After a long spell of pandemic-induced uncertainty and unprecedented challenges, travel in Asia Pacific is soaring again and the hospitality industry is looking resolutely towards a brighter future.

At Hotel Investment Conference Asia Pacific (HICAP) 2022, which took place in Singapore on 19-21 October, talk was rife not on recovery but where growth were going to come from. “Recovery is not in our vocabulary,” said Robert Hecker, managing director Pacific Asia of Horwath HTL at the HICAP in Singapore. "It’s all about growth."

From branded collections to all-inclusive offers, the future of the hotel business is upbeat but it will not look the same as before. Travel Weekly Asia unpacks the trends that may dominate the hospitality industry’s landscape in the years to come.

Rise of the independents, all-inclusives

Hyatt Hotels Corporation’s executive vice president and head of global development Jim Chu, who oversees several different collections including Unbound, JDV by Hyatt and Destination by Hyatt, sees demand for independent properties on the rise. "We see a lot of activity in unique independent hotels," he said. "Lifestyle hotels have been attractive to customers."

Chu points out that many factors have made the collection option increasingly attractive to stand-alone hotels. "Over the last two years, the cost of delivering has become very expensive," he said, citing elements like OTA commissions and loyalty programmes, giving hotels more reasons to become affiliated with a collection.

As Hyatt has acquired the Apple Leisure Group and its AMR Collection of all-inclusive resorts in November 2021, Chu is also bullish about all-inclusive properties even though the concept has yet to gain much traction in Asia.

"It is a very small market within the Asia marketplace today but we are excited about bringing that to bear here in Asia." While Hyatt has yet to make any specific announcements, he adds, "We’ve done some work about areas that would be receptive to that style beach oriented like Vietnam and Thailand."

Jeff Wagoner, president and CEO of Outrigger Hospitality Group, sees hybrid solutions as existing properties transition to all-inclusive schemes. "We’re going to start seeing more of that because of the success of all-inclusive markets that are ripe for the all-inclusive experience," he said. 

Hyatt Hotels Corporation’s Jim Chu sees growing demand for independent and lifestyle properties in Asia Pacific. Pictured: Fuji Speedway Hotel in Japan

Market specific brands

Chu bought up the subject of global groups promoting country specific brands. Hyatt, for instance, has UrCove by Hyatt in China, an upper midscale brand that is a joint venture with BTG Homeinns and Atona, modern luxury ryokans that are unique to Japan, aimed at both local communities and international travellers.

But other industry leaders are not investing in single-market brands. Smaller Outrigger is not looking to multiply its branding. "We want to be the premier beach resort company in the world," Wagoner stated.

Choe Peng Sum, CEO of Pan Pacific Hotels Group, played down the notion of market-specific brands for the Singapore-based company. "I’ve only got three brands," he said.

That doesn’t mean that there aren’t country-specific strategies though. Hilton is actively pursuing franchising in China, where they’ve signed 40 hotels in the last year, "most of which were in the franchising space," according to Clarence Tan, Hilton’s senior vice president for development, Asia Pacific. 

Outrigger Hospitality Group's Jeff Wagoner is focusing growth in beach resort destinations like Bali and Thailand as well as potential in Australia. Pictured: Outrigger Reef Waikiki Beach Resort in Hawaii

Sustainability vs greenwashing

Sustainable practices are now a given across much of the industry, but the jury is still out on hotels that are making a real impact versus those that are just paying green-washed lip service.

"A hotel based on sustainability is an expensive hotel, putting things that people don’t see but it makes a lot of sense," says Pan Pacific’s Choe. But under increasing pressure from both investors and the communities where the hotels are located, everyone is going to embrace the economics of sustainability and carbon reduction.

There is "no difference" between Asia and the rest of the world, says Wagoner. "It’s a global issue that we’re all wrestling with and I think everyone puts rigour behind it."

Tan added however that a Cornell University study showed that Asia’s kilowatt hour per occupied room ratio was almost double acceptable averages, meaning that hotels in the region still had a way to go.

Chu put it succinctly: "It’s irresponsible not to be responsible."

Hilton is expanding its Singaporean presence with the upcoming opening of Conrad Singapore Orchard in Q1 2024, to be rebranded from Regent Singapore.

A hot growth region

For Hilton, Tan saw opportunities in Japan, China and India. "We see the growth of the middle class," he said, a segment that according to him will grow from 1.5 billion to 3 billion in the coming years. When asked to pick one, he picked the potential of China. "China growing domestically is where I see our future," he said, pointing to the country’s 1.4 billion travellers in the first nine months of this year despite its strict zero-Covid policies that limit travel.

Chu and Choe, on the other hand, picked Japan. "It’s a great market with great international appeal and consumer dedication," said Chu.

Meanwhile, Wagoner saw growth in Outrigger’s traditional markets like Bali and Thailand, but singled out developments in another key market as holding the most potential. "The one that we’re really focused on is Australia," he said.

While there are still significant issues regarding airline capacity, Alan Watts, president - Asia Pacific for Hilton pointed out that travel – both leisure and business – is fast making a comeback in Asia Pacific.

“Our business in Australasia is double digits up. India's almost double digits up and the fact that Southeast Asia is performing at 2019 levels without outbound Chinese and just with a third of outbound Japanese is incredible,” he added.

What’s certain is that Asia Pacific remains a growth region for hospitality and that people will travel again as soon as they have the opportunity. "The pent-up [demand] is real," Watts noted.