Macau's February Five-Star Hotel Rates Decline

In February, the average nightly rate for a five-star hotel room in Macau experienced a nearly 10 percent decline year-on-year, continuing a trend of eight consecutive months of decreases since July. This insight comes from the latest data released by the Macau Hotel Association and published by the Macao Government Tourism Office (MGTO). The specific figure for February's average five-star hotel room rate was MOP1,581.8, equivalent to US$197.5, marking a 9.7 percent drop from the previous year's rate of MOP1,751.3.

Despite the year-on-year decrease, the rate showed a modest sequential increase of about 2 percent from January's rate of MOP1,550.2. This nuanced shift in the market reflects the complex dynamics at play within Macau's hospitality sector, influenced by various factors including seasonal demand and broader economic conditions.

Detailed Analysis of Hotel Performance

The Macau Hotel Association, which currently boasts 47 member hotels including 26 five-star properties, primarily located within the city's casino resort complexes, reported that the average room rate across all tiers of its member hotels also saw a decline. In February, the rate across all categories fell by 8.8 percent year-on-year to MOP1,408.0. This indicates a broader trend affecting various segments of the hotel market in Macau.

The impact of the Chinese New Year holidays, a significant period for tourism from the mainland which is the primary market for Macau's gamblers and tourists, was evident in the data for February 2024 and 2025. In 2024, the holiday spanned eight days from February 10 to 17, encompassing two Saturdays. Conversely, in 2025, the holiday was also eight days long but ran from January 28 to February 4, including just one weekend. These variations in the timing of the holiday, dictated by the lunar calendar, contributed to the year-on-year differences observed in hotel performance.

Despite the decline in room rates, occupancy rates told a different story. In February of this year, five-star hotels under the association's umbrella achieved an occupancy rate of 95.2 percent, a notable increase of 4.3 percentage points compared to the previous year. Across all categories—three-, four-, and five-star—the average occupancy rate was 94.6 percent, up 5.1 percentage points year-on-year, suggesting robust demand even amidst declining rates.

Long-Term Trends and Market Composition

Following the easing of travel restrictions post-Covid-19 in January 2023, the five-star hotel rate among the association's properties peaked at MOP1,766.9 in December of that year. This peak underscores the resilience and potential for recovery within the sector, although the subsequent declines indicate ongoing challenges.

Macau's hotel market is predominantly composed of five-star accommodations, which as of January, accounted for 57.8 percent of the city's total hotel rooms. Out of the total 42,000 hotel rooms, 24,300 were classified as five-star. However, the number of five-star rooms saw a decrease of 13.0 percent compared to the same month in 2024. According to data from the Statistics and Census Service, the average occupancy for five-star hotels in January was 92.0 percent, with guests staying an average of 1.8 nights.

This comprehensive overview of Macau's hotel market highlights the interplay of various factors influencing room rates and occupancy levels. The data reflects the resilience and challenges of the hospitality sector in adapting to changing market conditions and seasonal fluctuations.

Source: Macau's February 5-star average room rate fell by almost 10 percent y-o-y to US$198: trade, GGRAsia, March 25, 2025.

Posted by Wizard
Mar 25 2025