Macau’s average occupancy rate for three- to five-star hotels showed year-on-year decline in January, the month that included the latest Chinese New Year holiday period, and also witnessed at month-end the beginning of the local alert on the coronavirus outbreak.
For January, the average occupancy rate of the city’s three- to five-star hotels stood at 78.5 percent, down by 14.5 percent year-on-year, according to the latest figures from the Macau Hotel Association, a local trade body, disclosed by the Macao Government Tourism Office (MGTO). The occupancy rate of Macau’s five-star hotels during the month was 85 percent, representing a 10.3 percent decrease when compared to a year ago.
By last week – when the coronavirus alert’s chill on casino business locally and on tourist travel around the region appeared to be at full power – the percentage occupancy rate of the city’s five-star hotels, the category most commonly associated with the city’s casino resorts, was down to “single-digit” level, said on Tuesday the tourism office’s director, Maria Helena de Senna Fernandes.
Up to the point that the crisis hit home, some trends for January hotel business had been positive. According to the latest data, during that month, the city’s average hotel room rate in each category – with exception of four-star places – had increased. During January, the average room rate for the three- to five-star hotels stood at MOP1,469.30 (US$183.80), representing a 12.4-percent rise year-on-year. The average room rate for the five-star hotels stood at MOP1,734.00, which was 12.2 percent more than a year ago.
China’s State Council had originally designated January 24, a Friday – as the eve of Chinese New Year – with the festive period running until January 30 inclusive. But China’s central government later extended the holiday to February 2 as part of the country’s response to the coronavirus crisis, and to avoid mass movement of people returning to their respective place of work.
As of the festive week running from January 24 to January 30, Macau saw a 78.3 -percent decline in visitor arrivals compared to the prior-year celebration. The holiday time varies each year depending on the lunar calendar.
The average occupancy rate of the city’s five-star hotels during the latest Chinese New Year was 55.3 percent, down by 42.3 percentage points when compared to last year.
Ms Senna Fernandes remarked to the local media on Tuesday that the tourism bureau could not predict how Macau’s tourist arrival figures would turn out this year due to “uncertainties” regarding how quickly the threat of the novel coronavirus – which causes the Covid-19 respiratory disease – would subside. Currently, Macau has over 41,100 guest rooms, according to MGTO data.
“We saw a huge blow to both inbound and outbound tourism. Now our average hotel occupancy is at around 11 percent. That is worse than the Sars [severe acute respiratory syndrome] outbreak period,” said Ms Senna Fernandes at Tuesday’s briefing.
The tourism boss also noted in her remarks that day that the average percentage occupancy rate of the city’s five-star hotels was only at “single-digit” level as of the period Saturday, February 15 to Friday, February 21 inclusive. During that seven days, the average room rate of the city’s hotels and inns amounted to MOP690, a low point “unheard of” in over a decade, the official remarked.
“At MGTO we are now working on recovery plans for the tourism sector…As of this week we will be contacting hotels and travel agencies to understand their thoughts, and see what we can do for our future,” Ms Senna Fernandes told the media on Tuesday.
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"The Macau recovery continues to be disrupted by false starts, while the lack of [Chinese] public holidays for rest of the year should cap the pace of the rebound”
Andrew Lee and David Katz
Analysts at brokerage Jefferies LLC