Hotels & Hospitality Group | May 2016

Hotel Destinations
Indonesia

Contents
The Journey So Far...

04

1960s

06

WhatsHotel
Next and
For Hospitalitys
Indonesian
Hospitality?
Timeline

First IHG hotel

InterContinental Bali

1973

1970s
1927
First Inna
Group hotel
Bali Hotel

First Hyatt hotel

Bali Hyatt

Development of the
Nusa Dua integrated
resort project

2001
2013

Hotel and Hospitalitys

Timeline

Bali International
Airport upgraded

08

2014

10

Jakarta

Bandung

Easing of visa requirements for foreign visitors

Initiative to upgrade ten tourist destinations:
Lake Toba (North Sumatra), Tanjung Kelayang
(Belitung), Tanjung Lesung (Banten), the Thousand
Islands (Jakarta), Borobudur Temple (Magelang),
Mount Bromo (East Java), Mandalika (South Lombok),
Labuan Bajo (East Nusa Tenggara), Wakatobi
(Southeast Sulawesi), and Morotai (North Maluku)

Indonesias Key Destinations

Surabaya

Bali

Lombok

Legends
Hotel Openings
Other Developments
Transportation

City Profiles

11

Visitor Arrivals

Bali 11
Jakarta 12
Lombok 13
Surabaya 14
Bandung 15
16

Contributors

17

2011
Lombok International
Airport - Bandara
Internasional Lombok

Quick Facts

2015
International visitor
arrivals exceeded
9.7 million

First Alila hotel

Alila Jakarta
First Marriott hotel
JW Marriott Jakarta

2002
First Tauzia hotel
Harris Resort Batam
Waterfront

2016
First Carlson Rezidor
hotel Radisson Benoa
and Radisson Legian
Visa waiver for
169 countries
JLL celebrates
35 years in
Indonesia

The Journey
So Far...

Hotel Destinations Indonesia

The tropical island of Bali is a dream destination regularly featured on the cover
of glossy travel magazines. It offers an alluring mix of equatorial landscapes,
white-sand beaches, luxury hotels and resorts, plus dining, shopping and
nightlife. But it wasnt always that way. Tourism and hospitality are relatively
young industries in Indonesia, and Bali is the shining jewel.
In 1971, Indonesias government undertook a study to determine the potential
of Balinese tourism to create employment, support economic development
and place Indonesia on the global travel map. The Bali Tourism Development
Corporation was established to deliver the Nusa Dua Master Plan, and convert
a coastal village in the south of the island into a vibrant destination with
deluxe hotels by Indonesian and global brands, plus conference facilities, golf,
watersports and nightlife.
The success of Nusa Dua resulted in improved infrastructure and more
southern coastal towns being developed for tourism during the 1990s. Chic hotel
resort designs became influenced by Balinese art and culture. As more tourists
arrived, Bali promoted itself assertively to compete with popular Asian island
destinations, such as Phuket and Koh Samui, and new players like Sri Lanka,
Boracay and Langkawi.
In the early 2000s, a commodities-driven economic boom and a soaring
Australian Dollar saw visitation from Australia rise significantly. More recently,
in 2013, Ngurah Rai International Airport was expanded ahead of the APEC
Summit in Nusa Dua to facilitate more flights from Asia and Australia. Combined
with Nusa Dua, thriving resorts like Kuta and Jimbaran, offering fine beaches,
hotels, shopping and nightlife, and surfing hotspot Seminyak, which has
transformed into a gourmet destination, have made Bali the poster child of
Indonesian leisure tourism.
Alongside the high expectations for inbound tourism is a strong, fast-growing
domestic tourism sector. Visitor dynamics are evolving 40 years after Bali kickstarted Indonesian tourism. In 2015, it received 7.15 million domestic visitors,
an 11.77% yearly growth, and four million international visitors. Geographically
close to Bali, Australia has been the premier inbound market, generating almost
one million annual arrivals, followed by Japan, China, Malaysia and South
Korea. Pillar regional markets are now growing fast and hoteliers are predicting
sustained arrivals growth from India.
The good news is that more visitors are coming to Bali each year, not just for
the first time, but also as repeat guests. Conventions and incentives business
are also showing a strong increase year to year, says Ricky Putra, Chairman of
the Bali Hotels Association (BHA), which represents more than 100 star-rated
hotels.
The BHA liaises with Balinese authorities to provide the hospitality sectors
viewpoint on important issues, such as infrastructure development,
sustainability and tourism promotion. The big challenge over the last three
years has been the increased supply of hotel rooms, says Mr Putra. We now
have about 130,000 rooms in Bali, with more hotels opening in 2016. This fast
rate of supply growth has put downward pressure on occupancies and average
rates.
Mirroring the rise of Bali as a holiday retreat, the fast-changing capital Jakarta
has established itself as a business and city-break destination in South East
Asias competitive travel landscape. In recent years, Jakarta has become a
pivotal hub for regional low-cost carriers and international airlines, and its

There are very few places in the world that

can boast the diverse selection of tourism
experiences that Indonesia offers. With
eight sites on the UNESCO World Heritage
List, it offers an abundance of opportunities
in the tourism and hospitality, and its
related investment sectors.
Corinna Toh
Executive Vice President, Strategic Advisory at JLL Hotels & Hospitality Group

dynamic profile as a city of business, leisure and retail has attracted a broadbased hospitality mix comprising international hotel brands and successful
homegrown operators.
The growth of the hotel industry has been very fast in Jakarta and Bali,
which are now well-known destinations, but Indonesia offers a diversity of
exotic experiences, says Djodi Trisusanto, Chief Operating Officer of PT.
Hotel Indonesia Natour, which operates 12 hotels in select locations, including
Jakarta, Bali, Yogyakarta and Medan.
As travel patterns diversify, Indonesia wants visitors to explore more of the
worlds largest archipelago, which comprises 17,508 tropical islands. There
are very few places in the world that can boast the diverse selection of tourism
experiences that Indonesia offers. With eight sites on the World Heritage
List, it offers an abundance of opportunities in the tourism and hospitality, and
its related investment sectors, says Corinna Toh, Executive Vice President
Strategic Advisory at JLL Hotels & Hospitality Group.
With Indonesian tourism on an upward curve, more destinations want to follow
in the footsteps of Bali and Jakarta. We are starting to see more demand
for good quality hotels, especially in the mid-market segment, in places like
Yogyakarta, Lombok, Raja Ampat, East Java and South Sumatra, says Mr
Trisusanto.
From its humble beginnings, the Indonesian tourism industry now plays a
significant role as a pillar of the Indonesian economy. Led by Bali and Jakarta,
the past four decades have witnessed a transformation of tourism and
hospitality in Indonesia.
As incomes grow, more domestic tourists will explore the Indonesian
archipelago, and the accommodation preferences of Asias affluent short-break
vacationers will further evolve. Tourism growth in Indonesia has painted a bright
picture, but hoteliers will need to engage their creative capacities to anticipate
new trends and developments.

05

Whats Next
For Indonesian
Hospitality?

Hotel Destinations Indonesia

Few countries in Southeast Asia have the many distinct cultures, traditions,
natural beauty and vitality of Indonesia. While Bali and Jakarta are shining
examples of the success of Indonesias tourism industry, the worlds largest
archipelago has far more to offer. Mark Edleson, President, Commune Hotels
and Resorts, which includes the ultra-luxe Alila brand commented, Indonesia
still has a lot of exotic destinations, with the history, with the culture, with
natural beauty to be developed, and they are becoming more accessible.
This abundance of opportunity is reflected in Indonesias tourism master
plan which seeks to steer tourists deeper into the wider expanse of Java and
Sumatra as well as Sulawesi, Nusa Tenggara, Maluku and Papua.

Jumping into the fray

Indonesia welcomed almost 10 million arrivals in 2015, with 12 million predicted
for 2016, and a target of 20 million set for 2019. To achieve this, the government
has waived visas for tourists from 169 nations, increased marketing promotions
on destinations and further relaxed foreign ownership rules in tourism-related
assets. And working in favor of the governments plan is the growing interest
among global and Asia Pacific investors for both hotel assets and operating
tourism businesses.
Indonesia now features as a key growth market for most of the global hotel
brands, says Tony Ryan, Managing Director, Global Mergers & Acquisitions at
JLL Hotels & Hospitality Group. While Indonesian hoteliers are more competitive
in the 3- and 4-star market segment, foreign operators typically have a
stronghold in the boutique and luxury category. However this is set to change
as local and foreign hoteliers are looking to expand their footprint across all
segments.
Already, Waldorf Astoria, Rosewood, Six Senses and Langham are planning
to open hotel projects in Jakarta and Bali. Hilton is expanding in Indonesia
with two projects in Surabaya and Marriott is opening its chic boutique brand,
Moxy, in Bandung. Alila, which currently manages eight boutique luxury hotels
and resorts and a luxury cruise in Indonesia, is also opening another hotel
development in Jakarta this year and Bintan in 2017.
Indonesian developers have played a key role in the growth of the industry to
date. Typically, family-owned conglomerates dominate many of Indonesias
large corporations and the tourism/hotel division of the company is often
just one part of a major conglomerate. As the second and third generation of
business leaders evaluate their overall portfolios, restructuring of hotel assets
through disposal, joint venture or rebranding could be effective levers for them
to optimise their holdings, says Adam Bury, Vice President, Investment Sales,
Asia at JLL.
Still, the government will look to address the requirements of investors
including enhancements to land tenure and title, financing, local licensing
and regulatory issues, as well as improving security concerns for the overall
industry, adds JLLs Bury.

Plugging the gap

While there is promising potential to vastly increase the number of destinations
and advance new aspects such as marine tourism, the lack of adequate
infrastructure in Indonesia has been a bottleneck to its development.
The government is already moving to plug the infrastructure gap and has
allocated US$1 billion1 this year to improve safety for land, sea and air transport,
including airport runways, terminals, and air navigation systems. Indonesias
Minister of Transportation Ignatius Jonan also pledged that the government
is committed to build 15 new airports by 2018. Existing terminals and runways
including those in Bali, Jakarta and Labuan Bajo are being upgraded and
expanded to accommodate more flights. Better roads and highways are also
being constructed across the archipelago and ferry services improved to
connect the various islands.
Mark Edleson, reflecting on his more than 40 years working experience in
Indonesia, noted that a successful platform to initiate investment in the

Indonesia now features as a key growth

market for most of the global hotel brands.
Tony Ryan
Managing Director, Global Mergers & Acquisitions at JLL Hotels & Hospitality Group

1970s and 80s was the Nusa Dua project. As part of a master plan for the
development of tourism in Bali2, the project, with good infrastructure and land
titles, brought in the global brands that helped kick-start international tourism.
It also started changing (Bali) from a village-based culture to an attractionbased culture, adds Communes Edleson.
This approach has been replicated in Lombok. Lombok is one area where the
government has outlined to improve tourism infrastructure and you have to give
the government credit that they recognise that, but it doesnt happen overnight,
says Bury.

Changing tourist profile

Over the decades, the tourism industry has grown manyfold in Indonesia. It
commands a large share of the Southeast Asian tourism market (coming in
fourth in travel and tourism competitiveness3 among Southeast Asian countries)
even with increasing competition from emerging destinations such as Vietnam,
Cambodia and Myanmar.
Opportunities for the hospitality sector will emerge as new visitors are
channeled into new tourism hotspots, where land values are cheaper than Bali
and Jakarta. International visitor arrivals in Indonesia rose 4.14 percent in the
first quarter this year to 2.41 million, despite the impact of security concerns
in Jakarta. For the first time in February this year, Mainland China5 became the
top source country for foreign visitors in Indonesia, followed by Singapore,
Malaysia, Australia and Japan. Indeed, a strong and sustainable intra-regional
tourists flow is a positive development. Investors and developers should pay
close attention to the changing travel demographics.
Locally, Indonesias Generation X and Y are increasingly keen to explore
new destinations, both overseas and throughout Indonesia. They travel
independently or in small groups, are heavily influenced by social media and
have specific demands for the design and services at the hotels they choose.
Most of the savvy operators and owners have recognised the need to diversify
demand sources in order to grown and limit the impact of external demand
shocks, says Ryan. Now is the time to look and be ready for the next big
trend.
Recognising the importance of meetings and conventions, the government
recently established an Indonesia Convention and Exhibition Bureau6 to
strategise development of the meetings, incentives, conventions and exhibitions
industry. There is also the potential to further develop Islamic tourism where
there are large visitor numbers from the Middle East, parts of Asia and even the
local market.
With the support of critical government commitments and local and
international expertise and investment, Indonesias tourism industry is going
beyond Bali and Jakarta, to solidify its position as one of the regions preeminent leisure and business destination.
References:
1 Indonesia commits to 15 new airports by 2018, Air Transport World, Nov. 19, 2015
2 The Bali Tourism Development Corporation website, http://www.btdc.co.id/
3 The Travel & Tourism Competitiveness Index Ranking 2015, World Economic Forum data as of 2015
4 Statistics of Foreign Tourist Visits for March, Indonesias statistics bureau, May 2016
5 More Chinese, fewer Australians visit Indonesia, The Jakarta Post, April 1, 2016
6 New bureau to strengthen MICE industry, lure visitors, The Jakarta Post, March 29, 2016

07

1960s

Hotel and Hospitalitys

Timeline

First IHG hotel

InterContinental Bali

1973

1970s
1927
First Inna
Group hotel
Bali Hotel

First Hyatt hotel

Bali Hyatt

Development of the
Nusa Dua integrated
resort project

2001
2013
Bali International
Airport upgraded

2011
Lombok International
Airport - Bandara
Internasional Lombok

2014
Easing of visa requirements for foreign visitors
Initiative to upgrade ten tourist destinations:
Lake Toba (North Sumatra), Tanjung Kelayang
(Belitung), Tanjung Lesung (Banten), the Thousand
Islands (Jakarta), Borobudur Temple (Magelang),
Mount Bromo (East Java), Mandalika (South Lombok),
Labuan Bajo (East Nusa Tenggara), Wakatobi
(Southeast Sulawesi), and Morotai (North Maluku)

Legends
Hotel Openings
Other Developments
Transportation
Visitor Arrivals

2015
International visitor
arrivals exceeded
9.7 million

First Alila hotel

Alila Jakarta
First Marriott hotel
JW Marriott Jakarta

2002
First Tauzia hotel
Harris Resort Batam
Waterfront

2016
First Carlson Rezidor
hotel Radisson Benoa
and Radisson Legian
Visa waiver for
169 countries
JLL celebrates
35 years in
Indonesia

1985

1979
First Mandarin
Oriental hotel
Mandarin Oriental
Jakarta

First Melia hotel

Bali Sol Hotel

1981
JLL expands into
Indonesia in association
with PT Procon Indah

1976

1991
First Starwood hotel
Sheraton Senggigi Beach
Resort Lombok and Sheraton
Laguna Hotel Bali

First Hilton hotel

Hilton Jakarta

1994
First Accor hotel
ibis Jakarta Kemayoran
First Shangri-La hotel
Shangri-La Jakarta

1997
2000s
Proliferation of
Low Cost Carriers

1995

JLL in Surabaya

First Four Seasons hotel

Regent Jakarta

1998

JLL in Bali

First Archipelago hotel Grand Aston Bali

2018
18th Asian Games
Jakarta-Palembang
15 new airports across
Indonesia and the Light
Rail Transit in Jakarta

2019
Targets 20 million
international visitor arrivals

10

Hotel Destinations Indonesia

Indonesias
Key Destinations

Jakarta

Bandung

Surabaya

Bali

Lombok

Hotel Destinations Indonesia

11

Bali
Known as the island of the gods, Bali is one of the most popular tourist
destinations in the world. Few places on earth are blessed with the
amount of sandy beaches, rugged coastlines, lush rice terraces, barren
volcanic hillsides, panoramic views, art galleries, local traditions,
culture and nightlife that Bali has to offer. On top of all this, Bali is
benefiting from increased domestic and international visitor arrivals
thanks to continuous infrastructure improvements, increased air
connectivity and a relaxation of visa requirements.

HIGHLIGHTS

Tourism

Demand

Supply

Outlook

For the tenth consecutive year,

international visitor arrivals to Bali
increased year-on-year (y-o-y) in 2015.
Despite the flight disruptions caused
by the volcanic eruptions of Mount
Raung and Mount Rinjani during 2015,
international visitor arrivals to Bali
increased 6.2% y-o-y to reach
four million. The growth in visitor
arrivals can be attributed to the easing
of visa requirements, which as of April
2016 is applicable to nationals of
169 countries.

In 2015, the fastest growing source

markets to Bali were the United
Kingdom, United States and Mainland
China, which increased 31.9%, 19.8%
and 17.3% y-o-y respectively, due to the
visa waiver initiatives. As at YTD March
2016, visitor arrivals from Mainland
China increased 29.0% y-o-y, overtaking
Australia as the leading source market
to Bali. Together, Mainland China and
Australia accounted for approximately
45.9% of all international visitor arrivals
as at YTD March 2016.

From 2016 to 2019, the upcoming supply

of international branded hotels in Bali
is estimated at 9,500 rooms, which
will increase by a compound annual
growth rate (CAGR) of 9.1%, if all hotels
materialise. Notable new hotel brands
expected to debut in the next few years
include Six Senses, Rosewood and the
Waldorf Astoria.

Moving forward, visitor arrivals are

expected to increase, facilitated by
improvements in air connectivity,
the implementation of the visa-free
policy for citizens of 169 countries
and the boost in Indonesias annual
tourism marketing budget to three
trillion Rupiahs. In the medium term,
the supply pipeline is significant and is
likely to place pressure on the overall
hotel market performance, however
growing demand will gradually absorb
incremental supply.

NEW HOTELS

292
306
rooms
NOTABLE HOTEL DEALS
Tune Hotels Bali Portfolio
The Villas Bali Hotel & Spa

Hilton Garden Inn Bali

Ngurah Rai Airport

240
rooms
Alila Seminyak Bali

222

rooms

Wyndham Tamansari
Jivva Resort Bali

QUICK FACTS
UPCOMING HOTELS
Renaissance Bali Uluwatu Resort &
Spa (2016)
Mvenpick Resort & Spa Jimbaran
Bay (2016)
The Westin Ubud Resort & Spa (2017)

4.0 million

International Visitor
Arrivals (2015)

2,785 rooms

Number of New Rooms^

(2015)

62.9%
Occupancy

Note: Bali hotels refer to upscale stock

Source: STR Global (YTD March 2016), Bali Government Tourism Office, JLL
ADR - Average daily rate, RevPAR - Revenue per available room

134
rooms
ibis Styles Bali
Petitenget

IDR

1.9 million
ADR

60

rooms

Mandapa, a Ritz
Carlton Reserve

IDR

1.2 million
RevPAR

^ Statistics Indonesia - Number of rooms in classified hotel in Bali Province

12

Hotel Destinations Indonesia

Jakarta
Primarily a city of government, business, industry and trade, Jakarta
is also the main gateway to Indonesias many tourism destinations.
Although the capital of the worlds fourth most populous nation is
seldom viewed as a centre for tourism and culture itself, efforts to
improve the citys reputation as a service and tourism city have been
stepped-up. In recent years, Jakarta has expanded its facilities for
visitors by developing new multi-star luxury hotels, entertainment
centres, fine restaurants as well as tourist attractions in an effort to
boost visitor arrivals.

HIGHLIGHTS

Tourism

Demand

Supply

Outlook

As the national capital, Jakarta

remains a key business gateway in
Indonesia and an important corporate
destination. As at YTD March 2016,
visitor arrivals decreased 3.5% y-o-y,
due to the bombing in January 2016.
Nevertheless, the governments ongoing
commitment to ease visa requirements
together with the increase in flight
connectivity between Jakarta and major
gateway cities, including new flights
to Guangzhou as of August 2015 and
London as of March 2016, will help to
boost visitor arrivals.

In 2015, international visitor arrivals to

Jakarta grew modestly by 2.6% y-o-y to
reach 2.3 million. The majority of the top
10 source markets registered increases
including Mainland China (+23.3%
y-o-y) and South Korea (+11.7% y-o-y)
driven by the governments visa waiver
policies. Additionally, the development
of Shariah tourism has also supported
the increase in tourists from Middle
Eastern countries, with Saudi Arabia
registering a 7.8% y-o-y increase
in 2015.

Majority of the new supply which

entered the market in 2015 was in the
economy and midscale sector with the
exception of the 173-room Raffles Hotel
and the 380-room Fairmont Hotel which
were the only two luxury hotel openings.
Looking forward, approximately 2,300
international branded hotel rooms are
expected to enter the market in 2016,
representing a y-o-y increase of 6.0% if
all projects materialise. Notable luxury
hotel openings in the pipeline include
the 283-room The Westin Jakarta
and the 125-room Four Seasons Hotel
Jakarta.

In the lead up to the 2018 Asian Games,

which will be hosted in Jakarta, the
citys tourism market will benefit from
increased air connectivity and improved
public infrastructure, including the
development of a light rail system.
Hotel trading performances is likely to
remain modest due to the significant
supply of new hotels expected to enter
the market over the next few years.
Nevertheless, the entry of new hotel
brands will help to diversify the tourism
offerings which, in conjunction with the
visa waiver policies, will help to boost
visitor arrivals.

NEW HOTELS

505
306
rooms
NOTABLE HOTEL DEALS

Grand Mercure Jakarta

Kemayoran

380
rooms
Fairmont Jakarta

293

rooms

Sheraton Grand Jakarta

Gandaria City

QUICK FACTS
UPCOMING HOTELS
Four Points by Sheraton Jakarta,
Thamrin (2016)
Four Seasons Hotel Jakarta (2016)
The Westin Jakarta (2016)

2.3 million

International Visitor
Arrivals (2015)

3,507rooms

Number of New Rooms

(2015)^

Note: Jakarta hotels refer to upscale stock

Source: STR Global (YTD March 2016), Statistics Indonesia, JLL
ADR - Average daily rate, RevPAR - Revenue per available room

52.2%
Occupancy

173
rooms
Raffles Jakarta

IDR

2.3 million
ADR

160
rooms
Holiday Inn Express
Jakarta Wahid
Hasyim

IDR

1.2 million
RevPAR

^ Statistics Indonesia - Number of rooms in classified hotel in DKI Jakarta

Province

Hotel Destinations Indonesia

13

Lombok
Located to the west of Bali, Lombok is a tropical island in the West
Nusa Tenggara province of Indonesia. Offering natural landscapes, a
traditional way of life and diverse flora and fauna, Lombok has captured
the growing attention of domestic and international visitors. In recent
years, Lomboks popularity as a resort destination has increased as
travellers relish in the tranquillity and natural beauty that the island has
to offer.

HIGHLIGHTS

Tourism

Demand

Supply

Outlook

Since the construction of the new

Bandara International Lombok Airport
in October 2011, international visitor
arrivals to Lombok have surged. From
2011 to 2015, international arrivals
increased by a compound annual
growth rate (CAGR) of 40.7%. In 2016,
the government earmarked Lombok
as one of ten emerging destinations
in Indonesia, which will further boost
the attractiveness of the Island to both
foreign and domestic visitors.

In 2015, international visitor arrivals to

Lombok increased marginally by 0.5%
y-o-y, as demand was temporarily
dampened due to the volcanic activity
from Mount Rinjani in November 2015.
Nevertheless, the market has quickly
recovered as reflected in the robust
growth in visitor arrivals during the first
quarter of 2016, increasing 42.3% y-o-y.

The majority of existing hotel supply

in Lombok comprise locally branded
owner-operator hotels and resorts.
International branded hotels are limited
and currently include the Sheraton
Senggigi, the Oberoi Lombok and the
Novotel Lombok. Looking forward, the
development the Mandalika Project, an
integrated tourism hub, will feature a
number of international branded hotels
including the 250-room Pullman and the
400-room Club Med as well as luxury
residences, a golf course and various
retail and dining facilities.

Moving ahead, visitor arrivals to Lombok

are expected to grow, driven by the
governments visa waiver policies and
increased destination marketing efforts
including the promotion of halal tourism
to attract Middle Eastern tourists.
The Mandalika Project is expected to
facilitate tourism growth in Lombok, if
it successfully completes, and further
demonstrates the governments ongoing
willingness to invest in the tourism
industry outside of Bali and Jakarta.
Improved infrastructure and the entry of
international hotels under the proposed
development is expected to enhance
the tourism offering and landscape of
Lombok.

NEW HOTELS

164
rooms
NOTABLE HOTEL DEALS

Golden Tulip Hotel

138
rooms
Zmax D Hotel Praya

104
rooms
Katamaran Resort

QUICK FACTS
UPCOMING HOTELS
Melia Lombok Tangkong (2018)
Pullman (2018)
Renaissance Lombok Gili Trawangan
(2020)

70,217

International Visitor
Arrivals (2015)

793 rooms

Number of New Rooms

(2015)^

Note: Lombok hotels refer to marketwide stock

Source: Tourism Industry Association, Statistics Indonesia, JLL
ADR - Average daily rate, RevPAR - Revenue per available room

68.0%
Occupancy*

IDR

1.3 million
ADR*

IDR

911,000
RevPAR*

^ Statistics Indonesia - Number of rooms in classified hotel in Nusa

Tenggara Barat Province
* Based on JLL estimates of Lombok Resorts 2015

14

Hotel Destinations Indonesia

Surabaya
Known as the city of heroes due to the historical battle for Indonesias
independence, Surabaya is one of the countrys key economic and
commercial centres. With a population of approximately 2.8 million,
Surabaya is the second largest city in Indonesia. The city has a wellestablished infrastructure system and is accessible by land, sea and air
transportation systems. Surabaya is also one of South-East Asias busiest
seaports, facilitating a range of principal exports including sugar,
tobacco and coffee.

HIGHLIGHTS

Tourism
In 2015, Surabaya welcomed
approximately 200,851 international
visitors. According to the Directorate of
Civil Aviation, domestic travellers account
for approximately 90% of total arrivals. In
2013, the Surabaya Juanda International
Airport completed its expansion with the
construction of Terminal Two which is
now dedicated to serving international
flights. Currently, Surabaya is serviced
by international flights to Singapore,
Malaysia and Hong Kong.

Demand

Supply

Outlook

As one of the primary business

destinations after Jakarta, Surabayas
tourism market is dominated by
corporate and meetings, incentives,
conventions and exhibitions (MICE)
demand, especially from the domestic
market. Surabaya is also a domestic
leisure destination popular for its retail
offerings and is the gateway to Mount
Bromo, a popular tourist attraction,
approximately four hours drive from the
city.

The existing hotel supply in Surabaya

is currently dominated by local owner
operator hotels. In 2015, the majority
of the supply additions to the market
were in the economy and midscale
sector including the 236-room Holiday
Inn Express Surabaya Centre Plaza and
the 132-room Ibis Styles Jemursari.
International hotel brands expected to
debut over the next few years include
the Four Points by Sheraton and the
Doubletree by Hilton Surabaya.

Improvements to infrastructure and

new visa-free entries for key source
markets are expected to support
international visitor arrivals to Surabaya
in 2016 and beyond. Given the strong
presence of manufacturing, trade and
industries within the city, Surabayas
tourism market is expected to continue
to be dominated by domestic corporate
demand which will benefit from a
stronger economic growth outlook.

NEW HOTELS

236
rooms
NOTABLE HOTEL DEALS

Holiday Inn Express

Surabaya Centre Plaza

132
rooms
ibis Styles Jemursari

129
rooms
Premier Inn Surabaya
Airport

QUICK FACTS
UPCOMING HOTELS
Four Points by Sheraton (2016)
DoubleTree by Hilton Surabaya (2017)

IDR

200,851 2,017 rooms 53.0% 400,000

International Visitor
Arrivals (2015)

Number of New Rooms

(East Java) (2015)^

Occupancy*

Note: Surabaya hotels refer to midscale and economy stock

Source: Based on JLL estimates (YTD March 2016), Statistics Indonesia
ADR - Average daily rate, RevPAR - Revenue per available room

ADR*

IDR

212,000
RevPAR*

^ Statistics Indonesia - Number of rooms in classified hotel in Jawa Timur

(East Java) Province
* Based on JLL estimates 2015

Hotel Destinations Indonesia

15

Bandung
The picturesque city of Bandung, capital of West Java, is imbued
with lush highlands and a temperate climate. With a diverse retail
and culinary offering, the city is a popular weekend and staycation
destination for domestic tourists. Bandung is also one of Indonesias
burgeoning information technology centres and features a vibrant
culture of music, fashion and arts. Given its close proximity to Jakarta,
Bandung is also an attractive MICE destination and the city has been
host to a number of international summits including the recent AsianAfrican Conference in 2015.

HIGHLIGHTS

Tourism

Demand

Supply

Outlook

Located approximately two hours

drive southeast of Jakarta, Bandung
is an ideal retreat and weekend
destination for domestic and foreign
tourists. In 2015, approximately 160,000
international visitor arrivals arrived
via Bandungs Husein Sastranegara
International Airport, representing
an 11.5% y-o-y decline from 2014.
The decline in arrivals may be
attributed to the reduction of
Air Asias flight frequency between
Bandung and Singapore.

Visitor arrivals to Bandung are largely

dominated by domestic demand due
to the citys popularity as a staycation
weekend destination with its plethora
of affordable shopping outlets and cool
temperate climate. In addition to leisure
tourism, corporate and MICE demand
are becoming increasingly popular
given the ease of access from
Jakarta to Bandung.

According to the Bandung Tourism

Authority, there are currently 275 hotels
in Bandung, the majority of which are
budget and midscale hotels. In 2015,
several international branded hotels
opened, including the 193-room Best
Western Premier and the 270-room
Crowne Plaza Bandung. Looking
forward, the supply of international
hotel brands are expected to increase
gradually. This includes the debut of
new brands such as the Moxy Bandung
and the Innside by Melia, both of which
are scheduled to open in 2017.

Given Indonesias youthful demographic

mix and the rising affluence of the middle
class, domestic tourism to Bandung is
expected to remain robust in the medium
term. Combined with Bandungs proximity
to Jakarta and the availability of low
cost carrier to many domestic cities,
visitor arrivals is forecast to increase in
the future. Furthermore, infrastructure
development including the construction
of the countrys first high-speed railway
connecting Bandung and Jakarta,
scheduled to complete by the end of
2019, will help improve accessibility to
Bandung.

NEW HOTELS

270
rooms
NOTABLE HOTEL DEALS

Crowne Plaza
Bandung

193
rooms
Best Western Premier
La Grande Hotel
Bandung

162
rooms
Four Points by Sheraton
Bandung

QUICK FACTS
UPCOMING HOTELS
Innside by Melia (2017)
Moxy Bandung (2017)

IDR

159,647 3,298 rooms 50.0% 448,000

International Visitor
Arrivals (2015)

Number of New Rooms

(West Java) (2015)^

Note: Bandung hotels refers to marketwide stock

Source: Tourism Industry Association, Statistics Indonesia, JLL
ADR - Average daily rate, RevPAR - Revenue per available room

Occupancy*

ADR*

IDR

224,000
RevPAR*

^ Statistics Indonesia - Number of rooms in classified hotel in Jawa Barat

(West Java) Province
* Based on JLL estimates 2015

16

Hotel Destinations Indonesia

Quick Facts
International visitor arrivals 2015

INDONESIA

VIETNAM

9.7 million

7.9 million

MALAYSIA

MAINLAND CHINA

SOUTH KOREA

MAINLAND CHINA

MALAYSIA

SINGAPORE

INDONESIA

KOREA

USA

THAILAND

MAINLAND CHINA

i 6.3% y-o-y

h 10.9% y-o-y

1.3 million
MYANMAR

h 20.5% y-o-y

5.4 million
PHILIPPINES

SINGAPORE

h 0.9% y-o-y

25.7 million
MALAYSIA

h 3.1% y-o-y

29.8 million
THAILAND

Top 3 source markets in 2015

h 15.0% y-o-y

18.4%

22.7%

26.6%

50.3%

25.0%

15.7%

15.7%

14.2%

11.4%

10.8%

14.5%

11.4%

AUSTRALIA

12.0%

JAPAN

8.6%

JAPAN

4.6%

MAINLAND CHINA

6.5%

JAPAN

9.2%

JAPAN

6.9%

Hotel Destinations Indonesia

Contributors
Mike Batchelor

Tony Ryan

Corinna Toh

Adam Bury

Managing Director
Investment Sales
mike.batchelor@ap.jll.com

Executive Vice President

Strategic Advisory
Asia
corinna.toh@ap.jll.com

Alison Li

Associate
Strategic Advisory
Asia
alisonx.li@ap.jll.com

For further enquiries on hotel and hospitality advisory and investment opportunities in Indonesia, kindly contact:

Corinna Toh

Executive Vice President

Strategic Advisory
corinna.toh@ap.jll.com
+65 9617 3107

Adam Bury

Vice President
Investment Sales Asia
adam.bury@ap.jll.com
+65 8313 4600

Managing Director
Global Mergers & Acquisitions
tony.ryan@ap.jll.com

Vice President
Investment Sales
Asia
adam.bury@ap.jll.com

17

Tengger Semeru National Park, East Java, Indonesia

About JLL Hotels & Hospitality Group

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have helped more hotel investors, owners and operators achieve high returns on their assets than any other real estate advisor in the world. Whether you are looking for a
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To find out more, talk to JLL.
www.jll.com/hospitality

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2016 Jones Lang LaSalle IP, Inc. All rights reserved. All information contained herein is from sources deemed reliable; however, no representation or warranty is made to the accuracy thereof.