Demand surges due to visa-free policy extension

• The extension of visa-free policies has opened new opportunities for guest sources. While domestic tourists reached 38.68 million as of YTD Nov 2024 (+8.4% YoY), international tourists in Beijing totalled 3.54 million (+189% YoY), including 1.67 million overnight guests.
• In addition, the Sibos annual conference in October attracted over 10,000 participants from more than 150 countries and regions to Beijing. This four-day conference also significantly boosted guest sources for Beijing’s hotel market.

Limited supply growth forecasted for Beijing’s upscale hotel market

• The pipeline for upscale hotels in Beijing is expected to remain limited over the next two years, with no new openings of upscale hotels in the fourth quarter of 2024.
• According to JLL’s statistics, compared to other tier-one cities in China, Beijing’s figures for upscale hotels will grow at a CAGR of 0.5% over the next decade, starting from 2024.

Stable performance with positive RevPAR growth in Beijing’s upscale hotel market

• The performance of the upscale hotel market in Beijing remained stable in the second half of 2024, demonstrating a steady upward trend compared to the same period in 2023.
• By November 2024, the ADR (Average Daily Rate) of Beijing’s upscale hotel market experienced a slight decline compared to the same period in 2023. However, occupancy rates increased, resulting in positive RevPAR (Revenue per Available Room) growth.

Outlook: The 12-month outlook remains cautiously optimistic

• Domestic arrivals in Beijing are expected to peak during the Spring Festival, supporting demand in the upscale market. The impact of the visa-free policy is likely to continue benefiting inbound tourism, bringing opportunities for tourism and hotel spending in Beijing.
• Looking ahead, there are challenges for upscale hotels in Beijing and across the country in terms of F&B and wedding banquets. Hotel operators need to plan ahead for market expansion, product and service differentiation, and seek opportunities for market breakthroughs.