Skift Travel News Blog

Yanolja said this week it expected that a post-pandemic rebound in international travel will continue to boost its twin businesses of online travel sales via a superapp and software sales to hotels and other travel companies. The South Korea-based startup has made progress on both ambitions since 2011, when it received a $1.7 billion investment from the Softbank Vision Fund in a transaction that valued Yanolja at the time at approximately US$9 billion.

The privately held travel company in South Korea reported this week some of its financial results for the third quarter, saying it had experienced “high growth rates in all business areas.”

Yanolja recorded consolidated sales of approximately $147 million (192.2 billion Korean won) in the quarter, a 112 percent jump from the same period a year.

Unlike many travel startups, the company is profitable. Yanolja reported an adjusted earnings before interest, taxes, depreciation, and amortization, of about $8.1 million (10.6 billion Korean won).

Roughly half of the company’s growth has been partly driven by its software business, which had a 32 percent year-over-year increase to $71 million in sales in the quarter. For more context on the travel software sales, see Skift’s story Decoding Yanolja Cloud and Its Hotel Software Strategy.

The mid-sized company said it has been staffing up for roles in product management, software engineering, and user experience design, and has cash on hand to make acquisitions.

Jongyoon Kim, CEO of Yanolja, will discuss the company’s overall strategy and business performance at Skift Global Forum East in Dubai on December 14. Kim joined Yanolja in 2015 as chief strategy officer and in 2021, was elevated to CEO. He has previously worked at McKinsey & Company, Google, and 3M. Many industry analysts wonder if Kim will be able to guide the ambitious tartup to a successful initial public offering someday, and if so, when.

Investment in the hotel sector in Asia Pacific continued to recover as investment volumes totaled $6.8 billion in the first six months of 2022, according to real estate brokerage firm JLL’s report.

Capital deployment into the region’s hotels sector showed a return to pre-pandemic levels, registering a 12 percent increase compared to 2019.

Countries in the Asia-Pacific region are expected to experience a fast pace of recovery in the second half of 2022, Skift Research noted recently in its Asia Pacific Accommodation Sector Market Estimates 2022.

In terms of investment volume Japan received the maximum capital —  $1.8 billion, followed by Korea’s $1.7 billion, and Greater China, including Hong Kong ($1.6 billion).

A strong domestic and international tourism demand and the recent devaluation of the Japanese Yen would drive investors to acquire hotel assets in Japan, JLL noted.

JLL also expected further price reductions of hotel assets and forecasts China’s hotel transaction volume to total approximately $2 billion in 2022.

Strong recovery was witnessed in countries like Singapore ($899.7 million), Maldives ($205.5 million), and Indonesia ($159.6 million).

The activity was more subdued in Australia ($145.5 million) and Thailand ($37.7 million), however, JLL noted that these countries would witness greater investment in the second half as numerous marque deals would be closing.

More hotels are entering the Thai market as sellers are under pressure to sell, noted JLL and forecast that transaction volumes would reach close to $300 million this year.

While the 75 transactions in the first half of 2022, were down 33 percent compared to the first half of 2019, the 19,822 rooms transacted during the first half of 2022 was 30 percent higher compared to the first half of 2021 and 9.4 percent compared to 2019.

“The increase in deal activity was influenced by a spike in portfolio transactions as institutional investors sitting on dry powder seek to deploy their capital more efficiently,” the report noted.

However, according to JLL, ongoing momentum will likely be challenged by growing macroeconomic and geopolitical headwinds in the second half of 2022.

“We remain steadfast in our conviction that total Asia Pacific hotel investment volume will cross the $10 billion mark despite the scarcity of assets coupled with macro and geopolitical headwinds that will continue to influence capital activity,” said Mike Batchelor, CEO, Asia Pacific, JLL Hotels and Hospitality Group.