After the outbreak of the epidemic in Guangdong at the end of May, the occupancy rates of the two major cities in Guangdong—Guangzhou, Shenzhen, and other parts of the province—have fallen to the bottom. As the center of this epidemic, Guangzhou hotels have been more severely affected. With the implementation of anti-epidemic measures and accelerated vaccination, the Guangzhou epidemic has gradually improved in mid-June. Not only has Fangcun been unblocked, high-risk areas have been downgraded, and the occupancy rate of Guangzhou hotels has also improved. In Shenzhen, affected by the new cases in the Bao’an District on 14 June, it may take some time to recover.
The overall occupancy rate in Mainland China also showed a downward trend at the end of May and early June. Even the Dragon Boat Festival in the second week of June did not cause much splash in the overall market. However, with the improvement of the Guangdong epidemic, the overall occupancy rate in Mainland China rebounded with an extremely strong momentum in mid-to-late June.
Focus on summer vacation
The summer vacation of 2020 was an extraordinary summer vacation as the epidemic wasn’t yet clear, and the second wave of the epidemic struck, so many children and parents could only stay in the city or the province. In the summer of 2021, although it is not possible to fully return to before, the vaccination rate of 1.2 billion doses has also given everyone reassurance. Hotels have long been gearing up.
So, what was the summer vacation of those “normal” years in the past?
From the data of 2017-2019, the summer vacation not only boosted the occupancy rate on weekends (Friday and Saturday), but also lifted the occupancy rate on weekdays (Sunday-Thursday).
The occupancy rate of first-tier cities was the highest from Sunday to Thursday during the summer vacation (July and August). But perhaps beyond everyone’s expectations, during the summer weekend, the occupancy rate of the commercial capital cities (such as Jinan, Shijiazhuang, Shenyang, Zhengzhou, Nanchang, Hefei, etc.) not only catch up with the first-tier cities but also much higher than holiday markets.
Focusing on the Beijing market, the central area of Beijing (including the STR secondary market, Beijing International Trade Commercial District, Financial Street Commercial District, and Wangfujing Commercial District) not only leads the occupancy rate of other areas in Beijing during the summer (July and August) but also performed in terms of the average available room. If you look closely at the revenue performance of each available room, and the performance of the three years from 2017 to 2019, the third and fourth week of July and the third and fourth week of August were the best in the summer. In the last week of August, the income of each available room was almost cut off compared to the previous week.
Xi’an, which is also in the north and the ancient capital, is still the central area in the summer occupancy rate. Comparing the performance of different regions in the seven days a week during the summer vacation, Huancheng Park not only tops the list every day but also has had an occupancy rate of 92% on Friday and Saturday. Even on the Sunday that fell behind, the occupancy rate has exceeded 80%.
Finally, look at two theme parks (we selected all STR partner hotels within 5km from the theme park). Whether it is a hotel near Changzhou Dinosaur Park or a hotel near Shanghai Disneyland, August still had the highest occupancy rate throughout the year. So, will the summer vacation (July-August) give the most help to the week? The occupancy rate of hotels near the two theme parks increased the most on summer Saturdays compared to Saturdays in other months, and the hotels near Shanghai Disney also had a lot of summer benefits on Sundays.
For further insights into COVID-19’s impact on global hotel performance, visit our content hub.
