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THE INDONESIAN hotel sector still faces a steep road until the end of 2025. The hotel room occupancy rate (TPK) has not shown a solid recovery, even though tourism activity is slowly moving up.
Data from the Central Statistics Agency (BPS) notes that the ROR for hotels in Indonesia in November 2025 will be at the level of 39.97%. This figure did indeed increase slightly by 0.44 points compared to October 2025, but on an annual basis it actually decreased by 2.64 points compared to November 2024. This condition reflects that the recovery of the hotel sector is progressing more slowly than tourism travel.
According to BPS Deputy for Distribution and Services Statistics, Pudji Ismartini, explained that star hotels are still the main support for occupancy levels. In November 2025, the ROR for star hotels will reach 53.89%, an increase of 1.05 points monthly. However, when compared with the same period last year, this figure fell by 1.07 points.
“This shows that even though there is short-term improvement, the pressure on the hotel sector on an annual basis is still felt,” said Pudji recently.
Regionally, South Papua recorded the highest occupancy rate with a TPK reaching 63.31%. The next positions are occupied by East Kalimantan and DKI Jakarta, which respectively recorded a TPK of 63.01% and 62.03%.
On the other hand, the Bangka Belitung Islands, Aceh and Papua Mountains are the areas with the lowest hotel occupancy rates.
Government Spending Falls, Hotels Lose Support
From a market perspective, pressure on the hotel industry throughout 2025 cannot be separated from weakening demand from the government sector.
According to the Head of Research at Colliers Indonesia, Ferry Salanto, the decline in government activity has had a significant impact on hotel performance, especially in big cities which have been dependent on meetings, conferences and official travel.
“Demand for hotels from the government segment fell by 50%. The increase from the private segment has not been able to cover the gap previously filled by government spending,” said Ferry in the Colliers Virtual Media Briefing for the Fourth Quarter of 2025 recently.
Even though occupancy is depressed in the range of 5-10%, Ferry assesses that room rates still have the potential to increase slightly. This is influenced by the strategy of hotel managers who maintain prices to cover increases in operational costs, including energy and labor.
Meanwhile, the General Chair of PHRI, Hariyadi Sukamdani, previously assessed that the government’s budget efficiency policy throughout 2025 was one of the main factors holding back the recovery of the hotel sector, especially in MICE (meeting, incentive, convention, exhibition) based destinations.
In the midst of this pressure, tourist movements actually show more promising signals. BPS noted that the number of foreign tourist visits in November 2025 will reach 1.2 million visits, growing 9.79% annually.
Cumulatively, from January to November 2025, foreign tourist visits reached 13.98 million visits, an increase of 10.44% compared to the same period the previous year.
Tourists from Malaysia still dominate visits to Indonesia with 207.04 thousand visits or 17.27 percent of the total foreign tourists. The next position was filled by Australian tourists with 135.22 thousand visits, Singapore with 126.25 thousand visits, and China with 105.51 thousand visits.
Not only foreign tourists, domestic tourists also recorded significant growth. In November 2025, foreign tourists’ trips reached 96.45 million trips, an increase of 19.64 percent compared to the previous year.
Cumulatively, total foreign tourist trips from January to November 2025 reached 1.09 billion trips, an increase of almost 19% compared to 2024. Java Island is still the main destination for domestic tourist trips. In November 2025, as many as 62.21 million foreign tourists’ trips or 64.51% of the total national trips were recorded to this region.
The Ministry of Tourism previously stated that increasing tourist mobility, both domestic and foreign, is expected to be a catalyst for the recovery of the hotel industry in 2026, especially if supported by economic stability and policies that encourage MICE activities and international scale events.
With this trend, industry players hope that 2026 can be a turning point, where the surge in tourists is able to offset sluggish demand from the government segment and bring the hotel sector back to a more sustainable recovery path. [sources/photo special]
