Hong Kong guesthouses and small hotels are expected to see the worst business environment in 12 years during the upcoming national day holiday.
Average room rates have been slashed 15-20 percent for the so-called “golden week”, the Hong Kong Economic Journal reports, citing Sylvia Chung, deputy chief executive of L’hotel Management Co. Ltd.
Chung expects booking rates at 80-90 percent for the group which is planning to partner with theme park operators to lure tourists.
Meanwhile, a hostel operator has fallen victim to the tough market conditions and decided to sell the property, according to the report.
The new owner plans to turn it into subdivided flats.
Also, some three-star hotels have cut their nightly room rates to HK$70 (US$7.74), well below the hostel rate of HK$100, which is down from about HK$300 to HK$400, hostel operator Ta Li-na said.
Tai expects the overall occupancy rate of hostels to come in at about 40 percent during the golden week holiday, worse than during the SARS outbreak in 2003.
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