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May 1, 2012

Shanghai's room rates fail to keep pace with supply

Shanghai's comparatively low room rates to other Asian cities remain a bugbear for the city's hoteliers, but are helping to boost demand for the destination.

According to Advito, the independent consultancy arm of BCD Travel, the average daily rate (ADR) for Shanghai hotels in the last quarter of 2011 was US$193, compared to US$252 in Singapore and US$306 in Hong Kong.

Speaking to the Daily, Jenny Xia, assistant director of sales-MICE, The Westin Bund Shanghai (pictured), said: “The onslaught of new rooms in the last quarter and so far this year, and the resulting intensive competition have caused rates to drop. In our case, ADR slipped by five per cent as occupancy fell.”

Christophe Lajus, chairman of International Branded Hotels of Shanghai Association, said: “Despite the influx of MICE events in recent years, occupancy rates in Shanghai are painfully low when contrasted to comparable cities such as Singapore and Hong Kong. The rate of arrivals, including MICE, has simply not kept pace with the growth in supply.”



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