Exclusive | Hong Kong luxury hoteliers to delay 1,000-odd new rooms in market at disastrous levels due to pandemic and protests
- CK Asset Holdings has deferred the opening of its 840-room Hotel Alexandra in Fortress Hill to a later date
- A consortium has pushed back the 206-room The Silveri Hong Kong MGallery in Tung Chung by at least six months
CK Asset Holdings has deferred the opening of its 840-room Hotel Alexandra in Fortress Hill to a later date while a consortium of Hong Kong’s biggest developers has pushed back the 206-room The Silveri Hong Kong MGallery in Tung Chung by at least six months.
“The hotel opening is postponed due to the current virus situation,” Christina Cheng, general manager of Hotel Alexandra, said in an email. “There’s no confirmed opening date at this stage.”
The Silveri Hong Kong will open by June 30 instead of its original plan for the end of 2019, citing delay in construction schedule, according to a spokeswoman at Citygate Development, whose owners are Swire Properties, Henderson Land Development, Sun Hung Kai Properties, New World Development and Hang Lung Properties.
“We are closely monitoring the Covid-19 situation and assessing its impact on the opening date,” she added.
The two luxury hotels account for about a quarter of 4,092 new rooms planned for this year, according to the Hong Kong Tourism Board. As well as this, some 1,295 rooms from four hotels have been taken off the market for “renovation” for up to 20 months.
Hotel operators were only able to fill three in every 10 rooms in February this year as the viral outbreak escalated, compared with nine in the same month last year, according to the Board.
“It’s a disaster for hotel occupancy as visitor arrivals dropped from 4-5 million a month to just over 80,000,” said Martin Wong, a research and consultancy associate director for Greater China at Knight Frank. “It’s meaningless to open new hotels at this moment. Most hotel operators will not have high hope for the Labour Day holiday as the government has not relaxed travel restrictions.”
About 840,000 mainland Chinese visitors arrived in Hong Kong in the first three days of the Labour Day holiday in 2019, a five-year high. Fewer than 100 came each day on average in April ahead of this week’s holiday break, the tourism board said.
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There are about 84,000 hotel rooms in Hong Kong, of which 35 per cent cater for the luxury and upscale market, while the rest are midscale and economy hotels. Hotels undergoing renovation may be preparing themselves for the rebound.
“The closures of these hotels are examples of this trend,” said Corey Hamabata, senior vice-president at JLL Hotels and Hospitality Group. “The current environment is an opportunity for well-capitalised owners to reposition their properties for the recovery.”
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