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 Medical Tourism Retirement

 Domestic Tourism Explosion
 Domestic visitor numbers to increase by 19.1% in 2010
 Most Popular Destinations

Baguio/Banaue- .73 M Camarines Sur- 1.23 M

Manila- 1.44 M Cebu- 1.61 M

Puerto Galera- .50 M Bohol- .32 M

Boracay- .65 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