Hong Kong average room rates surpass pre-Covid period in 2019: CBRE
The accommodation market produced HK$ 29.2 million in profits in 2023, on the same level with 2019 figures. According to the Hong Kong Tourism Board (HKTB), normal daily rates of HK$ 1,444 in January 2024 were 9% more than in January 2019, and overall RevPAR (earnings per available room) was 1% greater than in the same period in 2018.
HKTB expects a full improvement of global tourist by the end of 2025, sustained by a continuous arrival of mainland Chinese travellers.
Incoming arrivals boosted to around 34 million, with mainland Chinese guests accounting for over 79% of all arrivals in 2023. Over 1.46 million vacationer landings were filed during the Lunar New Year vacations in February 2024, of which Chinese comprised 1.25 million (85.6%). The figures have actually gone beyond the degrees logged over the very same period in 2018.
While hotel business have boosted considerably over the past twelve month, the financial investment market continues to be tough. “Expectations are that borrowing costs will start to decrease in mid-2024 in conjunction with the Federal Reserve,” notes the statement. Hence, it is anticipated to advertise investment activity. However, CBRE notes that an unfavorable take and unpredictability over when these rates are going to begin to move can restrain the possibilities of a solid uptick in venture volume.
The recuperation in hotels and resort functionality has been driven by the return of international travellers, mainly mainland Chinese tourists, that account for over 79% of all inbound arrivings over the past one year, states CBRE.
According to CBRE, private investors will remain to steer acquisitions in 2024, with a value-add and opportunistic approach as their main concentration. Co-living, college student accommodation, and serviced house operators are projected to go on expanding their presence by capitalising on the total shortage of such buildings in the living market and the demand provided by the Top Talent Pass Scheme (TTPS).
“With a significant margin still existing in between historical and current over night visitor numbers, CBRE is positive that there will certainly be additional functional growth in Hong Kong SAR in 2024, driven by a rehabilitation in occupancy in well-managed assets,” states the information.
The Hong Kong Hotels Association (HKHA) documented average room tenancy levels of 93.4% and regular room rates of HK$ 1,715 ($295.50), the two of that are in or over the amounts assessed for the same holiday season time frame in 2019, states a CBRE record on the Hong Kong hotel market news on March 26.
Running efficiency for the high-end and upscale sectors in Hong Kong is assumed to improve in 2024, with these assets having observed relatively slower price appraisal contrasted to other tier 1 industry in the Asia Pacific area.
