Global Tourism Overview
BMI View : The global tourist accommodation sector will greatly benefit from the rise in international tourist arrivals forecasted from 2013-2017. The growing number of outbound and domestic-based tourists from Asia and Latin America has provided great incentives for the tourist accommodation sector to increase the number of hotels and rooms on offer across these regions. Even though underlying economic risk remains, over the next five years we estimate annual growth in total hotel units to be within 3-5% from 2013 to 2017.
Despite the difficult global economic picture, international tourist arrivals are expected to grow across 2013. Historically the number of tourists has been rising year on year in eight out of the ten years from 2002-2012, the only fall being in 2009 due to the global economic crisis. In 2012, International tourist arrivals grew by 4.3% in 2012, we saw positive growth stemming from a number of factors including tourists taking advantage of a weaker euro to travel to eurozone states, as well as a growing middle class in Asia who have an increasing inclination to travel abroad. We expect this trend to continue. BMI estimates that international tourist arrivals will report growth of 4.1% at the end of 2013, an increase of 38.6 million tourists to 971.1 million from 2012 across BMI's tourism universe. We forecast that annual growth in international tourists arrivals will remain between 4-5% for the next five years from 2013 to 2017.
|WORLD: Total Arrivals mn*||783.1||840.9||894.3||932.5||971.1||1019.1||1068.7||1121.1||1170.5|
|WOLRD: Total Arrivals mn, % change y-o-y||-4.9||7.4||6.3||4.3||4.1||4.9||4.9||4.9||4.4|
Growing tourist arrivals driving tourist accommodation
With international tourist arrivals set to grow from 2013-2017, the global tourist accommodation sector will look to support the increase in number of tourists through the construction of new hotel units. Across the world the tourist accommodation sector is likely to face stiff competition, and competitors look set to enhance market share through pricing, aesthetics by introducing wide scale renovations and, mass branding and marketing initiatives in the emerging markets. Over the last few years financial markets have seen an inflow of capital and the tourist accommodation sector has taken advantage of this by taking the opportunity to use leverage to initiate wide-ranging hotel renovations and construct new accommodation. Historically the level of total hotel units globally has been volatile, 2010 posted an increase of 3.7%, in 2011 total units slowed down to 0.9% and in 2012 total units increased again by 1.7%. Internationally we see the tourist accommodation sector increasing the number of hotel units across 2013 by 2.2% to 1.099 million units in total by the end of the year. From 2014-2017, BMI forecasts that annual growth in total hotel units to be between 2-2.5%.
|WORLD: Number of hotels|
|and establishments, '000*||1011.1||1048.8||1058.6||1076.5||1099.8||1124.0||1149.2||1176.6||1205.9|
|WORLD: Number of hotels|
|and establishments, '000, % change y-o-y||4.9||3.7||0.9||1.7||2.2||2.2||2.2||2.4||2.5|
Regionally, Latin America is set to perform the best, with forecasted growth in total hotel units to be 4.32% in 2013 and 4.35% in 2014. High numbers of growth are dominated by the growing trend in inbound arrivals within the region, and the rise of domestic tourism in countries such as Brazil. Over the same forecast period Brazil will see a surge in new hotel developments in preparation for the 2014 FIFA World Cup to be staged in twelve cities across the country and 2016 Olympics to take place in Rio de Janeiro. Over the last few years in the Asia-Pacific region there have been many large scale hotel development projects. With rising middle classes in parts of Asia such as China and India, people are more likely than ever to travel for leisure. The tourist accommodation sector in the region is likely to capitalize on the greater number of outbound travellers from these countries and provide a greater number of hotels and facilities to offer guests. In 2012, total hotel units increased by 153,358 or 3.8% from 2011. Over the next five years from 2013 to 2017, BMI forecasts the region to grow over 4% annually. In isolation, total hotel units in China and India have grown by an annual average of 12.87% and 18.36% respectively over the last five years from 2012. This is on the back of strong rising levels of domestic tourists and international arrivals that are now attracted by the better infrastructure and facilities on offer at hotels. For 2013 we forecast annual growth of 9% for China and 13% for India. International hotel chains Marriot International, Starwood Hotels & Resorts and Hilton Worldwide have outlined expansion plans in China. Starwood Hotels & Resorts Worldwide, now have 100 hotels in the country and are another 100 have been outlined. Marriot is looking to double its share of hotels within the country by 2014.
Elsewhere, BMI estimates that total European hotel units will show annual growth of 0.5% for 2012. This lower pace of growth is largely generated by a 0.1% fall in total hotel units across Western Europe for the same period. Falls in domestic income have led to a decrease in domestic hotel demand and a shorter length of stay by international guests have fallen under 4 nights in 2012 for the first time in ten years. Across the region, many unprofitable hotel units have been closed and others have been relocated. Over the next five years from 2013, we expect this trend to continue, and estimate total hotel units will grow in the range of 0.5-1% annually. In the Middle East, BMI estimates a bounce back in hotel construction in 2013 buoyed by a general lift in construction activity within the region, total hotel units will increase by 2.1%.
Hotel rooms also set to increase
For 2013, BMI forecasts that the total number of hotels rooms internationally will grow by 3.3%. The growth in the total number of rooms will be boosted twofold, firstly by new hotel construction which will increase the global stock levels of rooms and secondly by the restructuring and renovation of existing hotel units that will provide greater rooms. BMI forecasts strong growth in the total number of hotel rooms in Latin-America to be 5-8% annually over the next five years from 2013 to 2017. In other regions Europe will grow by 1.5-2%, North America by 1.5-1.6%, Asia by 2-5% and the Middle East by 2-5% over the same forecast horizon.
Room occupancy rates to remain steady
Hotel room occupancy rates remain traditionally high in city based states and locations due to the lack of availability of new land for new hotel construction. Singapore and Hong Kong remain the best with rates of 86.5% and 82.37% recorded in 2011 and BMI estimates this to be around this level at the end of 2012 and going forward into 2013. Regionally higher occupancy rates are seen in Asia, Europe and North America. Globally occupancy rates are estimated to remain between 50-60% over the next five years from 2013 to 2017, where growing room occupation will be counteracted by growth in hotel rooms.
Overnights stays rising in Asia and Middle East
At the end of 2011 total overnight stays internationally saw contractions of 1.6% in North America and 1.9% in Europe from 2010. Africa also noted a contraction of over 6% during the same period with only Asia, Middle East and Latin America showing growth. Trends in Europe and North America remain subdued with hotels in major western cities a lot pricier than emerging market equivalents. In 2012, average length of stay in Western Europe decreased to under 4 nights, the lowest it has been in a decade. We expect this trend to continue and forecast average length of stay to remain under 4 nights from 2013 to 2017. Globally, BMI forecasts total overnight stays to grow at over 3% annually from 2013 to 2017, weakness in Western Europe will be more than counteracted by strong growth in overnight stays within the Middle East and Asia. Overnight stays in Middle East will grow by 9% in 2013, and by 3.8% in Asia over the same period. These regions will benefit from the growing number of tourist arrivals from neighbouring nations.
Tourist accommodation sector remains sensitive to economic fundamentals
To take stock, there still remains significant underlying risk to the tourist accommodation sector, any impending global economic slowdown that constricts disposable income will lead to a reduction in future international tourist arrivals. This in turn will lead to a situation of over capacity in the tourist accommodation sector which may result in losses if hotel rooms are left unoccupied. If macroeconomic fundamentals are to improve this will translate into an increase in international tourist arrivals and provide greater incentive for further tourist accommodation construction.
|Source: BMI Key Projects Database|
|2013||Russia||Moscow||IAAF World Championship Athletics||Mixed|
|2013||South Africa||Rustenburg, Johannesburg, Nelspruit, Durban, Port Elizabeth,||Africa Cup of Nations||Football|
|2013||Brazil||Unconfirmed but short list is: Fortaleza, Recife, Salvador, Brasilia, Belo Horizonte, Rio de Janeiro||FIFA Confederations Cup||Football|
|2013||Sweden||Malmo||Eurovision Song Contest||Singing|
|2013||Czech republic||Prague||UEFA Super Cup||Football|
|2013||England||London||UEFA Champions League Final||Football|
|2014||Bangladesh||Dhaka, Chittagong, Narayaganj, Rajshahi, Sylhet, Khulna,||2020 World Cup||Cricket|
|2014||Brazil||Manaus, Fortaleza, Natal, Recife, Salvador, Brasilia, Cuiba, Belo Horizonte, Sao Paolo, Rio de Janeiro, Curitiba, Porto Alegre||FIFA World Cup||Football|
|2014||Wales||Cardiff||UEFA Super Cup||Football|
|2014||Scotland||Auchterarder, Gleneagles||Ryder Cup||Golf|
|2014||Russia||Sochi, Krasnaya Polyana||Winter Olympics||Mixed|
|2014||China||Nanjing||Youth games (Summer)||Mixed|
|2014||South Korea||Incheon||Asian Games||Mixed|
|2014||Portugal||Lisbon||UEFA Champions League Final|
|2015||Australia and New Zealand||Not Decided||Cricket World Cup||Cricket|
|2015||England||Cardiff, London, Birmingham, Brighton, Bristol, Coventry, Derbyy, Gloucester, Leeds, Leicester, Manchester, Milton Keynes, New Castle, Southampton, Sunderland||Rugby World Cup||Rugby|
|2015||Canada||Vancouver, Edmonton, Winnipeg, Ottawa, Montreal, and Moncton||FIFA Women's World Cup||Football|
|2015||Canada||Toronto||Pan American Games||Mixed|
|2015||Morocco||Casablanca, Rabat, Fes, Marrakesh, Tangier, Agadir||Africa Cup of Nations||Football|
|2015||Georgia||Tibilisi||UEFA Super Cup||Football|
|2015||Singapore||Not Decided||Asian Games||Mixed|
|2015||Australia||Melbourne, Sydney Brisbane Canberra||Asia Cup||Football|
|2016||France||Lens, Lille, Paris, Bourdeaux, Lyon, Marseille, Nice, Toulouse, St-Etienne||UEFA Euro||Football|
|2016||Brazil||Rio de Janeiro||Olympics||Mixed|
|2016||India||Not Decided||2020 World Cup||Cricket|
|2016||Norway||Lillehammer||Youth Games (Winter)||Mixed|
|2017||Libya||Not Decided||Africa Cup of Nations||Football|
|2017||England||London||IAAF World Championship Athletics||Mixed|
|2017||Russia||Moscow, Kazhan, Sochi, St Petersburg||FIFA Confederations Cup||Football|
|2018||Russia||Kaliningrad, Kazan, Krasnodar, Moscow, Nizhny Novgorod, Rostov-on-Don, Saint Petersburg, Samara, Saransk, Sochi, Volgograd, Yaroslavl, Yekaterinburg||FIFA World Cup||Football|
|2018||South Korea||Pyeongchang||Winter Olympics||Mixed|
|2018||Australia||Gold Coast City||Commonwealth Games||Mixed|
|2019||England & Wales||Not Decided||Cricket World Cup||Cricket|
|2019||Japan||Tokyo, Sapporo, Yokohama, Osaka, Toyota, Kobe, Fukuoka, Sendai||Rugby World Cup||Rugby|
|2021||Qatar||Not Decided||FIFA Confederations Cup||Football|
|2022||Qatar||Al-Khor, Doha, Ash-Shamal, Al Wakrah, Umm Salar, Al Rayyan||FIFA World Cup||Football|