While visitor arrivals to Singapore hit another record high in April this year, some research houses worried that the weak global economic conditions have begun to take a toll on the local hotel industry.

The latest data from the Singapore Tourism Board (STB) show tourist arrivals in April remained high at 1.2 million visitors, which were 9 percent higher year-on-year and a new record. Year-to- date visitor arrivals have hit 4.8 million, representing 33 percent of the STB's higher end target of 13.5 million to 14.5 million for 2012.

The strong visitor numbers, fueled by major MICE (meetings, incentives, conferences, and exhibitions) events like Food and Hotel Asia held in April, have led to strong demand for rooms, and thus room rates have remained on a firm uptrend, with average room rates at 261 Singapore dollars per night in April, also an increase of 9 percent. Hotel occupancies are hovering at a high of 87 percent.

Given the good numbers released by the STB, DBS Group Research is sanguine about the outlook of Singapore hospitality sector, saying that "with the industry approaching the seasonally high tourism season of June to July, we are optimistic that the industry could potentially exceed the projections set by the STB."

Referring to historical visitor arrival patterns, DBS Group believed that second half of the year should be a stronger half for the Singapore hospitality sector. Historical peak seasons of June to July, September, and November to December combined brought in close to 55 percent of total annual visitor arrivals in the past.

However, other research houses are less optimistic about the prospect of the hotel industry in Singapore.

Watching closely at the events unfolding in the euro zone that had impacted the major economies around the world, Maybank Kim Eng Research said "we remain wary of macroeconomic headwinds and its drag on business and leisure travelers. A deeper-than-expected global slowdown might lead to a sudden drop in tourist numbers, which could adversely impact the sector's performance."

"We also think the 2,586 and 3,909 hotel rooms scheduled to be completed in 2012 and 2013 respectively will put pressure on average room rates."

OCBC Investment Research was also quick to point out that while figures released by the STB show that visitor arrivals grew 9 percent, it was much less than the 14.6 percent growth for first quarter this year.

OCBC Investment said it learned from hotel rooms wholesaler that occupancy growth has slowed in the past few months, with May estimated to have about two-thirds of what was seen for each month between January and April, and June so far has been quite slow too.

As an indication of the less upbeat conditions, local hotels are more willing to engage wholesalers and use discounts. Even some 5-star hotels have been cutting rates by 50 percent at the last minute.

As hotel figures for July last year were very strong with the highest occupancy month for all four hotel tiers, OCBC Investment said such performance last year could present a reasonable hurdle for this July to outdo given the recent slowdown trend in the sector. (1 U.S. dollar equals to 1.27 Singapore dollars)