Hong Kong average room rates surpass pre-Covid period in 2019: CBRE
Operating efficiency for the deluxe and high end sections in Hong Kong is anticipated to enhance in 2024, with these properties having actually observed relatively slower cost appreciation contrasted to other tier 1 markets in the Asia Pacific region.
The lodging sector created HK$ 29.2 million in profits in 2023, on par with 2019 numbers. According to the Hong Kong Tourism Board (HKTB), typical everyday rates of HK$ 1,444 in January 2024 were 9% higher than in January 2019, and overall RevPAR (earnings per readily available bedroom) was 1% greater than in the same period in 2018.
“With a substantial margin still existing between historical and latest overnight visitor numbers, CBRE is optimistic that there will be additional functional development in Hong Kong SAR in 2024, pushed by a recovery in occupancy in well-managed investments,” states the report.
The upturn in hotels and resort functionality has been pushed by the statement of global travellers, generally mainland Chinese visitors, that represent over 79% of all inbound arrivals over the past one year, states CBRE.
According to CBRE, exclusive financiers will remain to generate procurements in 2024, with a value-add and opportunistic strategy as their key focus. Co-living, college student accommodation, and serviced residence owners are projected to go on expanding their footprint by capitalising on the total lack of such estates in the living field and the need offered by the Top Talent Pass Scheme (TTPS).
While hotels and resort companies have improved significantly over the past one year, the investment market stays tough. “Presumptions are that credit prices will start to decline in mid-2024 in conjunction with the Federal Reserve,” notes the statement. For this reason, it is expected to market financial investment activity. However, CBRE notes that an unfavorable hold and uncertainty over when these rates are going to start to move could restrain the probabilities of a strong uptick in venture volume.
The Hong Kong Hotels Association (HKHA) documented standard room tenancy rates of 93.4% and regular room prices of HK$ 1,715 ($295.50), the two of that are at or above the amounts assessed for the similar holiday period in 2019, states a CBRE record on the Hong Kong hotel market news on March 26.
Incoming arrivals enhanced to about 34 million, with mainland Chinese travelers representing over 79% of all arrivals in 2023. Over 1.46 million traveler arrivings were filed during the Lunar New Year holidays in February 2024, of which Chinese made up 1.25 million (85.6%). The numbers have actually gone beyond the levels recorded over the same time frame in 2018.
HKTB anticipates a complete recuperation of global travel by the end of 2025, sustained by a continued arrival of mainland Chinese tourists.
