Hotel prices in key cities will see only modest rises next year, restricted by a global supply boom and dampened demand, a report by American Express Global Business Travel (AMEX GBT) found.
In Asia Pacific, hotel prices are forecast to increase between 1- to 5%, according to the report, Hotel Monitor 2020.
Cities such as Bangkok, Ho Chi Minh City, Kuala Lumpur, Melbourne, Shanghai and Singapore are expected to see a 2% rise in hotel prices, while Beijing and Sydney are looking at a 1% increase.
Hong Kong will see a moderately higher rise of 3%, owing to record visitor numbers that generated a high city-wide occupancy since 2018 and slowing rate of hotel development.
Marco Pellizzer, American Express GBT's vice president and general manager, Hong Kong and China Mainland notes that "business travel to Hong Kong is steadily increasing, and as such, Hong Kong is developing hotel offerings at a high rate."
Tokyo, which is targeting to attract 20 million visitors next year when it hosts the 2020 Olympics, could see a rise of up to 4%. The highest projected rise will come from hotels in Bangalore, where prices are tipped to increase by 5%.
The region's hospitality region is growing rapidly, with thousands of additional beds being added in key cities each year. But sustained demand in these growth economies is expected to fuel increase in prices.
Inbound leisure and business generated a key part of the demand in Asia Pacific, compensating for shortfalls in international visitor numbers stemming from a less optimistic global economic outlook.
US hotels expect to face flat occupancy and a full pipeline of rooms in construction, which looks to increase competition and limit the ability of hotels to raise prices. Canada, meanwhile, is likely to see rates rise, helped by a relatively strong economic performance and slowing capacity growth.
Europe hotels are projected to experience a small rise in room rate due to low growth, uncertainties from Brexit and a depressed global economic outlook. This is matched by a record high growth in hotel development.
More details on hotel price movements across 150 key business cities can be found here.