By Desmond Ng

THE inaugural Formula One weekend came, and zoomed past just as quickly.

In all, it had been estimated that the race would pump some $100 million into the Singapore economy.

The Government said in 2007 that the spillover benefits from the F1 to the economy would be 'very large', in terms of increased consumer or tourism spending.

But with the race behind us, the issue now is how the benefits have trickled down the line to businessmen and others.

The Singapore Tourism Board (STB) said that the $100m in question is still being analysed.

But some of the expected beneficiaries of this Grand Prix - mainly retailers and hoteliers - have their own take.

Retailers and restaurants in the Marina Bay area had complained about poor takings since shoppers shunned the malls because of the road closures.

The retail sales index for last September - when the F1 was held - showed a drop of 0.8 per cent (excluding motor vehicle sales), said the Singapore Retailers Association (SRA).

SRA's executive director Lau Chuen Wei said: 'This is evidence that F1 did not bring with it the increase in business for the retail sector.

'Although there is no hard data on this, anecdotal evidence (from retailers) indicates that the trackside malls in particular, suffered losses in business tremendously.'

But, she added, retailers located along Orchard Road would have benefited because consumers who stayed away from the Marina area (local shoppers) 're-located' to other parts of the island and to Orchard Road (particularly among tourists).

As for the hotels, several trackside hotels reported full houses.

While non-trackside ones lamented that business could have been better.

Trackside hotels like Ritz-Carlton Millenia, Swissotel The Stamford and Fairmont Singapore were fully booked during the F1 weekend.

Non-trackside hotel Royal Plaza On Scotts was fully occupied during the F1 weekend but occupancy for the week was around 86 per cent.

Said the hotel's spokesman: 'The F1 event didn't meet our expectations for the week itself. Our room rate was below our forecast, due to lower demand. We expected people to come in before the race weekend to sightsee but that didn't happen.'

The hotel said that ordinarily, their occupancy for that week would be about 97 per cent, without the F1 event.

But with the F1 in town, many business travellers stayed away to avoid the crunch.

Hotel Rendezvous said their occupancy was at 70 per cent during that period.

Said the hotel's general manager, Mr Kellvin Ong: 'We could have done better. This year, we will learn our lesson and fine tune our strategies to capitalise on this event.

'We have managed to achieve a fairly good average room rate but we are hoping to do better in terms of occupancy.'

The Meritus Mandarin Singapore occupancy rate was around 80 per cent over the F1 period.

The hotel said some of their regular customers avoided this period due to the extra surcharge.

Said Ms Lim Ee Jin, assistant vice-president (Marcoms and PR) of Meritus Mandarin): 'The spillover effects were slightly below our expectations as inflation and the economic slowdown had an inevitable dampening effect on consumer spending, with more people cutting down on travel.'

Adding that Singapore's F1 has yet to gain anything like Monaco's international presence, Ms Lim added: 'With time and more international publicity, we believe that the interest in F1 will mature in Singapore.'

Trackside hotels had to pay 30 per cent tax on their room revenue for the five nights surrounding the race and non-trackside hotels had to fork out 20 per cent.

It was reported that about $15 million to $20 million will be raised from this, according to a Straits Times report in 2007.

The Singapore Hotel Association (SHA) said that the F1 is a great success for Singapore but declined to give numbers.

Said SHA president Madam Kay Kuok: 'The worldwide attention given to the event is in turn good for the hospitality industry in Singapore especially as the city will be hosting the event for another four consecutive years.'

According to STB estimates, hotels earned $186m in room revenue last September, up 26.3 per cent from 2007, The Business Times reported in October.

But the average hotel occupancy rate was 73 per cent in September, down 11.6 per cent from a year back.

Visitor arrivals also fell 4.1 per cent that month to 739,000 compared to 771,000 in 2007.

Standard Chartered Bank economist Alvin Liew said a combination of factors could have dampened the F1 spillover.

This included the financial crisis and teething problems with the F1 such as the traffic diversions and road shut-downs.

He said: 'We've to keep in mind that 2008 wasn't a great year. The economic outlook was uncertain and the financial crisis was in full swing then.

'We need to take a longer term basis when the event becomes more rooted and the global economy is on the upside.'

He added that it was too early to judge the results of the F1.

This article was first published in The New Paper on January 13, 2009.