Extreme hotel price hikes during the Chinese New Year (CNY) holiday may no longer be a concern in Macau, given the increasing inventory and rational consumption trends.
Speaking to AGB, Andy Wu, the president of the Macau Tourism Industry Association, expects the hotel occupancy rate to reach over 90 percent during the CNY. However, he doesn’t anticipate crazy price hikes as seen in past holiday seasons.
Wu notes that Macau’s hotel room inventory has experienced a double-digit increase since 2019, adding more than 7,000 rooms and 20 hotels in the past four years. At the same time, overall economic circumstances have led to rational consumption trends.
In addition, he points out that the CNY Golden Week is a family travel season. In this context, some travelers may avoid going to Macau during this period.
According to official statistical data, as of November 2023, there were 149 hotel establishments in Macau, providing 48,405 rooms. The hotel room inventory was at 41,148 rooms and 126 hotels.
This implies nearly an 18 percent increase in hotel room offerings from the end of 2019 to 2024.
It’s also worth noting that Macau gaming operators have accelerated the launch of new hotels since Macau’s tourism rebounded rapidly after all travel restrictions were removed in early 2023.
Galaxy Entertainment Group (GEG) was one of the most progressive, unveiling Andaz Macau and Raffles Hotel in a very short period, adding nearly 1,000 hotel rooms to their Cotai property.
Melco’s Studio City also launched their new phase 2 with the W Hotels brand, part of Marriott International, and the self-branded Epic Tower, adding nearly 900 rooms.
SJM didn’t lag behind its peers, as it opened Palazzo Versace Macau and The Karl Lagerfeld Macau hotels last year, adding luxury hospitality offerings to its latest addition to the Cotai integrated resort – Grand Lisboa Palace.
Cotai hotel rooms sold out
Andy Wu indicates that hotels around the Cotai Strip are preferred by tourists. As of the end of January 26th, most of the Cotai hotels were already sold out. However, there is still availability in Macau Peninsula.
The Chinese New Year (CNY) Golden Week falls between February 10th-17th this year, and the travel rush has already begun as of last Friday (January 26th). Under his observation, the hotel prices during the CNY period stood at MOP2,000 ($248).
The management of GEG informed analysts from Goldman Sachs earlier this month that there are strong forward hotel room bookings for the CNY holidays. Most of the bookings have already been filled by players, with limited inventory left for retail.
In a mid-January update, the investment bank CLSA noted that hotel bookings were rapidly picking up. At four weeks out from the CNY weekend (10-11 February), its four-week leading average hotel prices are already 27 percent higher year on year.
According to the Macao Government Tourism Office (MGTO), the average hotel rate for all types of hotels in CNY 2019 (February) stood at MOP1,514 ($187), with a hotel occupancy rate of 93.6 percent.
However, the average hotel rate in January 2023 stood at MOP1,180 ($146), with a hotel occupancy rate of only 74 percent.
About 70 percent recovery
The Macau government expects 120,000 visitors per day during the upcoming Chinese New Year (CNY) holiday. This target matches the level of visitor influx into Macau over the Christmas holiday last month, exceeding the 116,000 per day level recorded during the October Golden Week in 2023.
The visitor arrival target of 120,000 per day translates into a 70 percent recovery compared to the 2019 CNY level when Macau received over 1.21 million tourists during the seven-day CNY period.
In 2019, Macau’s CNY visitor arrivals were boosted by various factors, such as the opening of the Hong Kong-Zhuhai-Macau Bridge, which brought in more than 30 percent of Hong Kong tourists from the previous year. International visitors also increased by 14.2 percent that year, with authorities attributing it to the festive atmosphere and favorable weather. During the 2019 CNY, Macau’s hotel occupancy rate reached 96.7 percent.
During the same interview, Andy Wu expressed the belief that the government’s projection is conservative, indicating that Macau surpassed Hong Kong to become the most popular travel destination among Chinese travelers in 2023.
According to data released by the China Tourism Academy, 50.9 percent of outbound Chinese travelers visited Macau in the first half of 2023. Wu considers that Macau continues to be the top choice for outbound travel this year. Macau received approximately 28.23 million visitors in 2023, with a daily average of 77,000, indicating a recovery of around 70 percent compared to the pre-pandemic year 2019.
The Macau Government Tourism Office (MGTO) has set a goal to welcome 33 million visitors this year. If realized, this would represent a nearly 17 percent increase from 2023.
