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Maldives’ Outlook Downgraded Despite Tourism Recovery

Alan Woinski
October 17th, 2022 at 7:34 AM EDT

Skift Take

  • Fitch Ratings revised the Maldives’ outlook to Negative from Stable while affirming its Long Term Currency Issuer Default Rating at B-.
  • Hilton announced plans to expand the presence of Conrad Hotels & Resorts through Conrad Singapore Orchard.
  • Singapore’s Far East Organization is planning to develop a new hotel in Sydney’s Rocks district, with a proposal to redevelop the Clocktower Square with a luxury new property.

Fitch Ratings revised the Maldives’ outlook to Negative from Stable while affirming its Long Term Currency Issuer Default Rating at B-. The outlook revision reflects Fitch’s assessment that tightening global financial conditions are intensifying the Maldives’ external liquidity strains, even though tourism has recovered to pre-pandemic levels. Fitch believes a sharp decline in foreign-exchange buffers, if sustained, could complicate the government’s external debt-servicing and maintenance of the currency peg to the US dollar. The ratings agency also balanced the Maldives’ strong GDP growth and some favorable structural indicators, such as per-capita GDP, relative to B peers, against a high government debt burden and its vulnerability to shocks that could undermine prospects for tourism. The main reason for the lower outlook is gross foreign reserves fell from US$1,017 million a year ago to US$540 million in September 2022. Fitch expects reserve buffers to remain low in coming quarters with US$214 million in sovereign external debt servicing obligations and US$151 million in publicly guaranteed external debt obligations due in 2023. Fitch expects Maldives’ fiscal deficit to widen to 15.7% of GDP in 2022.

Hilton announced plans to expand the presence of Conrad Hotels & Resorts through Conrad Singapore Orchard. The hotel is jointly owned by Pontiac Land Group (75%) and Kajima Development (25%) and will be a rebrand of Regent Singapore. The Conrad Singapore Orchard will be the second Conrad Hotels & Resorts property in Singapore managed by Hilton, joining Conrad Centennial Singapore. It will be the fourth hotel to be managed by Hilton in Singapore. The hotel is set to open in two phases. The hotel’s meeting spaces and its 10 restaurants and bars, including Manhattan, Basilico and Summer Palace, are poised to welcome guests from January 1, 2023. Following extensive room refurbishments, the hotel is scheduled to open fully in Q1 2024. Conrad Singapore Orchard will feature 440 guest rooms starting from 36 square meters. The hotel will also offer a fitness center and over 1,600 square meters of event spaces. For Hilton this follows two recent signings for the Conrad brand to debut in the major cities of Kuala Lumpur, Malaysia and Nagoya, Japan.

Singapore’s Far East Organization is planning to develop a new hotel in Sydney’s Rocks district, with a proposal to redevelop the Clocktower Square with a luxury new property. A new, high-end 200-room hotel has been proposed by Far East at The Rocks, as well as new food, beverage and retail outlets. The development will be across a space of 3,599 square meters. This will include a rooftop space offering panoramic views of Sydney Harbour and its surroundings. As we noted previously, Far East’s plans would be for the site that includes the 61-room Rendezvous Hotel. The Clocktower structure is the highest point in The Rocks Place Management NSW is the freehold owner of the site, with Far East a long-term leaseholder. The development is one of a series of hotel proposals in Sydney, with Mulpha planning a four-star hotel in Sussex St. and operator Accor just opening the Porter House Hotel and the rebranded Mercure Sydney Martin Place.

Accor said it’s expanding its presence in Indonesia by signing two hotels at the new Yogyakarta International Airport. The opening of Novotel and ibis New Yogyakarta International Airport Kulon Progo will mark the arrival of the two hotel brands to the gateway of Yogyakarta. The dual-branded project is located only a five minutes’ drive from the airport and about 45 minutes from Yogyakarta city center. It will feature a total of 413 keys in a single development, with two distinctive wings connected by an elegant façade. Each property will have its own unique design and dedicated facilities, while sharing back-of-house areas to enhance efficiency. Novotel New Yogyakarta International Airport Kulon Progo will have 189 guest rooms, along with a swimming pool, children’s pool, kids’ area, spa and fitness center. There will be a restaurant and bar along with two floors of meeting space. The ibis New Yogyakarta International Airport Kulon Progo will feature 224 rooms in a nine-story glass and aluminum tower. Dedicated facilities will include a lobby lounge, gym, kids’ room, nursery and an all-day restaurant. There will be three meeting rooms and a pre-function area. The two new build hotels are owned by PT. Lentera Prosper Indo and will be managed by Accor. The dual-branded property is scheduled to open its doors in the fourth quarter of 2023. Accor is considered the leading international hotel operator in Indonesia with 130 hotels and a pipeline of 53 projects across the country. They have five existing hotels in Yogyakarta.

The Vivanta Meghalaya, Shillong was inaugurated this past Friday. The property is owned by the Meghalaya Tourism Development Corporation and has been leased out for a period of 33 years on a PPP mode to be operated by the Indian Hotel Company Limited. The hotel has 101 rooms and other facilities including a specialty restaurant, coffee shops, bar, retail shops and a banquet hall.

JLL Hotels & Hospitality Group sold the Stamford Plaza Auckland property to a consortium including the CP Group in association with Alvarium Investments and Archipelago Capital. This is the largest single hotel asset in New Zealand to go unconditional, according to Co-Star’s HNN, sold at a cost of NZ$170 million.

Six Senses announced their reopenings in Cambodia and Bhutan. In Bhutan, Six Senses is made up of five lodges, Six Senses Thimphu, Punakha, Paro, Gangtey and Six Senses Bumthang. In Cambodia, Six Senses announced the reopening of Six Senses Krabey Island, just a 10 minute drive from Sihanouk International Airport. The resort will reopen on December 2 with 40 spacious pool villas, a spa, food and beverage options and more.

The casino regulator in New South Wales has hit Star Entertainment Group Ltd. with a A$100 million fine and suspended the company’s casino license. The property will not close as the regulator suspended their license but appointed a manager to oversee the casino. This is exactly what was expected, following a similar situation with Crown Resorts. The biggest issue that was uncovered during the hearings with Star were the anti-money laundering protocol failures. The NSW regulator appointed Nicholas Weeks as manager and said there is a chance for Star to remediate its business to the point where it becomes suitable again to hold a license. Star did the same thing as Crown when they were caught with their past misdeeds, cleaned house of all management and directors on the both corporate and property level. The difference is that Crown wound up being sold to Blackstone Group. For now, there are no reports of anyone wanting to buy Star.

Delta Hotels by Marriott announced its launch in Qatar with the opening of Delta Hotels by Marriott City Center Doha. The hotel is located in the West Bay area, close to key business and destination hubs such as the Doha Exhibition Convention Centre, Diplomatic and Financial Districts and the City Center Mall. The 32-story hotel is home to 320 modern and spacious rooms, culinary offerings, more than 850 square meters of event space, an outdoor pool, fitness center and the Emerald Spa.

Alan Woinski
October 17th, 2022 at 7:34 AM EDT

Companies: Accor, Blackstone, Conrad Hotels & Resorts, CP Group, Crown Resorts, Delta Hotels & Resorts, Far East Organization, Hilton Hotels & Resorts, ibis, JLL, Marriott International, Mercure Hotels, Novotel, Pontiac Land Group, Six Senses, The Indian Hotels Company Ltd

Locations: Auckland, Australia, Bhutan, Cambodia, Doha, Indonesia, Maldives, Qatar, Singapore, Sydney, Yogyakarta

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