Market Introduction & Trends - The Philippine Tourism Industry

The Philippines Hotel Investment Market

International Arrivals & Receipts (US$ B)

Arrivals are expected to increase by nearly 16% in 2010

International Visitors in 2010

In 2009 there were 91,000 visitors from the United Kingdom

Reasons for Visiting

The share of leisure travelers is likely to increase with the opening of new resorts in key destinations

What’s the Attraction?

Beaches Diving Bird-watching

Festivals Retirement

Medical Tourism

Domestic Tourism Explosion

Domestic visitor numbers to increase by 19.1% in 2010

Most Popular Destinations

Baguio/Banaue- .73 M

Manila- 1.44 M

Puerto Galera- .50 M

Boracay- .65 M

Camarines Sur- 1.23 M

Cebu- 1.61 M

Bohol- .32 M

Davao- .70 M

Domestic Airline Growth

Metro Manila Hotel Occupancy Rates

For the first 6 months of 2010, De Luxe hotel occupancy rate is up 8.35% to 71.5%

Business Process Outsourcing Expansion

Growth in Office Space in Metro Manila

Metro Manila Hotel Room Inventory

New Hotels in Emerging Business Districts

Eastwood Richmonde Hotel (2010)

138 Rooms

Alabang Bellevue Hotel (2003/09)

470 Rooms

Entrata Hotel (2011)420 Rooms

Leading Philippine Hotel Developers

Leading Philippine Hotel Developers

International Brands in the Philippines

Branded Resort Projects in the Pipeline

Banyan Tree integrated resort being developed in Coron, Palawan

600 total keys, 3 spas, marina and town centre

Six Senses Resort planned for Hermana Mayor Island, Zambales

Luxury Villas already reserved by celebrities

Resort Residential and Condohotel Market

Driven by expatriates living in Manila and HK, overseas Filipinos and a domestic market that is familiar with the condohotel model.

Summary The major listed developers are actively increasing

investment in the hotel market. Some are rolling out their own brands.

Top-end hotel projects are being funded as components of mixed-use developments or cross financed by residential / condohotel sales

Business activity is dispersing to the suburbs and provinces and new resort destinations are springing up

Need direct flights from the U.K. and Europe plus improvement of airports

Investment constrained by restrictions on foreign ownership of land and Illiquid investment market but IPOs and REITS are exit opportunities