The proliferation of boutique and mid-tier hotels in Asia

But for the Covid-19 pandemic bringing global travel and hospitality sector to an abrupt standstill – and subsequent decline – the boutique budget to mid-tier hotels segment in Asia was set for a few bumper years ahead from 2020 onwards. In cities across Asia from Bangkok, Ho Chi Minh, Da Nang and Kuala Lumpur in South East Asia to those in Greater China including Hong Kong, Taipei and Shanghai and innumerable Chinese cities, and those in Korea, Japan and India, the last half a dozen or so years had seen the massive emergence of mid-range hotels. Often dubbed ‘boutiques’, these were clean, functional and modern hotels that slotted in somewhere in between a 2-star and a 4-star in conventional terms. At long last, a clear and practical hospitality segment that was only moderately exploited for close to 20 years ever since the big Asian travel boom began in the late 90s, was getting its due attention and investment from property developers and hotel operators alike.

Tourists and business travelers resuming travel after a pandemic are unlikely to go splurging on luxury properties when many such travelers and businessmen themselves have been through tough times financially.

Many of these hotels were designed to cater to a mix of ever-expanding tourist traffic within and into Asia, as well as business executives working for small and medium businesses who were frequent travelers on short visits. And both of these categories of travelers were set to grow exponentially in coming years leading to very promising forecasts for the hospitality as well as the related food service industries in Asia. AMA had – prior to the pandemic – dealt with several such hospitality clients as well as clients in other sectors that had stayed in such boutique hotels.

However, post-pandemic, depending on whenever frequent travel resumes (conservative estimates put it at 2023) and reaches 2019 levels again (likely by 2025), the hospitality sector is inevitably having to through a reboot and reset currently. One thing the reboot is very likely to do is potentially offer very promising prospects for the boutique hotels sector. Tourists and business travelers resuming travel after a pandemic are unlikely to go splurging on luxury properties when many such travelers and businessmen themselves have been through tough times financially. Therefore, all may not be lost yet for some of the smaller great properties that had come up all over Asia making convenient luxury affordable for a lot of travelers. And we at AMA remain ready to help hospitality clients as and when business returns to moderate levels in the years ahead.