‘Downward Sloping Curves’ Characterise New China Hotel Industry Report
Steeply downward sloping charts splashed across the 2009 Hotel Intelligence Report by Jones Lang LaSalle Hotels China come as no real surprise – 2008 and 2009 have been uncommon years all round for China’s hospitality industry.
The annual report reviews China’s hotel industry across 13 key markets: Beijing, Shanghai, Chengdu, Chongqing, Dalian, Guangzhou, Hangzhou, Qingdao, Sanya, [...]
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Written by Travel News on July 20th, 2009 with
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Steeply downward sloping charts splashed across the 2009 Hotel Intelligence Report by Jones Lang LaSalle Hotels China come as no real surprise – 2008 and 2009 have been uncommon years all round for China’s hospitality industry.
The annual report reviews China’s hotel industry across 13 key markets: Beijing, Shanghai, Chengdu, Chongqing, Dalian, Guangzhou, Hangzhou, Qingdao, Sanya, Shenyang, Shenzhen, Tianjin and Xi’an. It covers analysis of local economic performance, the respective tourism and hotel market, new supply in the pipeline as well as the market’s trading environment outlook.
The research reveals that many markets saw a decline in international and domestic tourist arrivals for the first time in years during 2008 which, coupled with strong supply growth, resulted in a decline in RevPAR in 10 out of the 13 markets. “The market is going through a very rough time and, considering new supply, it is not going to end anytime soon,” was Senior Vice President Lily Ng’s bleak prognosis.
Despite hopes that hosting the Olympics in 2008 would be a pinnacle point for Beijing tourism, China’s capital saw decreased international tourist arrivals in 2008 from the previous year due to entry visa and travel restrictions in the lead-up to the Games. A double-whammy followed in the form of a weakened global economy browbeating the planned-for post-Olympic demand. There was also a 59 per cent increase in new hotel room supply in 2008, with demand not expected to penetrate now until 2010/11.
Shanghai’s development has been in reverse to Beijing, with it’s own international event – the World Expo – upcoming in 2010. The impact of the global economic crisis became apparent in Shanghai in the second half of 2008 and the city’s five-star hotels in particular have had to drastically reduce room rates to bolster dwindling occupancy numbers. This pressure will continue in the near term as a number of high-profile new hotels are expected to open over the next 12 to 18 months, although hoteliers are hoping for a demand and profile boost during the six-month Expo period.
China’s Tier II and Tier III cities have benefited from vast governmental stimulus packages, however while room rates are increasing, they still lag significantly behind those in Tier I. China’s tropical island city of Sanya was identified as an interesting case scenario with comparatively low international and domestic visitor arrivals in stark contrast to the numbers of new hotels being developed as the government opens new bays and drives development in the region.
via China Business News – BizChinaUpdate – ‘Downward Sloping Curves’ Characterise New China Hotel Industry Report.
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Written by Travel News on July 20th, 2009 with
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