Here’s a rundown of Jakarta’s hotel market performance

At least five hotels are slated to open by end-2023. 

Over the past three years, the number of hotels in Jakarta has been declining. According to Colliers, the adversities of the pandemic compelled hoteliers to adopt survival strategies. While a handful of hotels were forced to close, many others embarked on extensive renovations and revitalization efforts. 

These endeavours were aimed at reinstating their competitive edge vis-à-vis other establishments by the year 2023.

Here’s more from Colliers:

Certain hotels, particularly those situated near business and government hubs, are beginning to witness a resurgence in activity. Some are even in the midst of gradual renovations and the introduction of additional facilities. Based on our records, we believe at least five hotels are slated for open by the end of 2023. Undoubtedly, this development will intensify competition, particularly within central business and government districts.

Noteworthy improvements in the performance of the hotel industry in Jakarta have been apparent in Q2 2023, especially following the conclusion of the Eid holiday. Business activities have returned to pre pandemic levels, which is particularly significant considering the substantial contribution of the MICE sector to the city’s hotels. 

The MICE segment experienced a marked upswing in activity in Q2 2023. The upswing can be attributed to both an increase in the number of events and the removal of limitations on participants, consequently leading to a surge in revenue derived from the MICE sector. 

Throughout the pandemic, from 2020 to 2022, travel was severely curtailed, particularly long-distance journeys such as out-of-town trips or international travel. Consequently, most hotels experienced a significant decline in guest numbers. To entice guests during this period of reduced mobility, many hotels resorted to offering discounts. 

As a result, staycations at hotels emerged as a popular alternative for short getaways, be it on weekends or holidays. This trend was particularly evident during the Eid holidays in the 2020-2022 period when many individuals opted to spend their vacations in hotels due to challenges associated with travelling out of town or abroad. 

However, in 2023, the situation has changed. The relaxation of travel restrictions and the reopening of international borders have facilitated an increase in out-of-town and international vacations, consequently leading to a decline in hotel performance in Jakarta compared to the previous year during the Eid holiday season. 

Looking ahead to 2024, with the upcoming presidential election, hotels are expected to witness a surge in politics-related events and activities. However, based on the information obtained in Q2 2023, the political agenda has been relatively subdued thus far. It is anticipated that preparations for the presidential election will intensify during the second half of 2023. Additionally, corporate events and other gatherings will continue to contribute to revenue generation.