By most measures, 2024 was a good year for Singapore’s tourism industry. Visa-free travel arrangement with China helped drive up numbers. Taylor Swift’s sellout concerts were a draw too. However, this high base makes it tough for the industry to repeat similar growth this coming 2025, says DBS Group Research’s Geraldine Wong.
“We believe that going into 2025, Singapore hotels are near the tail end of pandemic recovery with more modest RevPAR outlook in 2025 at 2%–3% on our expectations,” she adds.
Nonetheless, analysts like Wong are keeping an eye on upcoming developments from an industry that is actively keeping its offerings updated and fresh.
To this end, Singapore’s two integrated resorts (IRs), Resorts World Sentosa (RWS) and Marina Bay Sands (MBS), are spending billions each to build more rooms, facilities and introduce new experiences. When both IRs are done spending billions on their expansion plans, the market is expecting the local tourism scene to see a boost.
Darren Chan, senior research analyst at Phillips Securities Research, says: “We expect the new attractions and facilities to attract a broader spectrum of visitors and drive tourist arrivals, which is still 12% below pre-Covid 2019 levels. These developments are also expected to create thousands of jobs and stimulate economic growth.”
According to him, now is a good time for the two IRs to proactively expand and redevelop their offerings. These strategic moves will help drive future tourism growth, ensuring Singapore remains a top destination for tourists worldwide.
See also: ISDN banks on 'triangle of solutions' from motors to robots for growth
“We remain optimistic about the outlook for Singapore’s IRs and the tourism industry. We expect international visitor arrivals to reach pre-Covid levels in 2025,” says Chan, who likes Far East Hospitality Trust (FEHT) as a beneficiary of this expansion.
FEHT has investments in three hospitality properties in Sentosa that are separate from RWS. These are Village Hotel Sentosa, The Outpost Hotel Sentosa and The Barracks Hotel Sentosa. “FEHT is primed to benefit from improving international visitor arrivals with its balanced mid-to-upper scale hotel offerings in Singapore. We have a ‘buy’ rating on FEHT with a target price of 75 cents,” adds Chan.
Genting’s gameplan
See also: Plaza Premium elevates travel experience by constantly fine-tuning F&B offerings
Counters like FEHT stand to benefit from RWS’s expansion plans. First announced by Genting Singapore (GENS) in 2019, the expansion of RWS, dubbed RWS 2.0, will see a mix of new attractions, entertainment and lifestyle offerings to the destination resort.
As part of RWS 2.0, GENS, on Nov 10, 2023, announced it will be investing $6.8 billion over eight years towards the redevelopment and expansion. “We are confident this investment will anchor RWS as Asia’s most sought-after tourism destination and propel the group’s strong future growth. The investment will be funded through internal resources and is not expected to have a material impact on the company’s earnings in the near term,” says GENS in its annual general meeting (AGM) held on April 18.
“As we progress with RWS 2.0 developments, RWS will be unveiling new and elevated visitor experiences progressively in phases,” adds GENS in emailed comments. Already, it has launched Asia’s first Harry Potter: Visions of Magic experience in November and the development of Universal Studios Singapore’s new themed zone, Illumination’s Minion Land, is set to open in 1Q2025.
Most recently, in November, RWS began constructing its new waterfront lifestyle development as part of its expansion plan. The new waterfront development will feature a waterfront promenade, a four-storey world-class retail and dining podium with entertainment offerings, and two new luxury hotels featuring 700 keys. The two new hotels will complement RWS’s current repertoire of six premier hotels.
Designed by architectural firm Benoy, the development will include an immersive mountain trail. The heart of the new waterfront development will feature a sculpture envisioned in collaboration with architecture firm Heatherwick Studio.
The waterfront development, targeted to open by 2030, is set to redefine luxury and lifestyle for new and returning guests. This transformation in RWS will rejuvenate Singapore’s Greater Southern Waterfront and further strengthen its appeal as a premium lifestyle destination resort for locals and tourists. It is also aligned with Singapore’s Tourism 2040 goal of boosting quality tourism growth.
The waterfront development, built by China Metallurgical Group Corporation (MCC), will incorporate the latest sustainability principles and innovations to attain a BCA Green Mark Platinum certification.
To stay ahead of Singapore and the region’s corporate and economic trends, click here for Latest Section
Speaking at the groundbreaking ceremony, Tan Hee Teck, CEO of RWS, says: “All these are part of RWS’ expansion plans that are worth around $6.8 billion, which has great potential to create interesting new job opportunities for businesses and to have a great economic impact.”
While RWS has big plans for the future, its casino, one of two in Singapore, suffered a recent hiccup. According to the Gambling Regulatory Authority (GRA), an independent evaluation panel on Nov 18 deemed RWS’s tourism performance for the evaluation period from Jan 1, 2021, to Dec 31, 2023, “ unsatisfactory”, with several areas requiring “rectification and substantial improvement.”
Hence, Genting Singapore’s licence to operate its casino in RWS has only been renewed for two years from February 2025 instead of the usual three-year term.
GRA says it will work with various government bodies to “ensure that RWS meets the requirement to develop, maintain and promote its IR as a compelling tourist destination”.
“The evaluation panel of GRA has recommended that the next evaluation be carried out in two years, in 2026,” adds GRA.
On Nov 7, Genting Singapore reported 3QFY2024 earnings ended Sept 30 of $79.4 mil, 63% lower y-o-y, amid a slower recovery of international visitor arrivals to Singapore. Revenue was 19% lower y-o-y at $561.9 million due to a 28% y-o-y drop in gaming revenue.
Lower earnings, downgrades, and lower analyst target prices have caused GENS shares to drop to a two-year low. From the start of the year to Nov 8, shares in GENS have fallen 24.3% to trade at 76 cents. This makes this counter one of the worst-performing component stocks of the Straits Times Index this year.
MBS gets a makeover
Genting Singapore is not the only one spending money on its integrated resort. Las Vegas Sands (LVS) has committed US$1.75 billion ($2.35 billion) to a reinvestment programme and an additional US$8 billion to an expansion plan for MBS.
The reinvestment programme is the largest reinvestment since MBS’s opening in 2010. It has already seen the complete refurbishment of Hotel Towers 1 and 2, as well as new dining offerings and luxury lifestyle amenities for high-value travellers. The refurbishment work now focuses on Hotel Tower 3, Hotel Lobby and Sands SkyPark. It will include a reimagined VIP arrival experience, new premium dining and retail offerings, lobby transformation and a renewed focus on wellness experiences for guests.
On the other hand, the expansion plan was initially budgeted at about US$3.3 billion and encountered some delays since its announcement in April 2019. However, parent company LVS mentioned in its 3QFY2024 ended Sept 30 earnings presentation on Oct 23 that it is set to spend about US$8 billion on the expansion project dubbed “Marina Bay Sands IR2” instead. This includes about US$4.7 billion for design and construction, US$2 billion for land premiums and US$1.3 billion for pre-opening and finance costs. The expansion is expected to be completed in mid-2030.
LVS mentioned that it expects to directly contribute about 25% to 35% of the project cost, while the remaining costs will be covered through project financing.
The expansion will see the addition of a fourth hotel tower with a sky roof. It will include a luxury 570-room all-suite hotel, a 15,000-seat entertainment arena, additional premium meetings, incentives, conferences and exhibitions (MICE) space, new F&B and nightlife offerings, and new premium gaming areas and lifestyle and wellness amenities.
During its 3QFY2024 earnings call, LVS president and COO Patrick Dumont said: “Our goal is to make the tower something very different. It will be the most important gaming and hospitality building in the world. It will be the best hotel in the world. We aim to provide the best service, experience and F&B.”
“Singapore is a desirable and special place with world-class infrastructure and government. We will build a hotel that everyone will desire to stay so rates and gaming capacity should increase,” adds Dumont.
The way Dumont sees it, the new tower will set new standards of hospitality in Singapore. The state-of-the-art arena will help attract the highest-calibre global entertainment events and artists. At the same time, the additional convention and exhibition space will extend the success of Singapore as a leading MICE destination.
“This significant investment in Singapore will help ensure Marina Bay Sands is ideally positioned to grow its economic, employment and visitorship contributions in the years ahead,” he says.
