Hong Kong average room rates surpass pre-Covid period in 2019: CBRE
The recovery in hotel functionality has actually been pushed by the return of global tourists, mostly mainland Chinese tourists, who make up over 79% of all inbound landings over the past year, says CBRE.
HKTB expects a complete recovery of international tourist by the end of 2025, fuelled by an ongoing increase of mainland Chinese visitors.
The Hong Kong Hotels Association (HKHA) disclosed average room occupancy estimates of 93.4% and average room rates of HK$ 1,715 ($295.50), both of which are at or above the levels assessed for the similar holiday season time period in 2019, states a CBRE record on the Hong Kong hotel market update on March 26.
“With a significant margin still existing in between historical and current overnight guest numbers, CBRE is positive that there will be further operational growth in Hong Kong SAR in 2024, pushed by a recovery in occupancy in well-managed properties,” says the statement.
According to CBRE, exclusive capitalists will remain to steer acquisitions in 2024, with a value-add and opportunistic strategy as their primary focus. Co-living, university student room, and serviced home owners are projected to carry on increasing their impact by capitalising on the general lack of such properties in the living field and the demand offered by the Top Talent Pass Scheme (TTPS).
The accommodation market created HK$ 29.2 million in revenue in 2023, on the same level with 2019 numbers. According to the Hong Kong Tourism Board (HKTB), typical day-to-day levels of HK$ 1,444 in January 2024 were 9% more than in January 2019, and overall RevPAR (income per offered bedroom) was 1% higher than in the very same duration in 2018.
Running performance for the deluxe and high end segments in Hong Kong is expected to improve in 2024, with these investments having seen relatively slower price appraisal matched up to different rate 1 markets in the Asia Pacific area.
Incoming arrivals increased to around 34 million, with mainland Chinese travelers accounting for over 79% of all arrivals in 2023. Over 1.46 million tourist arrivings were recorded throughout the Lunar New Year vacations in February 2024, of which Chinese made up 1.25 million (85.6%). The numbers have actually exceeded the degrees logged over the very same period of time in 2018.
While hotel companies have enhanced substantially over the past twelve month, the investment market continues to be challenging. “Assumptions are that borrowing expenses will begin to decrease in mid-2024 in tandem with the Federal Reserve,” mentions the statement. Hence, it is expected to promote investment event. However, CBRE notes that an adverse take and unpredictability over when these rates will begin to change can restrict the probabilities of a solid uptick in venture volume.
