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

The lodging market generated HK$ 29.2 million in profits in 2023, on par with 2019 numbers. According to the Hong Kong Tourism Board (HKTB), normal day-to-day rates of HK$ 1,444 in January 2024 were 9% higher than in January 2019, and overall RevPAR (revenue per offered bedroom) was 1% more than in the very same period in 2018.

HKTB anticipates a complete recovery of worldwide tourism by the end of 2025, fuelled by a continuous increase of mainland Chinese visitors.

While hotel companies have actually enhanced significantly over the past twelve month, the financial investment market remains tough. “Presumptions are that borrowing costs will begin to decrease in mid-2024 in tandem with the Federal Reserve,” mentions the statement. Therefore, it is assumed to advertise financial investment event. However, CBRE notes that an unfavorable hold and uncertainty over when these rates are going to begin to change might restrict the possibilities of a strong uptick in investment number.

Inbound arrivals raised to around 34 million, with mainland Chinese guests representing over 79% of all arrivals in 2023. Over 1.46 million traveler arrivings were reported throughout the Lunar New Year holidays in February 2024, of which Chinese comprised 1.25 million (85.6%). The numbers have exceeded the levels documented over the exact same period in 2018.

The upturn in hotel operation has been pushed by the statement of international travellers, generally mainland Chinese tourists, that account for over 79% of all inbound landings over the past twelve month, says CBRE.

Running efficiency for the deluxe and high end sectors in Hong Kong is assumed to improve in 2024, with these investments having observed fairly slower price appraisal compared to other rate 1 industry in the Asia Pacific region.

The Hong Kong Hotels Association (HKHA) disclosed standard room occupancy levels of 93.4% and standard room rates of HK$ 1,715 ($295.50), each of which are with or above the degrees assessed for the similar holiday season time frame in 2019, says a CBRE record on the Hong Kong hotel market news on March 26.

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“With a considerable margin still existing in between historical and latest over night visitor numbers, CBRE is confident that there will certainly be more operational development in Hong Kong SAR in 2024, propelled by a recovery in tenancy in well-managed assets,” says the information.

According to CBRE, exclusive capitalists are going to remain to generate purchases in 2024, with a value-add and opportunistic approach as their primary concentration. Co-living, college student room, and serviced home operators are projected to carry on broadening their footprint by capitalising on the overall lack of such estates in the living market and the interest offered by the Top Talent Pass Scheme (TTPS).

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