southeast asia hostel market update january 2018 asia hostel market update january 2018 ... cambodia...

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SoutheastAsiaHostelMarketUpdate

January2018

Trends ForwardOutlook• Laosleadsregionalsupplygrowthwitha58%

increaseinbedinventoryy-o-y,followedbyCambodiaandMalaysiaat52%and43%,respectively.

• Conventionalhotelcompaniesinvestingintothehostelsector,highlightedbyLub dwhichisregion’slargest/fastestgrowinghostelgroup.

• Despiteinfluxofcapitalintobrandedhostels,independentpropertiesremainpredominantinthemarketwithsoaringy-o-ygrowthof87%.

• Currentgovernmentrulesandregulationsforopeninghostelsarenotclearlydefinedbutareincreasinglycomingunderscrutinyduetogrowthofsharedeconomyproducts(i.e.Airbnb).

• Growthofhostelsupplyinleisuredestinationsreflectinghighdemandforbudgettravelersandchangingtasteforexperientialaccommodation.

• Microaccommodationisshiftingproducts,asprivacyisbecomingindispensableforhostels,andexponentialgrowthinprivaterooms.

BillBarnett,ManagingDirector,C9Hotelworks

HostelMarketSizebyCountry

Source:C9HotelworksMarketResearch

With30%growthinbedsupplywithinayear,hotelchainsandinvestorseyehostelofferingsSegmentonwaytobecomingkeycompetitiontobudgethotelmarket“Thehostelmarketlastyearexperiencedskyrocketinggrowthof32%inbedinventory,amountingto63,632bedsin1,766propertiesacrossSoutheastAsia.Thailand,withitsprolifictourismnumbers,continuestoleadthesectorwitha41%share.Withmountingdemandinthesector,thereisnosignofdecelerationasinvestmentisbeingembracedbyanincreasingnumberofhospitalitygroupsandinstitutionalinvestors.

Inpastyears,hosteldevelopersmaximizedprofitsbydevelopingpropertieswithhighbedinventoryandnoprivaterooms.However,micro-privateroomsinhostelsarebecomingessentialandimpactfultorateyields.ThiscanbestbeseeninthegrowthofhostelswithprivateroomsinIndonesia,ThailandandVietnamwhichnowexceed50%ofoverallroominventory.

Despiteanelevatedgrowthofsupply,oneconsiderablecomplicationtothehostelmarketistheambiguousrulesandregulations;thesehavebecomeamajorconcerninleadingdestinationssuchasThailand,MalaysiaandevenJapan.Whilegovernmentregulationisstartingtoevolve,thisremainakeysectorissue.”

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MARKETOVERVIEW

C9SEAsiaHostelMarketUpdate:January2018

Independenthostelsdominatetheregionalmarket,with1,532propertiesrepresenting87%oftotalsupply

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LeadingNationalitiesBookingSoutheastAsiaHostelsOnline

Chainvs.IndependentHostels

GrowthofHostelswithPrivateRooms

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PrivateRoomsvs.SharedRoomsMix

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Source:Hostelworld

Source:C9HotelworksMarketResearch

Source:C9HotelworksMarketResearch Source:C9HotelworksMarketResearch

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AverageDailyRateperBed(ADRB)

3C9SEAsiaHostelMarketUpdate:January2018

PERFORMANCEINDICATORS

ABRacrossregionis3.9,withSingaporehavingthehighestratioat6.3

AverageBedsperRoom(ABR)RatiobyCountrySource:C9HotelworksMarketResearch

Source:C9HotelworksMarketResearch

SelectAverageBookingLeadTimesandLengthofStaybyDestination

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Source:Hostelworld

Year-on-yearmarket-wideADRBdeclinedasnewpropertiesrosesharply.SingaporehashighestADRBfollowedbyMyanmarandPhilippines

Data:Fullyear2016

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C9HotelworksCompanyLimited

www.c9hotelworks.cominfo@c9hotelworks.com

TopFiveHostelMarketLeadersSoutheastAsia

ThailandNumberofhostels:722Numberofbeds:25,207Growth(y-o-y)ofbedsupply:28%

CambodiaNumberofhostels:138Numberofbeds:5,560Growth(y-o-y)ofbedsupply:52%

MalaysiaNumberofhostels:263Numberofbeds:9,113Growth(y-o-y)ofbedsupply:43%

SingaporeNumberofhostels:92Numberofbeds:5,541Growth(y-o-y)ofbedsupply:4%

VietnamNumberofhostels:221Numberofbeds:7,763Growth(y-o-y)ofbedsupply:41%

Top5HostelMarketCountriesLub d:5properties,1,035beds(Thailand-based)TheMadMonkey:8properties,980beds(Cambodia-based)5footway.inn:5properties,730beds(Singapore)VietnamBackpacker:5properties,581beds(Vietnam)InternationalInnHotelsGroup:8properties,284beds(Malaysia)

Source:C9HotelworksMarketResearch