APAC shows continued hotel performance recovery: STR

The Asia-Pacific hotel industry has reported continued performance improvement from Covid-19 low points thanks to strong domestic demand and holidays, according to a performance outlook presentation by Jesper Palmqvist, STR’s area director for the region during last week’s Hotel Investment Conference Asia Pacific 2020.

“Unlike the declines we’ve seen in the US after Labour Day or Europe after the summer holidays, Asia-Pacific markets have continued seeing growth,” Palmqvist said.

“For instance, in September, 70 per cent or better occupancy levels were registered in key China markets such as Sanya, Shenzhen, Chengdu and Xi’an. What is more noteworthy is that these markets are showing year-over-year growth in the metric, which is not common for most of the world right now.”

STR tracks improving hotel occupancy performance across key markets in Asia-Pacific

China’s demand has grown consistently over the months due to strong domestic demand and national holidays. On October 3, during the extended Golden Week period – a result of National Day coinciding with Mid-Autumn Festival – the market posted an 83 per cnet occupancy, almost reaching levels last seen in 2019.

During Silver Week (September 19 to 22), Japan witnessed an occupancy boost driven mainly by domestic demand. The market posted its highest occupancy level on September 23 (67 per cent). Similar to other markets around the globe, regional and leisure destinations like Hokkaido and Okinawa have begun to see more substantial occupancy growth, while Tokyo and Osaka are starting to see gentle initial growth.

Hotel occupancy in New Zealand is also just 25 per cent shy of 2019 levels.

In many of the key markets in Asia-Pacific, weekends continue to produce the highest occupancy levels.

Resort locations in Vietnam have posted occupancy as high as 40 per cent during the weekends.

Weekdays in South Korea are still showing low occupancy levels (20-25 per cent) compared to weekends (60 per cent) in the market.

Hong Kong is another market displaying a similar trend as occupancy levels during weekends reached as high as 55 per cent along with weekdays rising to 40 per cent.

Palmqvist noted that “all eyes are on the success rate of the recently declared government agreement with Singapore for a quarantine-free travel bubble, expected to produce direct travel between the two markets before the end of year”.

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