Booming Budget Hotels
The Indonesian hotel industry is discovering the strong potential for revenues and profits to be earned form the country’s growing budget in hotel sector.
There are points to the large number of relatively new players in the budget hotel sector, including: Amaris, Tune, Whiz, Pop Harris and Formule1.
Investors are attracted to the budget hotel sector because of the relatively low investment required and a demonstrated ability to maintain high occupancies.
Over the past three years, the ‘budget hotel’ segment has grown and will continue to do so in the future, particularly in large cities which are a transit point for traders – such as Surabaya, Jakarta, Batam, Yogyakarta and other cities.
The major attraction for guests staying at budget hotel is linked to prices that range between US$27.75 – US$44.50 per night.
Investors are also often building budget hotels in close proximity to shopping centers, which compensates for the lack of restaurants and other attractions found in larger, starred hotels.