Macau Hotel Rates Decline Amid Expected Visitor Surge During CNY 2025

During the Chinese New Year (CNY) of 2025, a comprehensive survey conducted by Morgan Stanley suggests that Macau's hotel room rates will experience a noticeable decline. Based on data collected from 28 different hotels 14 days prior to the beginning of the CNY holiday, average daily rates (ADR) are projected to fall between 15 and 40 percent compared to the previous year's CNY period in 2024. This decrease is also expected to be 10 to 30 percent lower than those observed during the October Golden Week of 2024. The anticipated average rate for a standard room during these festive days, spanning from January 28th to February 4th, is set at HK$3,911, approximately $503 USD.

Price Variations Across Macau Hotels

Several prominent hotels in Macau are contributing to this drop in prices. The Venetian Macau leads with a significant 60 percent reduction in room rates. Following closely is the Grand Lisboa Palace with a 54 percent decrease, while both Sands Macao and Versace Macau are cutting their rates by 38 percent.

In contrast, a number of hotels are opting for an increase in prices. Notably, the Andaz Hotel at Galaxy Macau, the W Hotel at Melco’s Studio City, and The Parisian Macao are all reporting price rises of between 6 and 15 percent. These adjustments in hotel pricing can be attributed to various market challenges and a relatively subdued demand when compared to previous peaks. Nonetheless, the outlook remains optimistic for the city’s tourism industry, with predictions indicating a possible increase in visitor numbers this year compared to last year.

Visitor Numbers and Market Outlook

While hotel rates are on a downtrend, visitor numbers to Macau are expected to rise. A significant factor contributing to this increase is the influx of visitors from Zhuhai, spurred by the introduction of a new 'One Trip Per Week' visa policy on January 1st. This policy has led to a 26 percent year-on-year increase in the number of Zhuhai residents visiting Macau in the first two weeks of January. Historically, residents from this area made up around 10-12 percent of total Chinese visitors in both 2019 and 2023.

Additionally, a record-breaking milestone was achieved on January 18th when Macau recorded 803,000 border crossings in a single day, surpassing previous highs from August. Of these crossings, a substantial portion comprised tourists, predominantly from mainland China, accounting for 77.6 percent. In response to these promising visitor statistics, the Macao Government Tourism Office has revised its visitor projections for 2025 upwards to between 38 million and 39 million, which could see tourism numbers nearing those of pre-pandemic levels.

The positive visitor trends appear to be having a modest impact on the gaming sector as well. Morgan Stanley forecasts a 1 percent year-on-year increase in January's gross gaming revenue (GGR) to MOP628 million, or approximately $78.2 million daily. February is set to improve further, with a projected 7 percent growth to MOP709 million, equating to $88.3 million daily. Combined, the average daily GGR for the first two months of the year is expected to reach MOP667 million, or $83.1 million, equivalent to 78 percent of the 2019 levels.

Source: Macau Hotel Rates to Drop 15-40% YoY During CNY, Visitor Numbers to Grow, Asia Gaming Brief, January 20, 2025.

Posted by Wizard
Jan 20 2025