Modest growth in the third quarter

• As of YTD August 2024, Hong Kong welcomed 29.5 million international tourists, representing a 129% increase Y-o-Y. The primary source market continues to be Mainland China, accounting for 78% of the market share.
• In the first nine months of the year, hotels in Hong Kong recorded a marginal increase in RevPAR. Improvement in RevPAR was boosted by an increase in both occupancy and ADR.

Multiple openings expected before year-end

• During the third quarter of 2024, new hotel supply was limited to one hotel entering the Hong Kong market: the 114-key Ascott North Point, marking a return of The Ascott Limited into the city.
• Several hotel openings are expected for the remainder of the year, totalling 2,797 rooms. Notable expected openings include the 373-key Dorsett Kai Tak and the 536-key Metropark Hotel, both located in Hung Hom.

Investment market showing cracks: transaction volume rises as prices decline

• Two hotel deals were completed in Q3 2024: Urbanwood Hung Hom and the 63-key Popway Hotel for a total transaction volume of USD 151 million for the quarter.
• More transactions are expected to close before end-2024, leading to a total investment volume of USD 500 million as investors have adopted a more cautious approach, leading to a large bid-ask spread.

Outlook: Steady growth towards full recovery

• Tourist arrivals are accelerating Hong Kong’s recovery. The city’s third quarter was marked by a series of high-profile events, including the popular ULTRA Music Festival and concerts featuring global music stars.
• With the festive season ahead, lodging and tourism should continue improving for the last quarter of the year. Full recovery is expected by end-2025.