China waits for Olympic revpar boost

07 August 2008 by
China waits for Olympic revpar boost

The Chinese hotel industry has experienced nationwide declines in revpar through the first half of 2008 and is looking to the Olympics to boost profit, according to a survey.

STR Global's monthly survey of 528 internationally branded Chinese hotel properties found that Chinese national occupancy fell 6.9% in the first half of 2008 to 60.8%.

It also found that although average daily rate increased by 2.3% to $133.31 (£68.27), revpar declined by 4.8%.

James Chappell, managing director of STR Global said the Chinese hotel industry had "thus far faced a year of significant challenges ranging from natural disaster to uncertain global economy".

He added: "The Chinese hotel industry will be looking to the Olympics to provide the profits in 2008."

Chinese local market performance is also down, with hotel openings and demand both lower than expected in the run up to the Olympics, occupancy has dropped 10.7% to 61.8%, although a 7.6% boost in rates has helped to offset this somewhat.

In Shanghai occupancy as fallen 8.5% to 59.1%, with rates also falling by 1.6%.

Performance in Hong Kong was flat, but maintained 80.6% occupancy; the highest in China.

Chappell said: "Many of the new hotels in northern China were developed specifically to meet the needs of the Olympics. It will be interesting to see if Chinese markets can adapt the new supply levels when the Games move on."

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By Gemma Sharkey

E-mail your comments to Gemma Sharkey here.

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