As the capital city of Indonesia, Jakarta is bustling with commerce.  The hotel market is one of the most productive income-producing properties in Jakarta.  How is the Jakarta hotel market in 2010?  Read on this property research piece, courtesy of Colliers International Indonesia.

Jakarta Hotel Newcomers and Prospects

During the year 2010 four new hotels began to operate Jakarta: a 3-star hotel, two 4-star hotel and one 5-star hotel. Kawanua Aerotel, a 3-star the hotel has 79 rooms and was developed by North Sulawesi provincial government and managed by Aerowisata. From this hotel 11 floor, 10 operated as a hotel and one as their Jakarta Representative Office. Meanwhile, 5-star hotels Merlynn Park KH Hasyim Ashari also operates under the Sunlake Hotel Group. Hotel Merlynn Park, from 26 floors, consisting of 301 rooms and ballroom. Other hotels, Harris 4-star hotel in Kelapa Gading, which Under Tauzia Hotel management, operates with 226 rooms. In the last quarter of 2010, Best Western Mangga Dua launched. This is the first Best Western hotel chain in Jakarta, operates the first 118 of the planned total of 168 room.

In short, during the year 2010 four new hotels giving a total 724 rooms. Conversely, hotel market also saw the closing down one 3-star hotel, Sofyan Cikini (111 rooms), has been operating for about 27 years.  The hotel is owned by PT Hotel Sofyan Language. and sold to PT Cempaka Jaya Wenang Rp44.47 billion. PT Cempaka Jaya is Wenang developers to Villa Del Sol and Villa Earth Ciherang, both located in Cipanas, West Java. developer has also developed Pearl Kemang Townhouse and Pearl UB Residence in Jakarta. All in all, with the introduction of of four hotels, minus Sofyan Cikini Hotel, number of hotel rooms in Jakarta 23 638, of a total of 98 hotels.

Based on the classification, the percentage of space both 4-star hotel and 5-star hotel is 39%, which 4-star hotel has 9154 rooms in 35 hotels. In the short term, the remaining 50 rooms of Best Western Mangga Dua will be launched in 2011. Furthermore, in the same year, Jakarta will receive another 370 from the operation of a hotel room in Pullman Hotel Central Park commercial complex in West Jakarta.


Source:  Colliers International Indonesia

Over the next three years, it is estimated that the supply of hotel rooms will grow at 6.3% per year, with hotels 5-stars as the largest contributor, with 2407 rooms. During the same period, Jakarta should see an additional 804 rooms of a 3-star hotels and 1575 rooms of 4-star hotel. It is interesting to note that some future development of hotels will be built in the compound mixture of commercial uses such as Pullman in Central Park, County Aryaduta in Kemang Village, Aryaduta Hotel & Convention in St. Moritz, hotels in Gandaria City and hotels in Kota Kasablanka.

Source:  Colliers International Indonesia

Jakarta Hotel Customers

Local Customers to supporting business hotels in Jakarta, dominates the profile guests throughout the year 2010. Foreign guests in 3-star hotel is only represented 11%, whereas in 4-star hotel 27% of hotel guests are foreigners. Five-star hotel has a high complement of foreign visitors, in 46%. However, this amount is lower than in 2009, when foreign visitors dominated profile of 5-star guest, at 57%.

Source:  Colliers International Indonesia

Seeing the length of stay (LOS), foreign visitors to stay longer than local guests. Foreign visitors stay longer at the 3-star hotel than in the 5-star hotel, while local guest to stay longer in the 5-star hotel than a 3-star hotel, especially during school holidays (June-August period). Foreign visitors to stay longer in the months and then years.>

Source:  Colliers International Indonesia

Jakarta Hotel Demand

The number of foreign visitors coming to Jakarta in January – November 2010 through Soekarno Hatta airport was recorded at 1,684,394, representing 26.5% of all foreign visitors throughout Indonesia.

The government has targeted an increase of 10% in 2011 to the number of foreign tourists to Indonesia, from 7 to 7.7 million in 2011. This target is expected to contribute US$8.3 billion to the country (assuming that each tourist will spend around US$1,100. MICE (meeting, incentive, conference and event) will contribute most in the tourism business.

Jakarta Hotel Performance

Average Occupancy Rate (AOR)

In general, the occupancy rate for starred hotels in Jakarta experienced a decline during 3Q2010, mainly due to the Muslim festive holiday, but bounced back in 4Q2010 with an upward trend of between 4% and 9%. During the quarter, 4-star hotels still recorded the highest occupancy, with an average of 74%, followed by 3-star hotels at 65% and 5-star hotels at 59%. In the 3-star category, three hotels achieved high occupancy, of above 80%: Ibis Mangga Dua, Harris Hotel and Bumi Karsa. Meanwhile, quite a few 4-star hotels reached occupancy levels above 80%; among the highest were Menara Peninsula, Santika Nusajaya and Nikko Jakarta. As for the 5-star category, only 3 starred hotels showed occupancy of 70%: Hotel Mulia, Parklane and Aston Sudirman.

Source:  Colliers International Indonesia

Average Room Rate (ARR)

The overall average room rate for this quarter rose by 5.5% QoQ, to Rp556,504, for 3- to 5-star hotels. ARR for 3-star rose to Rp335,554, from Rp320,054, in the previous quarter, with three hotels recorded the highest ARR: iBumi Karsa, Harris Hotel and Grand Kemang. In the 4-star category, ARR was registered at Rp478,431 this quarter, up from Rp455,745 last quarter. Three hotels in this category had high ARR: Sari Pan Pacific, Ambhara and Ciputra. Seven hotels in the 5-star category reached ARR of above Rp1 million, the top three for this quarter being Kempinski Hotel Indonesia, The Ritz Carlton at SCBD and Grand Hyatt. Meanwhile, the overall ARR for 5-star hotels was Rp855,526, up from Rp806,613 in the previous quarter.

Source:  Colliers International Indonesia

Jakarta Hotel Outlook 2011

By 2011 the government will introduce a new branding – “Wonderful Indonesia” – as part of a tourism campaign to lure up to 7.7 million foreign tourists. The new tagline is expected to have stronger appeal, as it reflects Indonesia’s beautiful nature, unique culture, varied food, hospitable people and price competitiveness in various kinds of service. In 2010, around 7 million tourists visited Indonesia, up from 6.4 million in 2009. Nevertheless, hotels in Jakarta are not too dependent on the foreign market. Guest profiles in Jakarta are predominantly local Indonesians.

In general, the Jakarta hotel market will grow in 2011, particularly benefiting from the number of MICE events scheduled to take place in Jakarta, including ASEAN sport events (Sea Games) and the General Assembly of UNESCO Intergovernmental Committee for Intangible Cultural Heritage, which will take place in Jakarta around November 2011.