Macau worst hit by Covid-19 among APAC hotels: STR

Hotels across the Asia-Pacific region have taken a severe dip in occupancy amid the Covid-19 outbreak, with Macau, Hong Kong and Taiwan the most deeply impacted, according to preliminary February data from STR.

Pulling from Tourism Economics’ global top 20 for mainland China outbound travel, STR analysed 14 markets for a six-week period, beginning January 6 till February 16.

Macau registered the steepest occupancy decline in the Asia-Pacific region amid Covid-19

“With so much dependence on Chinese arrivals, it was anticipated that key markets around the region would see a negative impact from the coronavirus outbreak,” said Jesper Palmqvist, STR’s area director for the Asia-Pacific region.

“In certain markets, we saw an almost immediate decline in occupancy levels in the early days of February. Already a low business travel period due to the Chinese New Year holiday, drops in occupancy were worsened in the wake of the World Health Organization’s announcement of a global health emergency on January 30. The impact will likely continue until containment is reported and recovery begins.”

When comparing the first week of the analysis with the last, Macau saw the steepest occupancy decline (-97 per cent), falling from 96 per cent to just three per cent in a matter of six weeks. The 15-day shutdown of casinos in the market is a key reason behind the significant drop, Palmqvist noted.

Meanwhile, Hong Kong (-64 per cent to 25 per cent), already suffering from a political crisis, and Taiwan (-59 per cent to 26 per cent) were next on the list of decreases. On the other hand, Australia (+11 per cent to 73 per cent) and Indonesia (+four per cent to 58 per cent) reported increases in the metric, thanks to more recent gains.

Palmqvist said: “For those more moderate impact markets, consistent occupancy declines began with the week of Chinese New Year. The new and lower levels for these markets are in line with what was seen after the global financial crisis in 2009.

“For those markets with more stable occupancy, less dramatic declines are partially due to distance from mainland China, volume of visitors, stronger domestic or diverse travel drivers and a reasonably solid level of continued airlift. Australia was already off to a quiet start in 2020 due to the bushfires in several populated states in the country.

Indonesia has felt some occupancy and rate impact in Bali, a popular market for Chinese travellers now gone, but not at the same levels as elsewhere.”

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