STR’s latest weekly performance data shows sustained revenue per available room gains for Chinese hotels.
SINGAPORE—Hotel performance in China continues to rebound as more of the country reopens, according to data from STR.
In a weekly data insights video, Jesper Palmqvist, area director of Asia/Pacific for STR, HNN’s parent company, said China hotels posted another strong week, “pushing (revenue per available room) to heights not seen since early January.”
With uncertainty around the coronavirus pandemic and economic trade negotiations with the U.S., STR is focusing on areas of stability in China rather than “setting a specific growth target” this year, he said.
One focus is gross-domestic-product performance across cities in China.
“In China, the GDP level of the four major first-tier cities is far ahead of the other cities, and the GDP of a provincial capital city is usually higher than other cities there, but it’s not necessarily always the case. There are exceptions in several provinces,” he said.
STR focused on four provinces where GDP is higher in the second city. These cities “often have a broader developed tourism industry, more high-end hotels, which generate a different kind of demand,” he said. One example is Liaoning.
“In the case of Liaoning, Shenyang is closing the gap, but trends seen in the last few years as development and investment focuses more on other Liaoning locations over Dalian,” he said.
Deferred and abandon projects
Palmqvist said only 2.8% of the hotels in the planning and final planning pipeline in January 2020 were abandoned or deferred.
“In addition to this, 19% of rooms that were in that planning and final planning stage are now, by April, into construction,” he said.
Of hotels in the January pipeline, “just over 210,000 rooms have 66% of their opening plans unchanged,” he said. “That is to say one-third will be postponed.”
Thirteen percent will open this year while 21% will open in 2021 or 2022, he said.
2021 will be an unusual year because 2020 was, Palmqvist said.
The Tokyo Olympics was pushed out and will be closer to the winter Olympic Games in Beijing in 2022.
“There is perhaps some early concern about that congestion this creates, which we’ll see later,” he said.
Editor’s note: The video included in this article was filmed by STR’s Jesper Palmqvist, on 28 May and edited and produced by CoStar Group. HNN is a division of STR, a CoStar Group company.