Thursday, August 14, 2008

China counts on Olympic Games to boost room returns

Wednesday, 13 August 2008. China’s hotel industry is counting on a boost during the Olympic Games, after a nationwide decline in room yield in the first half of this year. Several major markets have experienced occupancy falls as new hotel openings have stretched demand, according to a survey of 528 internationally branded Chinese hotels.

According to the survey by STR Global, with the world watching China for the Olympics this month, expectations are high for a better second half performance.

China’s national occupancy fell 6.9 per cent in the first half of 2008 to 60.8 per cent. Average daily rate increased 2.3 per cent to US$133.31, while there was a 4.8 per cent decline in revenue per
available room.

“The Chinese hotel industry has thus far faced a year of significant challenges ranging from natural disaster to an uncertain global economy,” said James Chappell, managing director of STR Global.
“However, with the 29th Olympiad in Beijing, the Chinese hotel industry will be looking to the vent to provide the profits in 2008.”

In Beijing, new hotel openings and lighter than expected pre-Olympic demand have caused occupancy to drop 10.7 per cent to 61.8 per cent. However, a 7.6 boost in rates has helped offset this.

In Shanghai, occupancy has fallen by 8.5 per cent to 59.1 per cent. To compound this, rates have also fallen slightly, while performance in Hong Kong was flat. Occupancy was down 0.8 per cent at 80.6 per cent – the highest in the survey. -John Newton

China counts on Olympic Games to boost room returns
micebtn, Australia