While tourism in Indonesia is often defined by Bali, the country is now seeing a period where growth is defined by other markets and more specifically by the growth of luxury hotels in those markets.
Speaking on the latest episodes of the CoStar News Hotels podcast, STR's regional vice president in the Asia Pacific region Jesper Palmqvist said hotel developers are seeing opportunities to expand luxury offerings in Indonesia.
"You can see some of the new luxury happening in Jakarta, as well," he said. "And rate growth has given them much higher profits, which" makes owners happy.
Palmqvist said that high-end hotel rate growth isn't likely to continue forever, and it could be in for some moderation going forward. But it's likely the growth mindset will continue in Indonesia.
"The Indonesian spirit in terms of entrepreneurship and development is quite something," he said.
In other news in the region, Palmqvist noted that hotel demand is settling into a new normal across Japan. While that country's resiliency in light of losing Chinese travelers has been impressive, some markets have fared better than others in a remix of feeder markets.
Tokyo — a favorite of Western travelers — is enjoying record average daily rates while western Japanese markets like Osaka are seeing a performance dip, Palmqvist said. It's also led to difference in length of stay and hotel segment performance.
"The Chinese tend to have a shorter length of stay because it's a shorter trip [to Japan] ... They would have a shorter flight to come over and stay more in the midscale places," he said, noting American travelers favor high-end properties.
For more from STR's Jesper Palmqvist, listen to the podcast embedded above.