Peninsula HK feels the strain
The Hong Kong and Shanghai Hotels, operator of the landmark Peninsula Hotel Group, failed to improve its performance in the first quarter as local business stayed sluggish.
The luxury hotel operator said revPAR in Hong Kong declined 7 percent in the first three months to HK$3,568 from a year earlier, The Standard reported.
Average room rate for The Peninsula Hong Kong slipped 2 percent year-on-year to HK$5,017 in the first quarter. Despite the lower room price, occupancy at the historic property declined 4 percentage points to 71 percent.
“The first-quarter results were generally in line with our expectations and reflected the soft market in Hong Kong, as well as the seasonal nature of the hotel industry,” said chief executive Clement Kwok King-man.
He added that for the group’s overall leasing business, shopping arcades occupancy rate slipped 2 percentage points to 93 percent during the January-March period.
Average monthly yield per available square foot slipped 7 percent to HK$188 in the first quarter.
The group warned that the outlook for the local market in terms of tourism, high-end residential lettings and retail rental income was uncertain.
But revenue per available room for its hotels in other Asian countries jumped 10 percent from a year earlier to HK$1,631 despite the ongoing renovation of the Peninsula Beijing.
First-quarter average room rate rose 12 percent to HK$2,444, while room occupancy rate dipped one percentage point to 67 percent.
The Peninsula Bangkok saw its occupancy levels improve amid a more stable political environment in Thailand. The Peninsula Tokyo implemented a rate growth strategy and reported strong average return.
The company saw its net profit decline by 12.7 percent last year, the worst since the global financial crisis. The average room rate for The Peninsula Hong Kong in 2015 also hit a five-year low.