Hong Kong average room rates surpass pre-Covid period in 2019: CBRE

The Hong Kong Hotels Association (HKHA) documented standard room occupancy rates of 93.4% and average room rates of HK$ 1,715 ($295.50), each of that are at or above the amounts measured for the very same holiday season time frame in 2019, states a CBRE report on the Hong Kong hotel market news on March 26.

“With a considerable margin still standing between historical and existing overnight viewers numbers, CBRE is confident that there will be further functional development in Hong Kong SAR in 2024, driven by a recuperation in occupancy in well-managed assets,” states the statement.

Inbound arrivals boosted to about 34 million, with mainland Chinese visitors making up over 79% of all arrivals in 2023. Over 1.46 million traveler landings were reported throughout the Lunar New Year holidays in February 2024, of which Chinese made up 1.25 million (85.6%). The numbers have exceeded the degrees logged over the same period of time in 2018.

The upturn in hotels and resort performance has been steered by the statement of international travellers, mostly mainland Chinese visitors, that represent over 79% of all incoming arrivings over the past year, states CBRE.

According to CBRE, exclusive investors will continue to generate acquisitions in 2024, with a value-add and opportunistic method as their main focus. Co-living, university student lodging, and serviced residence owners are projected to go on increasing their footprint by capitalising on the total shortage of such estates in the living market and the need offered by the Top Talent Pass Scheme (TTPS).

The accommodation sector created HK$ 29.2 million in income in 2023, on the same level with 2019 rates. According to the Hong Kong Tourism Board (HKTB), typical day-to-day levels of HK$ 1,444 in January 2024 were 9% greater than in January 2019, and overall RevPAR (profits per available bedroom) was 1% greater than in the exact same duration in 2018.

Midtown Bay condominium

While hotels and resort companies have actually improved significantly over the past 12 months, the investment market stays challenging. “Presumptions are that loaning costs will begin to decline in mid-2024 in conjunction with the Federal Reserve,” mentions the report. Thus, it is assumed to market investment activity. Nonetheless, CBRE notes that an adverse hold and unpredictability over when these rates are going to begin to change could restrain the probabilities of a solid uptick in venture number.

HKTB anticipates a full improvement of global tourism by the end of 2025, fuelled by a continued arrival of mainland Chinese visitors.

Running performance for the high-end and upscale segments in Hong Kong is expected to improve in 2024, with these investments having actually seen reasonably slower rate appraisal contrasted to other rate 1 markets in the Asia Pacific location.

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