Indonesia’s hospitality industry set for expansion as tourism rebounds
With a surge in foreign tourists and increased MICE activities, Indonesia’s hospitality sector is gearing up for a prosperous year
Indonesia’s tourism and hospitality sectors are poised for significant growth in 2024, driven by a robust increase in foreign tourist arrivals and an optimistic outlook for business and leisure travel.
According to VN Express International, the country welcomed over three million foreign tourists in the first quarter of 2024, marking the highest number of foreign visitors in four years. This represents a 25.4 percent increase compared to the same period in the previous year, underscoring a strong recovery trajectory.
Amalia Adininggar Widyasanti, Acting Head of Indonesia’s Central Statistics Agency (BPS), highlighted that Bali continues to be the top destination, accounting for 44.5 percent of the total foreign tourist arrivals through Ngurah Rai Airport. The majority of these tourists came from Malaysia, Australia, Singapore, and China, illustrating Indonesia’s broad international appeal.
Positive performance outlook for business and leisure hotels
The hospitality industry is set to benefit significantly from the resurgence in both business and leisure travel. According to a report by Colliers International, the positive performance outlook for business hotels in 2024 is largely driven by the Meetings, Incentives, Conferences, and Exhibitions (MICE) sector, which is seeing a resurgence in both the private and government sectors.
Resort hotels are also expected to thrive, fuelled by the enduring trend of family vacations. In a separate report, Colliers anticipates an increase in the number of family-type rooms, catering to the growing demand for family-friendly accommodations. This aligns with the broader trend of leisure demand continuing to drive the recovery of the hospitality sector.
Related: Navigating Bali’s real estate market: A strategic business outlook
Surge in spa, wellness, and entertainment sectors
Entertainment and wellness sectors are also projected to experience a substantial boost. Colliers highlights an expected increase in demand for spa services, wellness entertainment, sports clubs, and sports entertainment. This trend is leading to a notable rise in the number of these outlets opening across the country in 2024 compared to the previous year. Furthermore, golf has emerged as a new favourite pastime among the younger generation, contributing to the growth of golf-related businesses.
Influx of foreign food and beverage brands
The Food and Beverage (F&B) sector is also witnessing a significant transformation with an influx of well-established foreign brands entering the Indonesian market. In the same report, Colliers mentioned that F&B businesses with strong brand recognition are considered more sustainable, which has led to a growing prevalence of foreign F&B brands in Indonesia. This trend is expected to continue and further bolster the hospitality industry’s overall growth.
Recognising excellence in hospitality and real estate
With the hospitality industry growing, the 9th PropertyGuru Indonesia Property Awards celebrated several key players in the sectors in 2023; leading developers that will play a key role in the industry’s growth this year. Paramount Land was named the Best Commercial Developer, Agung Sedayu Group received the accolade for Best Hospitality Developer, and PT. BSD Diamond Development nabbed the Best Lifestyle Developer honour. Notably, the St. Regis Hotel Jakarta by PT. Permadani Khatulistiwa Nusantara, a member of the Rajawali Property Group, was honoured with the Best Hotel/Resort Development award, while the Living World Denpasar Bali by Kawan Lama Group won the Best Retail Development title.
As Indonesia continues to recover from the pandemic’s impact, the country’s hospitality and tourism sectors are poised for a strong resurgence this year. The significant increase in foreign tourist arrivals, coupled with the positive outlook for business and leisure travel, underscores the potential for robust growth. With ongoing investments and the introduction of new entertainment and wellness options, Indonesia’s hospitality industry is well-positioned to capitalise on these trends and deliver a memorable experience for both domestic and international travellers.
Know any award-worthy residential, commercial, or industrial projects in the country? Nominate them for the 10th annual PropertyGuru Indonesia Property Awards on or before 31 May 2024. To know more, visit AsiaPropertyAwards.com/Award/Indonesia/.
Gynen Kyra Toriano, Digital Content Manager at PropertyGuru, wrote this article. For more information, email: [email protected].
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