Tough times for HK hotels
Tough times are plaguing Hong Kong?s hotels, as even upscale Hongkong and Shanghai Hotels (0045), which operates The Peninsula Hong Kong, saw its average room rate slump 15 percent in the second quarter to a four-year low, The Standard reported.
The average room rate at the Peninsula Hong Kong fell to HK$4,436 from HK$5,242 a year ago, the hotel operator said yesterday.
Its occupancy rate slid one percentage point to 69 percent, the lowest since the third quarter of 2013. Revenue per room dropped 16 percent to HK$3,051.
Chief executive Clement Kwok King-man said tourists around the world are attracted by the weak yen, causing Hong Kong to have fewer Japanese and mainland visitors.
Since peaking in 2013, local hotel rates have slumped to HK$560 and HK$780 for a three- or four-star hotel room.
In 2013, tourists had to pay up to HK$2,000 for a room in a three-star hotel amid limited supply.
Sixty-seven more hotels have been built in the SAR since 2010, taking the total number of hotel rooms to 72,700, up 20 percent.
In the first six months of this year, the occupancy rate of Hong Kong hotels has dropped by an average of five percent while room prices per day have fallen by an average of HK$127 from a year earlier, according to the Hong Kong Tourism Board.
The board said there were more than 12.5 million arrivals in the first half, down 3.8 percent from the same period last year.
?Hotels targeting European and American tourists also suffered because economies and the investment market in these places are not performing well,? said Michael Li Hon-shing, executive director of the Federation of Hong Kong Hotel Owners.
Also, a weaker yuan has put off mainlanders from travelling overseas.
The average room rate at Shangri-La Asia (0069) fell 1.2 percent to US$327 (HK$2,535.60) last year.
Dorsett Hospitality International (2266), which runs four-star hotels, suffered a 9.13 percent drop in its average room rate, while Langham Hospitality Investments (1270) incurred a 6.1 percent drop in the first half.
The Hongkong and Shanghai Hotels? underlying net profit fell 10 percent to HK$265 million.
Interim net profit was up six percent to HK$477 million after taking into account a property revaluation gain