Hong Kong average room rates surpass pre-Covid period in 2019: CBRE
The Hong Kong Hotels Association (HKHA) documented average room occupancy rates of 93.4% and standard room prices of HK$ 1,715 ($295.50), both of that are at or over the amounts assessed for the similar holiday time frame in 2019, says a CBRE record on the Hong Kong hotel market update on March 26.
Inbound arrivals increased to around 34 million, with mainland Chinese travelers making up over 79% of all arrivals in 2023. Over 1.46 million tourist landings were recorded during the Lunar New Year holidays in February 2024, of which Chinese made up 1.25 million (85.6%). The figures have actually gone beyond the levels recorded over the exact same time frame in 2018.
Running efficiency for the high-end and upscale segments in Hong Kong is anticipated to boost in 2024, with these investments having actually observed fairly slower price appreciation contrasted to other tier 1 markets in the Asia Pacific location.
While hotels and resort operations have boosted considerably over the past one year, the financial investment market remains tough. “Assumptions are that borrowing expenses will certainly start to decline in mid-2024 in conjunction with the Federal Reserve,” indicates the report. Thus, it is anticipated to promote financial investment event. Nevertheless, CBRE notes that an adverse hold and unpredictability over when these prices will start to shift could restrain the probabilities of a strong uptick in venture volume.
The recuperation in hotel operation has actually been pushed by the statement of worldwide visitors, mainly mainland Chinese visitors, that make up over 79% of all incoming arrivals over the past year, says CBRE.
The accommodation sector produced HK$ 29.2 million in income in 2023, on par with 2019 figures. According to the Hong Kong Tourism Board (HKTB), average day-to-day rates of HK$ 1,444 in January 2024 were 9% greater than in January 2019, and overall RevPAR (profits per offered bedroom) was 1% greater than in the very same duration in 2018.
HKTB anticipates a complete improvement of global tourism by the end of 2025, sustained by a continued increase of mainland Chinese travellers.
“With a significant margin still standing between historical and latest overnight visitor numbers, CBRE is confident that there will be additional functional development in Hong Kong SAR in 2024, driven by a rehabilitation in occupancy in well-managed assets,” says the statement.
According to CBRE, exclusive financiers are going to remain to steer acquisitions in 2024, with a value-add and opportunistic method as their key concentration. Co-living, student lodging, and serviced residence operators are projected to carry on expanding their impact by capitalising on the overall scarcity of such buildings in the living sector and the demand offered by the Top Talent Pass Scheme (TTPS).
