Hong Kong average room rates surpass pre-Covid period in 2019: CBRE
The Hong Kong Hotels Association (HKHA) reported standard room tenancy figures of 93.4% and regular room prices of HK$ 1,715 ($295.50), both of which are at or over the amounts assessed for the similar holiday season time period in 2019, states a CBRE report on the Hong Kong hotel market update on March 26.
The lodging market produced HK$ 29.2 million in earnings in 2023, on par with 2019 rates. According to the Hong Kong Tourism Board (HKTB), average daily rates of HK$ 1,444 in January 2024 were 9% higher than in January 2019, and overall RevPAR (income per available bedroom) was 1% higher than in the same period in 2018.
Operating performance for the luxury and high end sections in Hong Kong is expected to boost in 2024, with these investments having actually observed fairly slower rate appraisal contrasted to other tier 1 industry in the Asia Pacific area.
HKTB anticipates a full resurrection of international tourist by the end of 2025, fuelled by a continued arrival of mainland Chinese visitors.
According to CBRE, exclusive capitalists are going to continue to generate purchases in 2024, with a value-add and opportunistic method as their main emphasis. Co-living, university student accommodation, and serviced house operators are expected to carry on increasing their impact by capitalising on the general shortage of such real properties in the living industry and the need provided by the Top Talent Pass Scheme (TTPS).
Inbound arrivals raised to approximately 34 million, with mainland Chinese guests accounting for over 79% of all arrivals in 2023. Over 1.46 million traveler landings were reported during the Lunar New Year vacations in February 2024, of which Chinese composed 1.25 million (85.6%). The numbers have actually surpassed the levels documented over the exact same period in 2018.
“With a significant margin still existing between historical and latest overnight visitor numbers, CBRE is positive that there will be more operational growth in Hong Kong SAR in 2024, pushed by a recovery in occupancy in well-managed properties,” states the information.
The recovery in hotels and resort operation has actually been steered by the return of global travellers, generally mainland Chinese visitors, who represent over 79% of all incoming landings over the past 12 months, claims CBRE.
While hotel business have boosted considerably over the past 12 months, the investment market continues to be challenging. “Expectations are that borrowing costs will certainly begin to decline in mid-2024 in tandem with the Federal Reserve,” indicates the statement. Therefore, it is expected to promote investment activity. Nonetheless, CBRE notes that a negative carry and unpredictability over when these prices will start to shift can restrain the chances of a solid uptick in investment quantity.