%) Village, the People’s Committee is and Upscale (42.4%) segments. Notable developing a tourism development strategy openings in 2016 include ibis Saigon Airport through to 2030 and beyond to ensure in Tan Binh District and Bay Hotel Ho Chi sustainable tourism development. Minh in District 1.

Note: Ho Chi Minh City Hotels refers to Marketwide Source: STR Global (YTD March 2017), Vietnam National Administration of Tourism, JLL ADR - Average daily rate, RevPAR - Revenue per available room, OCC - Occupancy 9 Hotel Destinations – Asia Pacific

Hong Kong Quick Facts OCC ADR RevPAR International Visitor Arrivals (2016) Number of New Rooms (2017) 83.7% HKD 1,755 HKD 1,469 56.7 million 1,022 rooms

Tourism Demand New notable hotels Total visitor arrivals declined 4.5% in 2016 Mainland China is Hong Kong’s largest compared to 2015 mainly due to the sharp source market, contributing 75.5% of all Silka Tsuen Wan decline of same-day visitors from Mainland total visitor arrivals in 2016. Over the same 409 rooms China. In April 2015, the Mainland restricted period, the number of overall visitors from Shenzhen permanent residents to just Mainland China continued to fall, down by Attitude on Granville one entry per week, which has largely 6.7% y-o-y to 42.8 million arrivals. This can 81 rooms contributed to the same-day visitor decline be attributed to the socio-political tension, of 8.7% y-o-y. On the other hand, the rate stronger local currency, tightened visa of decline in total overnight visitor arrivals policy for Shenzhen visitors, and increasing has slowed from being down 5.2% in 2015 competition from other destinations Upcoming hotels to 0.5% in 2016, showing signs that we are such as Japan and South Korea, which beginning to see improvement in Mainland drew significantly more visitors from the Kerry Hotel by Shangri-La arrivals. Mainland. Disney’s Explorer’s Lodge Rosewood Hong Kong The Murray, a Niccolo Hotel

Notable hotel deals Supply Outlook Newton Place Hotel Kwun Tong Approximately 888 rooms have been The increase in supply and economic added into the market last year, most of uncertainties are expected to limit growth Rosedale Causeway Bay which are small to medium sized midscale/ in hotel performance. 2016 has set the economy properties in Hong Kong Island stage for a relatively uncertain 2017, J Plus Hong Kong and Kowloon. So far in 2017, two hotels with ‘Brexit’ expected to limit European have opened, Attitude on Granville with 81 visitors. As a major corporate hub, Hong rooms, and the Silka Tsuen Wan with 409 Kong is always affected by global economic rooms. Approximately 6,000 rooms remain concerns and this remains still in recovery. in the pipeline. Notable openings are: However, we are cautiously optimistic that Disney’s Explorer’s Lodge with 750 rooms, hotel performance is likely to return to Rosewood Hong Kong in Tsim Sha Tsui with stabilised levels over the medium term, as 600 rooms, the Kerry Hotel by Shangri-La Hong Kong has proven itself to be a resilient with 545 rooms, and The Murray, a Niccolo city on the back of its multi-faceted appeal Hotel with 336 rooms. for FIT, leisure, corporate as well as MICE- related demand. It is however increasingly competing with cheaper Shanghai for the latter.

Note: Hong Kong refers to Upscale hotels Source: STR Global (YTD March 2017), Hong Kong Tourism Bureau, JLL ADR - Average daily rate, RevPAR - Revenue per available room, OCC - Occupancy Hotel Destinations – Asia Pacific 10

Jakarta Quick Facts OCC ADR RevPAR International Visitor Arrivals (2016) Number of New Rooms (2017) 53.8% USD 166 USD 89 2.4 million 3,193 rooms

Tourism Demand As of YTD February 2017, international Despite the recent terror attacks in Jakarta New notable hotels visitor arrivals rose by 17.5% y-o-y to reach in January 2016, overall tourism demand 373,219 visitors. Strong y-o-y growth from continued its upward trend, underpinned Westin Jakarta 2016 underpinned the recovery in tourism by strong corporate demand. This is 272 rooms confidence following the bombing attacks attributed to the fact that Jakarta remains in the Indonesian capital in January 2016, a key business gateway into Indonesia, Jakarta Cikini particularly amongst foreign tourists. which holds huge economic potential. This 207 rooms Continued benefits arising from the should continue to attract international Four Points by Sheraton extension of the visa waiver programme and domestic corporate demand into the to an additional 45 countries in 2015 also city. However, ongoing global uncertainty, Jakarta Thamrin contributed to overall visitor growth. coupled with terrorism concerns, should 164 rooms continue to weigh on tourists’ minds. Four Seasons Hotel Jakarta 125 rooms

Upcoming hotels Swiss-Belhotel Resuna Epicentrum Supply Outlook Holiday Inn Simutupang Swiss-Belhotel Kelapa Gading Approximately 1,334 rooms opened in Continued tourism promotion efforts by the 2016, representing y-o-y increment of 2.3%. Ministry of Tourism through its “Wonderful InterContinental Pondok Indah Majority of the hotel openings were in the Indonesia” campaign is expected to Central region. Major openings in 2016 improve visitation into Indonesia. With include the 125-room Four Seasons Hotel tourism identified as a key economic Jakarta, the 272-room Westin Jakarta, the driver, coupled with ongoing infrastructure Notable hotel deals 207-room Mercure Jakarta Cikini and the projects, the tourism sector should expect 125-rooms Four Points by Sheraton Jakarta to get an added boost. Approximately 9,786 There were no hotel transactions Thamrin. In 2017, approximately 3,193 rooms are in the pipeline from 2017-2020 in in H2 2016 rooms are in the pipeline. Notable openings Jakarta. in 2017 include the 312-room Swiss-Belhotel Kelapa Gading, the 323-room Swiss-Belhotel Resuna Epicentrum, the 316-room Holiday Inn Express Simatupang and the 300-room InterContinental Pondok Indah.

Note: Jakarta Hotels refers to Upscale Source: STR Global (YTD March 2017), Singapore Tourism Board, JLL ADR - Average daily rate, RevPAR - Revenue per available room, OCC - Occupancy 11 Hotel Destinations – Asia Pacific

Kuala Lumpur Quick Facts OCC ADR RevPAR International Visitor Arrivals (Malaysia 2016) Number of New Rooms (2017) 68.7% MYR 537 MYR 369 26.8 million 2,771 rooms

Tourism Demand New notable hotels Total international visitor arrivals to Kuala Lumpur is predominantly a corporate Malaysia reached 26.8 million in 2016, market with strong weekday business, but St Regis Kuala Lumpur an increase of 4.0% compared to 2015. relatively little leisure demand and lower 208 rooms Tourism receipts rose by 18.8% y-o-y to MYR weekend occupancy. Singapore was the 82.1 billion compared to MYR 69.1 billion top source market to Malaysia in 2016 and Sunway Pyramid Hotel West in 2015. Tourism Malaysia is targeting a accounted for 13.3 million or 49.6% of all 401 rooms total of 31.8 million international tourist international tourist arrivals to Malaysia, an arrivals in 2017 with tourism receipts increase of 2.6% y-o-y. Second to Singapore of MYR 118 billion. Malaysia’s stronger was Indonesia with 3.0 million arrivals, an tourism performance in 2016 is attributed increase of 26.7% and thirdly Mainland Upcoming hotels to improved flight accessibility as well as China with 2.1 million arrivals, a significant currency depreciation making it a more growth of 9.4% y-o-y. Element Kuala Lumpur affordable destination for international W Hotel Kuala Lumpur tourists. By 2020, the vision is to achieve 36 million tourist arrivals and MYR 168 billion Four Seasons Place Kuala Lumpur in tourism receipts. Fairmont Kuala Lumpur Alila Bangsar Supply Outlook Notable hotel deals Approximately 2,200 rooms opened in 2016, Over supply of hotel rooms remains a an increase of 5.3% y-o-y. New openings key concern in Kuala Lumpur despite There were no hotel Transactions in 2016 include the 383-room Holiday Inn the Malaysian governments continued in H2 2016 Express Kuala Lumpur City Centre, the 247- commitment to promoting the city as a room Oasia Suites Kuala Lumpur, the 208- key MICE destination. It is estimated that room St Regis in KL Sentral and the 347- approximately 9,000 new hotels rooms are room The Hotel Kuala Lumpur in the pipeline between 2017 and 2022, 33% along Jalan Ampang. The majority of the of which will be in the luxury segment and new supply, or 72%, was in the midscale a further 62.4% in the upscale segment. segment, with the St Regis the only new While not all of this supply is guaranteed, luxury hotel to open in 2016. it is a concern for a city which is already experiencing significant pressure on rates and occupancy.

Note: Kuala Lumpur Hotels refers to Luxury and Upscale Source: STR Global (YTD March 2017), Tourism Malaysia, JLL ADR - Average daily rate, RevPAR - Revenue per available room, OCC - Occupancy Hotel Destinations – Asia Pacific 12

Macau Quick Facts OCC ADR RevPAR International Visitor Arrivals (2016) Number of New Rooms (2017) 85.2% MOP 1,372 MOP 1,169 31 million 2,000 rooms

Tourism Demand In 2016, international visitor arrivals to With a total of 20.5 million visitor arrivals New notable hotels Macau stayed relatively flat, improving recorded in 2016, Mainland China remained by 0.8% y-o-y to 31.0 million. The gaming Macau’s top source market, contributing The Parisian industry showed signs of recovery with data 66.1% to total visitor arrivals. Following a 3,000 rooms released by Macau’s Gaming Inspection drastic fall in 2015, the Mainland Chinese and Coordination Bureau recording gross market gained some momentum in Wynn Palace gaming receipts rising 3.1% to MOP 19.3 December 2016, growing by 7.8% compared 1,700 rooms billion in January 2017. to December 2015, ending the year with a 0.2% negligible improvement. Upcoming hotels The 13 MGM Cotai Lisboa Palace Palazzo Versace Macau Roosevelt Hotel Macau Supply Outlook According to the Macau Government Macau’s economy is driven by the gaming Notable hotel deals Tourism Office, total hotel rooms in Macau sector. However, casino operators are amounted to 37,634 rooms with a 13.9% keen to diversify into other non-gaming There were no hotel Transactions increase in supply compared to 2015. The sectors including theme parks, sporting and in H2 2016 growth in supply was contributed mainly other entertainment options as well as the by two major hotel openings in 2016: Wynn international MICE market. To attract more Palace (1,700 rooms) and at almost double visitors, the government is also improving the size Parisian (3,000 rooms). Upcoming infrastructure including the development of major supply additions include MGM Cotai the Taipa Ferry Terminal, the Macau Light (1,500 rooms) scheduled to open during the Rapid Transit and the development of a second half of 2017, and the ultra-luxury large scale integrated development zone hotel “The 13” (200 suites) scheduled to with strong finance, technology, and leisure open in early 2017. generators on Hengqin Island.

Note: Macau refers to Marketwide hotels Source: STR Global (YTD March 2017), Macao Government Tourism Office, Gaming Inspection & Coordination Bureau Macau, JLL ADR - Average daily rate, RevPAR - Revenue per available room, OCC - Occupancy 13 Hotel Destinations – Asia Pacific

Maldives Quick Facts OCC ADR RevPAR International Visitor Arrivals (2016) Number of New Rooms (2017) 69.0% USD 843 USD 582 1.3 million 1,316 rooms

Tourism Demand New notable hotels In 2016, the Ministry of Tourism launched As the leading source market to the the ‘Visit Maldives Year 2016’ campaign, Maldives, Mainland China made up about Amilla Finolhu aiming to attract 1.5 million international 29.1% of total visitor arrivals in 2015, 125 rooms visitors for the first time. As part of the approximately three and a half times that campaign, the government conducted of the second largest source market, Amari Havodda various national and international activities Germany. Growth in the Mainland Chinese 120 rooms to strengthen the Maldives’ brand and market has been remarkably fast over the market the country as an exclusive past few years, from 60,666 visitors in 2009 Furaveri Island Resort & Spa destination. As at December 2016, visitor to 359,514 in 2015. The latest tourism 105 rooms arrival numbers have increased by 4.2% numbers indicate that while Mainland Atmosphere OZEN y-o-y, aided by growth in the Indian and UK China remains the leading source market, 90 rooms source markets in particular. comprising 25.2% of the market as at 2016, overall arrivals fell by 9.8% y-o-y. Four Seasons Voavah Private 7 rooms

Upcoming hotels Zitahli Resort & Spa Supply Outlook JW Marriott Maldives According to the Ministry of Tourism, a total Despite the challenging macro environment, Centara Hudhufushi Resort & Spa of 122 resorts with 26,089 beds, 16 hotels the Maldives government remains with 1,713 beds, 373 guest houses with committed to growing and investing in its Pullman Maldives 5,509 beds and 142 safari vessels with 2,608 tourism market. The Maldives Marketing beds were registered in the Maldives as at & Public Relations Corporation launched Cheddi Dhapparu October 2016. Of the registered capacity, the ‘Visit Maldives Year 2016’ marketing 28,052 beds are considered operational, campaign early this year and has organised comprising 24,516 beds in 114 resorts, a series of trade road shows in Tier One Notable hotel deals 1,509 beds in 13 hotels, 929 beds in 58 cities in India such as New Delhi, Bangalore, guest houses and 1,098 beds in 63 vessels. Kolkata, Mumbai and Chennai. Looking Grand Park Kodhipparu New hotel openings in the Maldives are forward, while the operating market is less common compared to city or other likely to be challenging in the short term, J Resorts Kuda Rah established resort destinations because we expect that increased marketing of the high cost of construction and level campaigns, ongoing tourism infrastructure Zitahli Kuda Funafaru Resort & Spa of expertise required in operating a resort. improvements and increased airlift from Nevertheless, we are aware of five openings other markets will benefit the medium to in 2015 and a further ten in 2016, adding long term prospects of the Maldives. 1,316 rooms to supply.

Note: Maldives Hotels refers to Marketwide Source: STR Global (YTD March 2017), Ministry of Tourism, Arts & Culture, JLL ADR - Average daily rate, RevPAR - Revenue per available room, OCC - Occupancy Hotel Destinations – Asia Pacific 14

Manila Quick Facts OCC ADR RevPAR International Visitor Arrivals (Philippines 2016) Number of New Rooms (2017) 70.6% USD 107 USD 75 5.9 million 3,101 rooms

Tourism Demand Total international visitor arrivals to the As at YTD February 2017, South Korea is the New notable hotels Philippines reached 5.8 million in 2016, an biggest visitor-generating market to the increase of 12.9% compared to 2015. As at Philippines, with total arrivals of 0.3 million, Shangri-La at The Fort YTD February 2017, international visitor or 25.2%, of the total. The USA is the second 576 rooms arrivals reached 1.2 million, an increase largest market, followed by Mainland China, of 13% y-o-y. Tourism activities as at Japan and Australia. Among the top ten Novotel Manila Araneta Center YTD February 2017 generated earnings source markets, India showed the highest 396 rooms amounting to PHP 40.1 billion, down by growth of 28% y-o-y followed by Mainland 18.9% y-o-y from the 49.4 million achieved China at 25.4% y-o-y. Other markets which in the corresponding period of the previous enjoyed substantial growth were Vietnam 347 rooms year. Regionally, East Asia contributes the (+30.0%) and European countries such as Marriott West Wing – majority of international visitor arrivals to France (+27.6%) and Russia (+29.2%). Resort World Manila the Philippines, accounting for 52.6% as at 228 rooms YTD February 2017, or 0.6 million.

Upcoming hotels Supply Outlook Grand Hyatt Manila Approximately 2,429 rooms opened in 2016, Manila remains attractive to both the Sheraton Manila an increase of 7.3% y-o-y. New openings corporate and leisure markets given its Savoy Hotel Newport City in 2016 included the 576-room Shangri- status as a hub for the BPO sector and the La at the Fort in , the rapidly developing integrated resorts in Mandarin Oriental Manila 347-room Conrad Manila at the Mall of the area. Belle Corp recently Asia Complex, Phase 2 of the Marriott West announced that it is considering an Wing at , which added extension of the City of Dreams, Manila 228-rooms to the existing hotel and the 396- integrated casino resort as it is currently Notable hotel deals room Novotel Manila Araneta Center. In operating at full capacity. Belle Corp has March 2017, the Okada Manila celebrated an 8,500 square metre piece of land across There were no hotel transactions its grand opening, and the USD 2 billion from the City of Dreams that could serve in H2 2016 integrated resort casino will house over 500 as a non-gaming expansion of the resort. table games, more than 3,000 electronic The continued development of the gaming gaming machines and 993 hotel rooms. industry in Manila will help attract more leisure demand and transform the local tourism industry.

Note: Manila Hotels refers to Marketwide Source: STR Global (YTD March 2017), Philippines Department of Tourism, JLL ADR - Average daily rate, RevPAR - Revenue per available room, OCC - Occupancy 15 Hotel Destinations – Asia Pacific

Melbourne Quick Facts OCC ADR RevPAR International Visitor Arrivals (2016) Number of New Rooms (2017) 88.3% AUD 218 AUD 192 1.7 million 273 rooms

Tourism Demand New notable hotels In 2016, a total of 36 million visitor nights Mainland China is Melbourne’s largest were spent in Melbourne City representing source market, contributing 31.9% of Four Points by Sheraton 6.1% of all visitor nights in Australia. all international visitor arrivals in 2016. 273 rooms International visitor nights accounted for Melbourne’s calendar of major global events 64.5% and domestic nights accounted for and international conference program QT Hotel Melbourne 35.5%. Domestic visitor nights in Melbourne is a draw card for visitors to the city and 184 rooms increased by 11.1% y-o-y and international has contributed to the growth in the visitor nights in Melbourne increased by accommodation market. A strong calendar Punthill Northbank Melbourne 3.8% y-o-y. of international events in the second 130 rooms half of the year, including the Melbourne Stamford Plaza Melbourne Extension International Film Festival, AFL Grand Final 26 rooms as well as Melbourne Cup Carnival and Boxing Day Test Match saw leisure demand increase over the balance of the year. Upcoming hotels Ibis & Novotel Little Lonsdale Street Novotel Southbank Melbourne W Hotel Melbourne Supply Outlook During H2 2016, approximately 340 rooms Melbourne’s accommodation market has were added into the market, including experienced a robust level of growth over Notable hotel deals Punthill Northbank Melbourne (130 guest the last five years capitalising on the city’s rooms), the QT Hotel Melbourne (184 guest extensive calendar of events and the closure Novotel on Collins rooms) as well as the completed extension of the Sydney Convention and Exhibition of the Stamford Plaza Melbourne (26 guest Centre between 2014 and 2016. Melbourne Hilton South Wharf rooms). So far in 2017, the Four Points City also has a long history of investment in by Sheraton Docklands is the only hotel tourism and transportation infrastructure Docklands that has opened. Looking forward we are as well as successfully marketing of the city aware of five short term accommodation nationally and globally. Notwithstanding developments currently under construction this, the underlying market buoyancy of and due for completion by 2020. If all recent years is anticipated to moderate projects materialise, this will represent slightly over the medium term as the an increase of 1,498 rooms of 7.6% on the development pipeline continues to build. existing stock.

Note: Hotel supply within the Melbourne City Region Source: STR Global (YTD March 2017), Tourism Research Australia, JLL ADR - Average daily rate, RevPAR - Revenue per available room, OCC - Occupancy Hotel Destinations – Asia Pacific 16

Osaka Quick Facts OCC ADR RevPAR International Accommodation Guests (2016) Number of New Rooms (2017) 78.9% JPY 23,035 JPY 18,170 9.4 million 164 rooms

Tourism Demand In 2016, a total of 15.6 million visitor nights International demand remained strong in New notable hotels were spent in Osaka City. The number of Osaka in 2016, although growth has slowed international accommodation guests which as compared to 2015, mainly driven by the Premier Hotel Cabin Osaka accounts for around one third of total JPY appreciation trend that started in the (Rebranded) accommodation guests in Osaka, increased second half of 2015. Airbnb has definitively 240 rooms by 22.8% y-o-y. The number of domestic made an impact on the local hotel market. accommodation guests also increased by According to a recent Airbnb press release, Natural Hot Spring Onyado 5.4%. New rides added to Universal Studios Osaka prefecture recorded the highest Nono Namba Japan (USJ) as well as seasonal exhibitions usage rate in Japan last year. 168 rooms and events have benefited the tourism industry in Osaka. Conrad Osaka 164 rooms Hotel Trad 47 rooms

Upcoming hotels Supply Outlook Hotel WBF Yodoyabashi Minami According to Japan Ministry of Health, In January 2017, a new terminal designated Labour and Welfare, hotel and ryokan for low cost carriers commenced operation Notable hotel deals supply in Osaka City accounted 678 at Kansai International Airport and it properties (59,272 rooms) as at March 2016. is expected to boost incoming tourism Hyatt Regency Osaka There have been limited new additions numbers. The supply pipeline remains to supply of full-service hotels however, limited with the bulk of new hotels Hotel Vista Grande Osaka there were approximately 450 new and categorised as limited-service hotels. refurbished rooms that commenced Osaka is expected to witness flat trading trading. performance in 2017 as international tourism growth is expected to be the same, coming of a strong 2015-16 that was unsustainable after visa restrictions on countries including China were lifted causing record inbound numbers.

Note: Osaka Hotels refers to Marketwide Source: STR Global (YTD March 2017) Japan Tourism Agency, JLL ADR - Average daily rate, RevPAR - Revenue per available room, OCC - Occupancy 17 Hotel Destinations – Asia Pacific

Phuket Quick Facts OCC ADR RevPAR International Visitor Arrivals (2016) Number of New Rooms (2017) 87.9% THB 5,131 THB 4,512 4.0 million 950 rooms

Tourism Demand New notable hotels International visitor arrivals through Phuket In 2016, Mainland China, Russia and International Airport reached 4 million Australia remained Phuket’s top three Fishermen's Harbour Urban Resort visitors in 2016, recording an improvement source markets, according to arrivals 389 rooms of 15% over 2015. The resurgence of passing through immigration at Phuket Russian visitors was a key driver in tourist International Airport. Despite continuing Wyndham Grand Phuket arrivals. Further growth is expected in 2017 to account for almost 40% of international 214 rooms with airport statistics already indicating arrivals through Phuket, Mainland China growth in the early months of the year. In showed slower growth compared to Hyatt Place Phuket Patong September 2016, the expansion of Phuket previous years as a result of the year-end 161 rooms International Airport was completed which crack down on zero dollar tours. The fastest increased capacity from 6.5 million to 12.5 growing source market was Russia, as million per year. visitor arrivals saw a resurgence, improving Upcoming hotels 47.4% y-o-y in 2016. Rosewood Phuket The Hermitage Kata Phuket Mövenpick Resort Mai Khao Phuket (Formerly D Varee Mai Khao Beach Phuket Resort) Supply Outlook During 2017, approximately 950 rooms are Despite the halt on zero-dollar tours by expected to enter the market, of which 101 the Thai authorities, the increase in the Notable hotel deals rooms have been completed as at March number of high-value Chinese independent 2017. The west coast (including Patong, travellers and the growth of the niche Boathouse Resort on Kalim and Kamala) remains the most honeymoon market as well as a resurgence the Beach Phuket popular location for new developments, of the Russian market have all kept the comprising approximately 60% of future island’s tourism industry positive. With supply between 2017 and 2020. the rise of these new markets, we expect Phuket to benefit from a positive outlook with limited new supply.

Note: Phuket Hotels refers to Marketwide Source: STR Global (YTD March 2017), Department of Tourism Thailand, Ministry of Tourism and Sports Thailand, JLL ADR - Average daily rate, RevPAR - Revenue per available room, OCC - Occupancy Hotel Destinations – Asia Pacific 18

Seoul Quick Facts OCC ADR RevPAR International Visitor Arrivals (South Korea 2016) Number of New Rooms (2017) 71.7% KRW 95,172 KRW 68,284 17.2 million 1,362 rooms

Tourism Demand Total visitor arrivals to South Korea were As of YTD March 2017, Mainland China New notable hotels 17.2 million in 2016, representing an remained as Seoul’s largest source market, increase of 30.3% compared to 2015. As contributing 40.9% of total visitor arrivals. Namdaemun of YTD March 2017, international visitor This is followed by Japan contributing 409 rooms arrivals increased 3.2% y-o-y to reach 3.7 16.1% of total visitor arrivals. Most of the million visitors. Improving visitor arrivals key source markets experienced y-o-y Nine Tree Myeongdong II in 2016 were largely attributed to the growth in YTD March 2017. The exceptions 408 rooms record influx of Chinese tourists, buoyed by were Mainland China and Hong Kong, which Shilla Stay Guro concerted marketing efforts and the easing registered decreases of 9.2% and 3.8% of visa rules to target a growing group of respectively. The significant fall in Chinese 310 rooms Chinese independent tourists. The ongoing tourists underscore the negative impact on Aloft Seoul Myeongdong difference of opinion between South Korea South Korea’s tourism sector arising from 223 rooms and Mainland China over the deployment the ongoing THAAD dispute, in which Beijing of THAAD missile system has drastically recently banned its travel agencies from affected relations between both countries, offering travel packages to South Korea in resulting in a significant fall in Chinese March 2017. Upcoming hotels tourism demand. Lotte Signiel Hotel Seoul Encore Seoul Magok Supply Outlook Four Points by Sheraton Seoul Gangnam According to JLL estimates, approximately Investors continue to pay close attention 3,588 rooms opened in 2016, representing to the ongoing THAAD dispute, which a 5.9% y-o-y increment. Most of the recent could undermine stability in the region. hotel openings were concentrated in the Considering that Mainland China is the Notable hotel deals Myeongdong area. Recent openings include largest source market to South Korea, the 430-room Lotte City Hotel Myeongdong, any changes in relations between both Conrad Seoul the 409-room Courtyard by Marriott Seoul countries is bound to have a ripple effect on Namdaemun, the 576-room Tmark Grand South Korea’s tourism sector. Nevertheless, Belle Essence Hotel Seoul Hotel Myeongdong and 408-room Nine Tree local tourism and hospitality businesses Solaria Nishitetsu Seoul Myeongdong II. In 2017, approximately which have overly relied on Chinese visitors 1,362 rooms are in the pipeline. are currently reassessing developments, looking to attract more visitors from other countries and promoting domestic travel.

Note: Seoul Hotels refers to Midscale & Economy Source: STR Global (YTD March 2017), Seoul Tourism Board, JLL ADR - Average daily rate, RevPAR - Revenue per available room, OCC - Occupancy 19 Hotel Destinations – Asia Pacific

Seychelles Quick Facts OCC ADR RevPAR International Visitor Arrivals (2016) Number of New Rooms (2017) 75.7% USD 175 USD 132 303,000 127 rooms

Tourism Demand New notable hotels With the benefit of improving flight Last year, the top three source markets connectivity, Seychelles Tourism Board’s remained France (14.7%), Germany (13.4%) Six Senses Zil Pasyon strategy to focus on Asia to decrease and Italy (7.6%). France has traditionally 47 rooms reliance on the European market has been one of the largest source markets to worked well, evidenced by the healthy Seychelles due to its historical connection Carana Beach growth in Indian and Mainland Chinese and similar cultural tradition. However, 40 rooms visitor arrivals in the past five years. In due to France’s sluggish economy and the 2016, the Indian and Mainland Chinese cancellation of direct flights in 2011, the The Oasis Hotel & Restaurant source markets comprised together French source market has been stagnant 30 rooms approximately 8.5% of total visitor arrivals, in the past five years. However, with the which is a slightly higher proportion introduction of direct flights from Paris to compared to 2015, when the two source Mahé in 2015, the French source market Upcoming hotels markets combined comprised 7.8%. grew to 40,297 visitor arrivals. Four Seasons Desroches Island

Notable hotel deals There were no hotel transactions Supply Outlook in 2016 According to the Seychelles Tourism Board, Although Seychelles has not achieved there are around 35 large hotels with the same level of tourism growth as the 2,360 hotel rooms as at end of 2016. Most Maldives over the past few years, the of the hotels are concentrated on Mahé country has the potential to improve in the and Praslin, where air access is easier due short to medium term. Improvements in to the presence of airports. In the past, air infrastructure and accessibility will be the Seychelles hotel market supply has critical to its success, as evidenced by the been dominated by small owner-operated new direct flights to Paris and Mainland properties. However, in recent years, there China having generated a significant has been a proliferation of international increase in international visitor arrivals. A branded hotels, approximately 44.8% of likely impediment for tourism demand in the large hotel rooms are brand affiliated. Seychelles would be the spill over effect Some of the international brands include of ‘Brexit’ on the European economy, Le Meridien, Four Seasons, Hilton, especially given the country’s reliance on Avani, Raffles, Berjaya, Banyan Tree and European source markets. However, the Kempinski. increased emphasis on the Asian and Middle Eastern source markets, coupled with continued developments in infrastructure and airlift, are likely to benefit trading performance going forward. Note: Seychelles Hotels refers to Marketwide Source: Seychelles Tourism Board, JLL ADR - Average daily rate, RevPAR - Revenue per available room, OCC - Occupancy Hotel Destinations – Asia Pacific 20

Shanghai Quick Facts OCC ADR RevPAR International Visitor Arrivals (2016) Number of New Rooms (2017) 65.8% RMB 560 RMB 539 8.5 million 5,428 rooms

Tourism Demand The rate of growth in international arrivals Shanghai’s hotel demand is mainly driven New notable hotels has continued its positive trajectory. Data by the corporate sector. Shanghai is one of from Shanghai’s Tourism Bureau show the Yangtze River Delta’s major commercial InterContinental Shanghai National the city’s international arrivals climbed centers, and business travel is the dominant Exhibition & Convention Center 6.8% y-o-y to 8.5 million at the end of 2016. source of hotel demand, thanks to a steady 543 rooms Although economic and trading activities stream of visitors involved in the city’s softened in major Asian source markets, finance and service industries. The recent Disneyland Hotel-Luxury visitors to Shanghai grew including a 13.1% opening of Shanghai Disney Resort has 420 rooms increase from South Korea and a 3.1% been a boon for strong growth in domestic rise from Japanese visitors. This again tourism in Shanghai and becoming a major Shanghai Macorlink Hotel proves Shanghai’s leading position as a drawcard for regional visitors as well. 360 rooms core trading and financial hub across the Wanda Reign Shanghai Mainland. 300 rooms Le Meridien Shanghai Minhang 240 rooms

Upcoming hotels Supply Outlook Bvlgari Shanghai In 2016, a total of 18 hotels positioned in the Although Shanghai foresees an influx upscale and midscale levels commenced of room additions in the short term, we W Shanghai the Bund trading, largely driven by the opening of expect trading performance to be driven by The J Hotel Shanghai Disney Resort. Soon, Shanghai demand generated by fast city development will overtake the previous 2010 supply peak, including the expansion of city’s sub-centers The St. Regis Shanghai Jingan the year when Shanghai Expo was held. and entertainment precincts including Polar From 2017 onwards, approximately 14,000 Ocean World and a potential Lego Land Edition Shanghai rooms will be added to the market over project. New projects are concentrated in consecutive years, registering 21% growth peripheral areas such as Jiading, Songjiang on existing supply. and Chongming so we expect some pressure on room rates in the outer areas of Notable hotel deals Shanghai over the next few years. Starway Parkview South Station Hotel (70%) Amenity Garden The Mosaic Collection Grand Pujian Residence Rainbow Plaza Shanghai Note: Shanghai refers to Four Star hotels Source: STR Global (YTD March 2017), Shanghai’s Tourism Bureau, JLL ADR - Average daily rate, RevPAR - Revenue per available room, OCC - Occupancy 21 Hotel Destinations – Asia Pacific

Singapore Quick Facts OCC ADR RevPAR International Visitor Arrivals (2016) Number of New Rooms (2017) 85.3% SGD 252 SGD 215 16.4 million 2,413 rooms

Tourism Demand New notable hotels Total visitor arrivals reached a historic As of YTD February 2017, Mainland China high of 16.4 million in 2016, representing was Singapore’s largest source market, JW Marriott Hotel Singapore South an increase of 7.7% compared to 2015. contributing 21.4% of total visitor arrivals. Beach (Rebranded) As of YTD February 2017, international Mainland China also registered the largest 634 rooms visitor arrivals continued an upward trend, y-o-y increase of 15.5%. This is followed increasing 3.4% y-o-y to reach 2.8 million by Indonesia which contributed to 16.3% Holiday Inn Express Singapore Katong visitors. Continued visitor growth was of total arrivals. This is mainly the result 451 rooms driven primarily by the stronger showing of improved marketing efforts in these from Mainland China, which is now the markets, especially in the Tier 1 and 2 cities Mercure Singapore Bugis largest source market. This comes as of China, India and Indonesia. Positive 395 rooms Singapore continues to benefit from the growth in these markets helped offset the Warehouse Hotel ongoing marketing efforts by the Singapore decline in visitor arrivals in other key market Tourism Board (STB) in Tier 1 and 2 cities of such as Malaysia, Australia, South Korea and 37 rooms China, India and Indonesia. Japan, where currency depreciation and weak economic sentiments have impacted travel demand. Upcoming hotels Yotel Orchard Road Andaz Singapore Supply Outlook Park Hotel Farrer Park According to STB, Singapore’s room In 2017, STB forecasts zero to moderate Courtyard by Marriott Novena inventory comprised a total of 63,850 growth in visitor arrivals and tourism licensed rooms in 2016. Approximately receipts, targeting visitor arrivals of 4,456 rooms opened last year, a 7.6% between 16.4 million and 16.7 million. The increment over 2015. Majority of the hotel larger hotel supply pipeline may impact Notable hotel deals openings were in the Central and Eastern hotel trading performance in Singapore region of Singapore. Major openings in over the next two years. Ongoing global Cuscaden Bungalow at 2016 include the 1,500-room Hotel Boss, economic and political uncertainties as 9 Cuscaden Road 634-room JW Marriott Hotel Singapore well as increasing regional competition will South Beach, the 451-room Holiday Inn ensure that Singapore remains competitive, Express Singapore Katong and the 395- particularly in MICE and group business. room Mercure Singapore Bugis. So far in 2017, the 37-room Warehouse Hotel has opened. Approximately 2,354 rooms are in the pipeline. Majority of the new supply is in the luxury sector (39.3%) followed by the upscale sector (22.8%).

Note: Singapore Hotels refers to Upscale Source: STR Global (YTD March 2017), Singapore Tourism Board, JLL ADR - Average daily rate, RevPAR - Revenue per available room, OCC- Occupancy Hotel Destinations – Asia Pacific 22

Sri Lanka Quick Facts OCC ADR RevPAR International Visitor Arrivals (2016) Number of New Rooms (2017) 66.4% USD 111 USD 73 1.8 million 1,267 rooms

Tourism Demand Total international visitor arrivals to Sri As at YTD March 2017, India remains the New notable hotels Lanka reached 2.1 million in 2016, an top source market for international arrivals increase of 14.0% compared to 2015, falling to Sri Lanka, making up 14.0% of the Shangri-La Hambantota just short of the target of 2.2 million set by total. Arrivals from this market however Resort & Spa Sri Lanka Tourism. Total tourism revenue fell by 1.2% y-o-y. Mainland China is the 300 rooms reached USD 2.75 billion. As at YTD March second largest source market to Sri Lanka, 2017, international visitor arrivals to Sri accounting for 13.1% of the total followed Movenpick City Hotel Colombo Lanka reached 0.6 million, an increase of by the UK with 9.8% and Germany with 219 rooms 3.4% y-o-y. This is in spite of the closure 7.0%. Significant growth was seen from of Colombo’s Bandaranaike International Russia, and as at YTD March 2017 arrivals ZMAX Fairway Colombo Airport, which was closed from 6 January from Russia have grown by 24.6% y-o-y. To 191 rooms 2017 until 6 April 2017 between 08:30 and realise its tourism potential, Sri Lanka needs Ozo Colombo 16:30 to allow repairs to be made to the to significantly improve its international 158 rooms runway. The airport reopened on 7 April air and domestic road connectivity, 2017, resuming full operations. Sri Lanka hotel infrastructure and further invest in Anantara Kalutara Resort & Spa has set a target of 2.5 million international improving domestic transport, energy and 141 rooms tourist arrivals in 2017 and a long term goal telecom infrastructure. of 4.2 million by 2020. Upcoming hotels Supply Outlook Shangri-La Colombo According to data provided by the Sri Improved international connectivity to Lanka Tourism Development Authority, the key source markets such as Mainland Marriott Weligama Resort & Spa total number of tourist hotel rooms was China and the Middle East, coupled with Park Inn by Radisson Colombo 19,376 across 354 hotels, up from 18,510 improvements in domestic infrastructure rooms in 334 hotels in 2015. Tourist hotel and development of the country’s internal Cinnamon Life Hotel Colombo rooms in Colombo City increased by 9.2% road network have helped fuel demand. Sri y-o-y in 2015 and account for 20.5% of the Lanka’s continued focus as an emerging total supply of tourist hotel rooms in Sri investment destination will increase project Lanka. New hotel openings in Sri Lanka in related activities linked to new investment Notable hotel deals 2016 included the 375-room Shangri-La in port and continued infrastructure There were no hotel transactions Resort & Spa Hambantota, the 158-room development, which stimulate hospitality OZO Colombo and the 141-room Anantara demand across all sectors. in 2016 Kalutara Resort and Spa. Recent opening in Colombo include the 219-room Movenpick City Hotel Colombo and the 80-room Jetwing Colombo Seven.

Note: Sri Lanka Hotels refers to Marketwide Source: Sri Lankan Tourism Development Authority (SLTDA), JLL ADR - Average daily rate, RevPAR - Revenue per available room, OCC - Occupancy 23 Hotel Destinations – Asia Pacific

Sydney Quick Facts OCC ADR RevPAR International Visitor Arrivals (2016) Number of New Rooms (2017) 91.1% AUD 273 AUD 249 2.4 million 816 rooms

Tourism Demand New notable hotels In 2016, 37.3 million visitor nights were Sydney has benefitted from a combination spent in Sydney City which represents of a strong corporate and leisure market, Hyatt Regency (Extension) 6.3% of all visitor nights spent in Australia. a number of major sporting events, and 209 rooms International visitor nights accounted demand outstripping supply growth in for 73.1% and domestic nights 26.9%. terms of rooms built, which has resulted in Larmont Sydney (Extension) Domestic visitor nights in Sydney decreased its robust trading performance. 28 rooms slightly by 1.6% in 2016 to 10.0 million, while international visitor nights fell by 10.8% to 27.3 million. Upcoming hotels Sofitel Sydney Darling Harbour Meriton Sydney Sussex Street Sydney by Crown Suites

Notable hotel deals Park Regis City Centre Supply Outlook JLL are aware of five accommodation The outlook for Sydney’s accommodation developments currently under construction market remains strong, with a continuation in the city centre due for completion of recent trends anticipated. Both between 2017 and 2018. If all projects occupancy and ADR are at record levels materialise, this will represent an increase on a moving annual average basis, with of 1,104 rooms or 6.3% on the existing stock ADR growth expected to further improve as at 31 December 2016. We note however in line with the consistent supply outlook that in 2016 a net decrease of 338 rooms and more stable demand environment occurred which will largely offset the supply with growth across a variety of segments due to enter the market in the coming years. including corporate, cruise and inbound. Occupancy is predicted to remain in the high 80% range in the coming years, further strengthening RevPAR. The recent opening of the ICC Sydney in December 2016 will also benefit the market greatly.

Note: Hotel supply within the Sydney City Region Source: STR Global (YTD March 2017), Tourism Research Australia, JLL ADR - Average daily rate, RevPAR - Revenue per available room, OCC - Occupancy Hotel Destinations – Asia Pacific 24

Taipei Quick Facts OCC ADR RevPAR International Visitor Arrivals (2016) Number of New Rooms (2017) 68.0% TWD 7,037 TWD 4,783 10.7 million 300 rooms

Tourism Demand According to the latest statistics available, Mainland China remains as Taiwan’s largest New notable hotels total visitor arrivals to Taiwan in 2016 source market, amounting to 32.9% of reached approximately 10.7 million, up total arrivals in 2016. To cover the decline Courtyard 250,494 or 2.4% over the previous year. of the Mainland market, the Taiwanese 465 rooms With Mainland Chinese visitor arrivals government has been actively promoting declining by 16.1% over the same period, its country’s tourism in Japan and several Amba Taipei Songshan the improvement in total visitor arrivals was Southeast Asia markets. In September 189 rooms predominantly driven by the robust growth 2016, visa restrictions to Taiwan were Grand Mayfull Hotel Taipei in Japanese and Southeast Asia markets. eased for citizens of ASEAN nations, and as a result, the Southeast Asia market overall 146 rooms has witnessed a noticeable increase of Roaders Hotel Taipei leisure tourists. 68 rooms

Upcoming hotels CitizenM Ximending Taipei Royal Golden Tulip Hotel Supply Outlook Fujita Kanko Hotel Some of the notable openings in 2016 With Mainland China being the main source Renaissance Hotel included Courtyard Marriot (465 rooms), market for the country, the tourism market Amba Taipei Songshan (189 rooms), and is likely to remain challenging if cross- Grand Mayfall Hotel Taipei (146 rooms). strait tensions continue. To its benefit, Looking forward, international hotel Taiwan’s government has been diversifying Notable hotel deals openings include CitizenM in Ximending key source markets to ASEAN nations and (expected mid 2017), Aloft Taipei in Beitou Japan. Recent development plans such as There were no hotel transactions District (2018) and Taipei Royal Golden the Taipei Sky Tower project are likely to in H2 2016 Tulip Hotel (2018). The Aloft Hotel Taipei further enhance Taipei’s status as a major Beitou (292 rooms) opened in early 2017. tourism destination in Asia. According to the latest statistics available, as at the end of 2016, a total of 517 hotels with 25,477 rooms were in operation.

Note: Taipei refers to Luxury & Upper Upscale hotels Source: STR Global (YTD Jan 2017), Taipei Tourism Board, JLL ADR - Average daily rate, RevPAR - Revenue per available room, OCC - Occupancy 25 Hotel Destinations – Asia Pacific

Tokyo Quick Facts OCC ADR RevPAR International Visitor Arrivals (YTD March 2017) Number of New Rooms (2017) 80.4% JPY 26,648 JPY 21,431 6.5 million 463 rooms

Tourism Demand New notable hotels A total of 50.9 million visitor nights were The proliferation of alternative spent in Tokyo in 2016, representing accommodation options such as Airbnb APA Hotel Sugamo-Ekimae 12.3% of all visitor nights across Japan. have had an impact on demand for hotels 512 rooms International accommodation guests, which and hostels across Japan but particularly account for 31.7% of the total had slightly in Tokyo where room rates are highest in The Prince Gallery Tokyo Kioicho declined by 1.6% y-o-y while domestic the country. Tokyo is most popular during 250 rooms accommodation demand fell by 5.9 % y-o-y. cherry blossom season and Chinese New While international visitor arrivals to Japan Year holidays. The introduction of budget APA Hotel Ochanomizu-Ekikita increased by around 22% y-o-y in 2016, carriers into second tier cities of Japan 187 rooms demand for internationally-branded hotels is seeing tourism growth outpace Tokyo. Oakwood Premier Tokyo has not followed suit. The higher rate of However, for the first two months of 2017, 129 rooms full-service Tokyo hotels is driving business inbound visitation was still up a healthy to cheaper nearby cities whilst limited- 15.7% on 2016. Hoshinoya Tokyo service remains a preference and Airbnb is 84 rooms definitely impacting.

Upcoming hotels Trunk Hotel Supply Outlook Moxy Tokyo Kinshicho According to the Japan Ministry of Health, Moving forward, Tokyo hotel trading Labour and Welfare, hotel and ryokan performance is expected to show further supply in Tokyo accounted for 1,891 growth but at a slower pace than witnessed properties (149,286 rooms) as at March over the past two years. Any RevPAR Notable hotel deals 2016. Just two new luxury products, the improvement will be driven by ADR increase There were no hotel transactions in first being Hoshinoya Tokyo (84 rooms) as occupancy has already peaked in our and the second The Prince Gallery Tokyo view and many hotels are operating at full H2 2016 Kioicho (250 rooms) have been added to the capacity. Full-service hotels in Tokyo have market since then. The pipeline in Tokyo come under some pressure to maintain rate overall remains rather benign until the 2020 whilst limited-service have enjoyed stronger Summer Olympics. support because of the appreciation of the JPY making the former more expensive for leisure tourists.

Note: Tokyo Hotels refers to Upscale Source: STR Global (YTD March 2017), Japan Tourism Agency, JLL ADR - Average daily rate, RevPAR - Revenue per available room, OCC - Occupancy Hotel Destinations – Asia Pacific 26

Yangon Quick Facts OCC ADR RevPAR International Visitor Arrivals (Myanmar 2016) Number of New Rooms (2017) 55% USD 150 USD 83 4.4 million 1,691 rooms

Tourism Demand Foreign visitor arrivals to Yangon have With geographical proximity and New notable hotels grown rapidly after cyclone Nargis in 2008 governmental cooperation, Thailand and to reach a peak in 2015 at 1.2 million, a Mainland China have consistently remained Meliá Hotel and Hoang Anh 15.5% growth y-o-y. International visitors the top source markets to Myanmar, despite Gia Lai Myanmar Centre to Myanmar registered 2.9 million in 2016 indicative numbers suggesting a slight drop 430 rooms under the Ministry for Hotels and Tourism’s in Chinese arrivals in 2016. Singapore was revised data collection method to exclude a key growth market in recent years and Ibis Styles Yangon Stadium one-day visitors at border crossings. As at the Union Minister for Tourism expects 35% 108 rooms YTD February 2017, the nation saw 600,000 y-o-y growth in 2017 with visa-free travel international visitors, a 22% growth over and a Myanmar roadshow in Singapore late- TRYP by Wyndham Yangon the same period in 2016. 2016. Based on released statistics, other 60 rooms top source markets in 2015 were Japan at 6.9%, followed by the United States and South Korea at 5.4% and 4.9% respectively. Upcoming hotels Lotte Hotel Yangon Rose Garden Hotel (Phase 2) Pan Pacific Yangon Supply Outlook Centrepoint Grand Hotel While the majority of existing supply in Yangon is expected to benefit from Kempinski Yangon Yangon were hitherto largely unbranded, by continued growth in visitor arrivals with 2020 almost 5,000 new rooms are expected the addition of new air routes and airlines, to enter the market, much of which will be supported by expansion of the Yangon in the upscale and luxury sector. 2017 alone International Airport and the ongoing Notable hotel deals will see the addition of almost 1,700 keys, construction of Hanthawaddy International all of which will be in the luxury and upscale Airport which will collectively raise capacity There were no hotel transactions in markets. to 20 million by 2022. Myanmar also held H2 2016 its first ever International Tourism Expo in Yangon and ran roadshows oversees to emphasis its open door policy. However, the massive influx of room supply, particularly in the luxury and upscale sectors, will take some time to be absorbed which is likely to put further pressure on occupancy and rates in the short to medium term.

Note: Yangon Hotels refers to Five-star Source: Ministry of Hotels & Tourism, JLL Estimates ADR - Average daily rate, RevPAR - Revenue per available room, OCC - Occupancy 27 Hotel Destinations – Asia Pacific

Quick Facts Comparison

Revenue per Average Daily International Total Number Occupancy Available Rate (ADR) Visitor Arrivals of New Rooms (OCC) Room (Latest Available) (2017) (YTD March 2017) USD (YTD March 2017) (RevPAR) USD (YTD March 2017)

3.5 million AUCKLAND 100 86.6% 132 115 (MARKETWIDE) (NZ 2016)

4.9 million BALI 3892 66.4% 146 97 (UPSCALE) (2016)

20.8 million BANGKOK 2876 86.4% 99 86 (UPSCALE) (2016)

4.2 million BEIJING 1479 69.6% 81 56 (FOUR-STAR) (2016)

935,000 BRISBANE 207 71.5% 116 83 (MARKETWIDE) (2016)

8.9 million* DELHI 540 83.1% 85 71 (DELUXE) (India 2016)

4 million HANOI 843 85.2% 113 96 (MARKETWIDE) (2016)

HO CHI 5.2 million 1007 75.7% 117 89 MINH CITY (2016) (MARKETWIDE)

56.7 million HONG KONG 1022 83.7% 226 189 (UPSCALE) (2016)

2.4 million JAKARTA 3193 53.8% 166 89 (UPSCALE) (2016)

26.8 million KUALA LUMPUR 2548 68.7% 121 83 (LUXURY & UPSCALE) (Malaysia 2016)

31 million MACAU 3101 85.2% 171 146 (MARKETWIDE) (2016)

1.3 million MALDIVES 1316 69% 843 582 (MARKETWIDE) (2016)

* International Passenger Traffic ** International Accomdation Guests Source: STR Global (YTD March 2017), Various Sources, JLL Hotel Destinations – Asia Pacific 28

Revenue per Average Daily International Total Number Occupancy Available Rate (ADR) Visitor Arrivals of New Rooms (OCC) Room (Latest Available) (2017) (YTD March 2017) USD (YTD March 2017) (RevPAR) USD (YTD March 2017)

5.9 million MANILA 3101 70.6% 107 75 (MARKETWIDE) (Philippines 2016)

1.7 million MELBOURNE 427 88.3% 166 147 (MARKETWIDE) (2016)

9.4 million** OSAKA 164 78.9% 205 161 (MARKETWIDE) (2016)

4 million PHUKET 950 87.9% 147 129 (MARKETWIDE) (2016)

17.2 million SEOUL 1362 71.7% 84 60 (MIDSCALE & ECONOMY) (South Korea 2016)

303,000 SEYCHELLES 127 75.7% 175 132 (MARKETWIDE) (2016)

8.5 million SHANGHAI 5428 65.8% 81 54 (FOUR-STAR) (2016)

16.4 million SINGAPORE 2413 85.3% 179 153 (UPSCALE) (2016)

2 million SRI LANKA 674 66.4% 111 73 (MARKETWIDE) (2016)

2.4 million SYDNEY 338 91.1% 209 190 (MARKETWIDE) (2016)

10.7 million TAIPEI 300 68% 228 155 (LUXURY & UPSCALE) (Taiwan 2016)

2.5 million** TOKYO (YTD February 334 80.4% 237 190 (UPSCALE) 2017)

4.4 million YANGON 1691 55% 150 83 (FIVE-STAR) (Myanmar 2016)

* International Passenger Traffic ** International Accomdation Guests Source: STR Global (YTD March 2017), Various Sources, JLL 29 Hotel Destinations – Asia Pacific Asia Pacific Key Destinations

Beijing Seoul Tokyo Osaka

Shanghai Delhi

Taipei Macau Hong Kong Hanoi

Yangon Bangkok Manila Ho Chi Minh City

Sri Lanka Phuket Kuala Lumpur Seychelles Maldives Singapore

Jakarta Bali

Auckland Brisbane

Sydney

Melbourne Hotel Destinations – Asia Pacific 30

Key Contacts

Scott Hetherington Craig Collins Chief Executive Officer Chief Executive Officer [email protected] [email protected] Asia Australasia

Mike Batchelor Mark Durran Managing Director Managing Director Investment Sales Investment Sales [email protected] [email protected] Asia Australasia

Tom Sawayanagi Troy Craig Managing Director Managing Director [email protected] Strategic Advisory Japan [email protected] Asia Pacific

Frank Sorgiovanni Head of Research [email protected] Asia Pacific

About JLL Hotels & Hospitality Group

JLL’s Hotels & Hospitality Group has completed more transactions than any other hotels and hospitality real estate advisor over the last five years, totalling more than $68 billion worldwide. Between negotiating the world’s most extraordinary, enticing, and profitable property deals, the group’s 350-strong global team also closed more than 4,400 advisory, valuation and asset management assignments. Investors worldwide turn to JLL to shape their strategies, tailor their portfolios and maximise the value of their assets. We are recognised as the global leader in real estate services across hospitality properties of all shapes and sizes.

Our expert advice is backed by industry-leading research. We apply our broad spectrum of hotel valuation, brokerage, asset management and consultancy services through every phase of the hotel lifecycle. We have helped more hotel investors, owners and operators achieve high returns on their assets than any other real estate advisor in the world. Whether you are looking for a hotel or you’re ready to sell, we’ll use our capital markets expertise, knowledge and global relationships to put the right parties together and execute a bespoke deal that exceeds your objectives.

To find out more, talk to JLL. www.jll.com/hospitality www.jll.com/hospitality Jones Lang LaSalle © 2017 Jones Lang LaSalle IP, Inc. All rights reserved. All information contained herein is from sources deemed reliable; however, no representation or warranty is made to the accuracy thereof.