Sharon Desker Shaw, Hong Kong (2009-03-20)
HONG Kong hotel room rates continued their “sharp declines” in the first two months of the year, with tour operators warning that further falls were in store for what is traditionally a high season in the second quarter.
In its hotel survey update, international corporate travel services company HRG reported that a two per cent decline in January and Febuary's 16 per cent slide averaged out to a month-on-month drop of nine per cent over the previous year.
January's rate slide came despite an 11 per cent increase in overall arrivals to the city, which - as a leading financial centre in Asia - has been pummeled by the global financial meltdown.
Hong Kong's January average rate came in at HK$2,341 (US$302) and February's at HK$2,197.
One of Hong Kong's major inbound operators warned: “Hotels are no longer treating April as a traditional peak season, selling at rates they usually use for the shoulder season. We are now seeing five-stars competing with four-stars and, in some cases, three-star rates.”
Rates available for Hong Kong's premier sporting event, the Rugby Seven's next weekend, are another indicator of the market's continued deterioration, say operators.
“In the past you had to pay premium prices, with four-star hotels charging about HK$2,000 but five star hotels are now asking this price, pushing four-stars to about HK$1,000.”
Despite two months of rate declines, HRG's survey still placed Hong Kong eighth in a global ranking of cities with the highest average room rates. The only other Asia market to pip Hong Kong in this ranking was Delhi, despite an average 21 per cent fall in rates for the first two months.
The 10th to 12th positions in the rankings were filled by Mumbai, which reported the largest average rate drop at 26 per cent for the first two months, Bengaluru (one per cent) and Tokyo (-14 per cent) respectively.