Hotel rates in Singapore fell 2.5% year-on-year in June, marking the fifth consecutive month they have declined.

According to latest preliminary data from STR, last month’s drop took Singapore’s average daily rate (ADR) to SG$258.03 (approx. US$186) – the lowest June level in the city since 2010. STR’s analysts attributed the declining ADR to rising hotel supply and economic challenges in Singapore.

But the decline in June was set against an otherwise positive backdrop; demand for rooms in the city increased 6.5% – significantly higher than the 2.3% expansion of supply. This imbalance caused citywide occupancy to increase 4.1% to 78.9%, and revenue per available room (revPAR) to grow 1.5% to SG$203.62.

The strong demand was likely boosted by the changing dates of Ramadan, which encouraged stronger tourism arrivals from Muslim source markets like Indonesia.

And while the ADR and revPAR levels remain low in Singaporean terms, they are still considerably higher than the global average.