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Golden Week Covid Outbreaks Slow Recovery

Alan Woinski

October 11th, 2022

Skift Take

  • While Golden Week was a bit tarnished for hoteliers in China, it created a breeding ground for Covid cases and that was not a disappointment.
  • The number of Adelaide hotel rooms filled in one night hit a new high last month.
  • For Macau, a Covid boom means new quarantine and other measures, bringing down the mood after there were 163,000 mainland visitors entering the city during the seven days of Golden Week.

The number of Adelaide hotel rooms filled in one night hit a new high last month. On September 27, World Tourism Day, there were 9,001 CBD hotel rooms occupied of the total 9,911 available. This broke the previous record of 8,967 rooms occupied, reached the week prior. Nightly occupancy hit its highest since the start of the pandemic at 91%. A combined 5,000 visitors to the CBD were brought in by a combination of major events and conferences taking place. The week ending October 1 saw average occupancy of 84%, the best weekly average since the start of the pandemic.

While Golden Week was a bit tarnished for hoteliers in China, it created a breeding ground for Covid cases and that was not a disappointment. China had urged their residents not to travel or get together during the holidays to stop the spread of Covid but that clearly did not happen. Chinese health authorities reported 1,900 confirmed cases on October 9, a three-fold increase over 548 new cases on October 1. October 9 had 1,900 more cases than the Chinese government is trying to accomplish.

For Macau, this also means new quarantine and other measures, bringing down the mood after there were 163,000 mainland visitors entering the city during the seven days of Golden Week. The casino revenue did not keep pace with the increase in visitation but it is a different crowd and it is a crowd that comes to Macau for other reasons than gambling. The total number of visitors for the week was over 182,000. The average occupancy rate of Macau hotels during Golden Week was 66.7%, up 28.1 percentage points over the daily average in the whole month of September.

Savills Hotels Asia Pacific predicts that in the next three years, the number of hotels and resorts in key destinations in Vietnam will grow at an average rate of 20%. Even before the pandemic there were concerns of overbuilding in Vietnam. Vietnamnet published a blunt story on how hotels are offering discounts of more than 40% on room rates. The Khanh Hoa Hotel Association said this is due to the overbuilding of hotels and resorts in their area the past few years. The Khanh Hoa Provincial Department of Tourism said the province has more than 52,000 hotel rooms, about 50% of which are rated 3-5 stars. Many large scale projects of 500-700 rooms are still under construction. The Vietnam Hotel Association said there are 38,000 accommodation establishments nationwide, with 780,000 rooms. The number of 4-5 star hotels is 500. It is not even as Savills said big cities like Ho Chi Minh City or Hanoi do not have enough hotels but coastal localities have an excess of resort products, especially 3-4 stars or less. In Cam Ranh, Phu Quoc and Ho Tram, total supply in the next few years is expected to far exceed the actual number of visitors.

Hilton announced its Waldorf Astoria Hotels & Resorts luxury hotel brand entered the Vietnam market with the signing of Waldorf Astoria Hanoi. The hotel is owned by BRG Group and will be managed by Hilton when it opens in 2025. The Waldorf Astoria Hanoi will join Hilton’s pipeline of nine other hotels and resorts that will open in Vietnam in the coming years. The upcoming Waldorf Astoria is a conversion of the current Hilton Hanoi Opera and will feature fully reimagined accommodations across each of its 187 rooms and suites, after extensive renovations are complete. The luxury hotel will feature four world-class dining concepts including the brand’s famous lounge and bar, Peacock Alley. The hotel will also include the Waldorf Astoria spa.

The Lux Collective and P Q Hai Quoc Joint Stock Company announced the signing of a hotel management agreement to build a luxury overwater resort under the LUX* Resorts & Hotels brand on the island of Phu Quoc in Vietnam. LUXNAM* Phu Quoc is expected to open in late 2024. The overwater resort will be located on the Northern coast of Phu Quoc, adjacent to a UNESCO-listed Biosphere Reserve spanning over 314,000 square meters of flora and fauna, evergreen forest and dense mountain range. This will be a first for Vietnam with overwater resorts inspired by the Maldives. The 126 villa-only resort includes 109 overwater villas (most with private pools), 13 beach pool villas, 2 penthouses and 2 beachfront pool mansions. Set overwater on stilts are intimate and private one-to-five bedroom villas and penthouses. It will also feature restaurants with world class cuisine, spa, fitness center, four swimming pools, a children’s playground and other modern facilities and amenities.

Reuters reported after Japan’s reopening to visa-free international travel this week will be done with a problem that is not just in the country. Japan has extreme staffing shortages at their hotels. This is occurring while the government is saying they are aiming to attract 5 trillion yen (US$34.5 billion) in annual tourist spending. Market research firm Teikoku Databank said 73% of the hotels in the country were short on staff back in August. In 2021 only 27% had that issue. Government data said hotel employment fell by -22% between 2019 and 2021.

The W Hotel in Sydney was supposed to open in 2020. Marriott announced that after all the delays, the hotel will be opening in the space formerly occupancy by Sydney’s IMAX theater in October 2023. The wave-like building will have 585 luxury rooms and suites, views of the Darling Harbour, a two-story rooftop bar, a heated infinity pool, restaurant, spa and the usual hotel facilities such as a gym and event spaces. One side of the building will look out over the water while the other side will face Chinatown and Sydney’s downtown. The hotel will give guests easy access to the International Convention Center and Darling Square.

Accor announced the signing of Fairmont Udaipur, located in the historical city of Udaipur, Rajasthan in India, set to open in 2024. The agreement was signed with Keystone Resorts Pvt Ltd. The hotel will feature 340 guest rooms with over 100,000 square feet of banqueting and events space, a variety of outdoor venues, recreational spaces, dining facilities and Fairmont’s signature Spa.

Sumitomo Realty and Development Co said it will open part of a 1,717-room hotel complex directly connected to Tokyo’s Haneda airport, the largest of its kind in Japan on December 21. The complex, connected to the airport’s international terminal or Terminal 3, will begin operations at its two hotels – Villa Fontaine Grand and the higher-end Villa Fontaine Premier. The facility is scheduled to fully open in January and will also comprise a large-scale conference hall, a shopping area, a bus terminal and an open-air bath with a view of Mt. Fuji. The complex was initially scheduled to open in April of 2020 but the plan was delayed due to the coronavirus pandemic.

George Tanasijevich has left Las Vegas Sands/Marina Bay Sands in Singapore after almost 20 years. George was reported to have accepted a position at a major real estate project in Riyadh, Saudi Arabia. Tanasijevich headed the Marina Bay Sands property for nine years and two years ago switched to dual roles as Managing Director of MBS and Managing Director of Global Developments for parent company Las Vegas Sands.

Alan Woinski

October 11th, 2022

Companies: Accor, BRG Group, Fairmont, Hilton Hotels & Resorts, Keystone Resorts Pvt Ltd, Marina Bay Sands, Marriott International, Sumitomo Realty and Development Co, W Hotels, Waldorf Astoria Hotels & Resorts

Locations: Adelaide, Australia, Japan, Macau, Rajasthan, Singapore, Sydney, Tokyo, Vietnam

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