bodyType

customContents

entityId

entityUuid

articlePageQuery

filter

article

articleBaseAdvertisingInfoArticle

articleListArticle

articleSeoArticle

helpersCheckIsPostiesArticle

hooksArticleAcknowledgementGateOverlayArticle

hooksTrackPageViewArticle

hooksContentInterestArticle

articleLinkingDataContent

articleSchemaContent

liveArticle

advertZone

sentiment

contentLock

topics

types

sections

moreOnThisArticles

urlAlias

commentCount

sponsorType

authorLocations

authors

paywallTypes

corrections

displaySlideShow

multimediaEmbed

printHeadline

seriesContainer

socialHeadline

headline

flag

firstTopic

glossary

flattenTypeIds

publishedDate

additionalInfoBoxes

images

image

relatedLinks

relatedNewsletters

__typename

createdDate

sponsor

factSheets

series

disableOffPlatformContent

published

updatedDate

summary

subHeadline

body

keywords

copyrighted

customTimezone

liveContents

Sandy Li

Disneyland's opening on September 12 is likely to bring many visitors to the SAR, but a land-premium spat between developers and government may result in a shortage of three-star hotel rooms

Hong Kong is facing a potential shortage of three-star hotels if a disagreement between developers and the government over land-premium charges for the conversion of land for hotel use   is prolonged,  industry observers warn.

Anticipating that tourist arrivals will reach new heights this year  with the opening of Hong Kong Disneyland on September 12, analysts and surveyors said the influx would put immense pressure on  room supply, particularly at three-star hotels.

A spokeswoman for Hong Kong Disneyland said it had received 3,000 confirmed bookings since its two hotels  began taking reservations a week ago.

UBS hotel analyst Eric Wong said the record number of tourist arrivals and near-full occupancies seen in normally quiet months  last year signalled that the supply of hotel rooms was tight.

'Disputes between developers and the government over land premiums for hotel redevelopment have been unsettled for almost a year,' he said, adding that the situation would be aggravated if  left unresolved.

It would take a couple of years for these hotels to be completed even if they reached a premium agreement with the government, he said.

Lee Shau-kee, chairman of Henderson Land Development, last year voiced concern that the land premium for hotel redevelopment was unreasonably high, rendering  the company's hotel redevelopment plans unviable at industrial sites in Kwun Tong and San Po Kong.

The group has applied to convert 10 industrial sites into hotel developments, with a potential supply of 10,000 rooms.

'With increasing  difficulty in making a hotel reservation and more expensive room rates, tourists may be forced to shift their holiday destination from Hong Kong,' Mr Wong said.

Although Hong Kong has 19 new hotels - representing a record high of about 9,000 rooms  a year -  opening their doors this year, industry watchers  said the growth in tourist arrivals would continue to outpace the new supply of rooms.

Given the government's  projection that tourist arrivals would reach 35 million in 2010, Mr Wong  said the number of hotel rooms, across the board, should increase by 50 per cent  to accommodate the explosive growth in tourism.

Total tourist arrivals reached  a record high of 21.81 million last year - up 40.4 per cent from the year before during the Sars outbreak.

However, figures complied by the Tourism Board show that  a year-on-year 20 per cent rise in new rooms would  be available this year, bringing the total to 47,431.

Pang Shiu-kee, head of property consultants S.K. Pang Surveyors, shared Mr Wong's view and projected  that the developers' chances of having  lower land-premium charges  were  slim.

'Developers have no grounds to ask for a lower premium charge  when most hoteliers are reporting brisker business,' he said.

The average occupancy rate across all categories of hotels and tourist guest houses, according to the Tourism Board, reached 91 per cent in December and 88 per cent for the whole of last year - both figures are the highest since 1996.

Hong Kong Hotels Association executive director James Lu Shien-kwai, however, rejected the suggestion that there was a shortage  of hotel rooms, saying that 3,000 rooms  in three-star hotels would be available this year.

'Only three out of 10 mainland tourists will stay in hotels when  visiting Hong Kong. The remainder   are either same-day travellers or are staying at their relative or friends' homes in Hong Kong,' he said.



Plenty to see, but nowhere to stay