Macau Hotel Occupancy Improves, But Omicron Threat Looms

December 31, 2021 Emerging Markets

Macau’s hospitality industry in November saw a 44.1% occupancy rate, or a 2.4% increase year-over-year. Macau has been one of the longest-standing bastions against the global pandemic, with the special administrative region (SAR) registering not a single COVID-19 case since early into the pandemic. That was until recently.

However, the region has reported its second Omicron case which could enforce new lockdowns and send the occupancy rate in December and most likely in January plummeting once again, after a short-lived recovery.

Hotel Occupancy Inches Slowly up in November
Registered hotel accommodation averaged 46.8% for all categories, which is another 2.8% increase year-over-year, based on data released by the city’s Statistics and Census Service and reported by GGRAsia.

The data looked into the 35,000 available hotel and guest house rooms which gave the statistical office enough information to see how the hospitality industry fared. To draw an accurate conclusion, Macau’s Statistics and Census Service excluded any rooms designated for quarantine.

The occupancy rate was almost the highest for five-star rooms with 52.9% on average compared to 53% for three-star room occupancy.
A total of 1.3% more visitors were recorded in November 2021 on a year-over-year basis, or a total of 480,900 people.

The length of individual stays also extended to 1.8 nights, up from 1.6 nights from a year before. However, any future recovery depends on how China reacts to the new cases of Omicron. Usually, the country prefers to put entire cities and provinces on a complete shutdown in a bid to weed out the virus.

A second imported case of Omicron in Macau is already too risky, and it may see China promptly change the open-border arrangement it has with Macau presently. Should Beijing choose to suspend travel, that would once again impact operating results of not just hotels, but also the casinos that they are most commonly linked to.