Hong Kong average room rates surpass pre-Covid period in 2019: CBRE
The recovery in hotel functionality has actually been steered by the return of worldwide travellers, primarily mainland Chinese vacationers, who represent over 79% of all incoming arrivals over the past one year, says CBRE.
Running performance for the luxury and upscale segments in Hong Kong is expected to enhance in 2024, with these properties having actually seen reasonably slower price appraisal contrasted to various tier 1 markets in the Asia Pacific location.
“With a considerable margin still existing in between historical and latest over night visitor numbers, CBRE is optimistic that there will be further operational development in Hong Kong SAR in 2024, propelled by a rehabilitation in tenancy in well-managed assets,” states the report.
Inbound arrivals boosted to around 34 million, with mainland Chinese travelers accounting for over 79% of all arrivals in 2023. Over 1.46 million tourist arrivals were recorded throughout the Lunar New Year vacations in February 2024, of which Chinese made up 1.25 million (85.6%). The numbers have exceeded the degrees recorded over the very same period in 2018.
According to CBRE, private financiers are going to continue to generate procurements in 2024, with a value-add and opportunistic approach as their primary emphasis. Co-living, student accommodation, and serviced house owners are projected to go on increasing their presence by capitalising on the total scarcity of such estates in the living sector and the interest provided by the Top Talent Pass Scheme (TTPS).
The Arcady @ Boon Keng floor plan
HKTB expects a complete resurrection of worldwide travel by the end of 2025, sustained by a continued influx of mainland Chinese tourists.
The Hong Kong Hotels Association (HKHA) reported average room tenancy rates of 93.4% and regular room prices of HK$ 1,715 ($295.50), both of which are at or above the levels measured for the same holiday period in 2019, states a CBRE report on the Hong Kong hotel market update on March 26.
While hotel and resort business have improved considerably over the past twelve month, the financial investment market stays tough. “Assumptions are that credit expenses will start to decline in mid-2024 in conjunction with the Federal Reserve,” indicates the report. Thus, it is anticipated to market investment event. Nonetheless, CBRE notes that an adverse carry and unpredictability over when these rates will begin to change might restrain the probabilities of a solid uptick in investment quantity.
The hotel industry created HK$ 29.2 million in profits in 2023, on par with 2019 rates. According to the Hong Kong Tourism Board (HKTB), average everyday levels of HK$ 1,444 in January 2024 were 9% higher than in January 2019, and overall RevPAR (revenue per available room) was 1% more than in the same duration in 2018.