JEJU, Jan. 16 (Korea Bizwire) — South Korea’s southern resort island Jeju is facing an oversupply of hotel rooms, a bank report said Wednesday, calling for measures to ensure stable growth of the island’s lodging industry.
The report issued by the Bank of Korea’s Jeju branch said that hotels and other accommodations on Jeju Island have 71,822 guest rooms, while the number of rooms needed to accommodate the current number of tourists is estimated at 46,000.
The oversupply of hotel rooms is projected to reach about 26,000 for now, the report noted. The bank made the estimation based on the daily average of 176,000 tourists staying on Jeju.
Jeju’s lodging industry recorded annual average growth of 13.7 percent in terms of sales from 2006 to 2016. In the period, industry sales increased four times and the number of employees and businesses nearly doubled.
These days, however, the island’s lodging industry suffers growing difficulties due to the glut of hotel rooms and reduction in the number of tourists, the report said.
As of the end of 2018, Jeju Island had 5,182 hotels and other accommodations that operate 71,822 guest rooms. Hotels and condos numbered 416, offering 32,175 rooms.
The number of rooms at accommodation residences, including condo hotels and serviced residences, has increased rapidly since 2014 to reach 5,633 last month, the report said.
“Jeju’s lodging industry is expected to continue to slump for the time being due to slowing increase in the number of domestic tourists, the permission of shared accommodation business and other internal and external factors,” said the report.
“Long-term policy measures are needed to control the number of hotel rooms because the construction of additional hotels and condos is planned across the island,” it said.