Indonesia Budget Hotel Sector is Booming

Growing Indonesian Domestic Travel Market Create Demand for Budget Hotels.

The Indonesian hotel industry is discovery the strong potential for revenues and profits to be earned form the country's growing budget hotel sector.

As reported by Bisnis Indonesia, Ferry Salanto, the Research Division Manager of Colliers International, 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.

Said Salanto, "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."

He explained that the major attraction for guests staying at budget hotel is linked to prices that range between Rp. 250,000 to Rp, 400,000 (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.

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