Less than 30% of Hong Kong’s hotel rooms were occupied in August as tourists chose to spend their summer vacation elsewhere and business travelers moved meetings and exhibitions to Shenzhen and Singapore, when the city was in the thick of mass rallies and chaos, ignited by the China extradition bill.
The city’s Hotels, Food and Beverage Employees’ Association surveyed a number of four- and five-star hotels and found their average occupancy rate hovered at 30% throughout the past month and as low as 10% for those located in protest hotspots, including Central, Admiralty, Causeway Bay and Tsim She Tsui, which used to be teeming with shoppers and business people.
Behind the empty rooms and restaurants during a traditional peak season of travel was a 40% slump in the number of arrivals to Hong Kong, the biggest fall since the SARS epidemic of 2003. The city’s airport authority also noted that since June, 850,000 fewer flyers passed through the airport compared with a year ago. Hong Kong on average received only 15 guided groups from mainland China during the first 10 days of September, according to the city’s Travel Industry Council.
Also gone are the long queues outside Louis Vuitton, Hermès, Versace and Chanel boutiques on Canton Road and in Central.
Many hotel and restaurant employees have been forced to take no-pay leave after room rates fell by half or more amid the feeble demand.
Apple Daily reported that a five-star hotel owned by an international group had stopped hiring part-time dishwashers and the work was instead being taken over by lobby managers in their executive suits, part of the hotel’s retrenchment measures.
Four hotels owned by Li Ka-shing’s Cheung Kong Holdings are now offering a 3% rental rebate to guests who sign year-long contracts.
The unemployment rate in the city’s hospitality and catering sector rose by 0.7% year-on-year to 4.6% during June and August, according to data from the Hong Kong government. Industrial associations say whether there is a turnaround depends entirely on when the protests and unrest come to an end, something no one in the city is certain about.
Further adding to the problem is the fact that many ailing restaurants and shops are forced to shut for the sake of safety and turn away the very few patrons they still have, when protesters and riot police engage in pitched street battles, usually on weekends, with Molotov cocktails being thrown and tear gas fired.
Castles, theaters and the American town at Hong Kong Disneyland have also fallen quiet since the outbreak of mass processions. Spooked parents, especially those hailing from mainland China, Taiwan and Southeast Asia, have canceled their visits, fearing their children could be in danger. To woo locals, the amusement park is now offering a HK$688 (US$88) package of two admissions for two adults until after Halloween.
The BBC quoted Walt Disney CEO Bob Iger as saying the park had become a collateral victim of the protests.
Tourists are also becoming an “endangered species” at Ocean Park, an amusement park and zoo, where admissions in July and August dropped by almost a third, according to local papers.
The notorious parallel-trading in northern Hong Kong – locals and mainlanders hauling foreign-branded infant formula, cosmetics and other daily necessities for resale across the border on the mainland – has also taken a toll. However, residents living in districts close to the mainland border have no sympathy for drugstores and supermarkets that are affected, as they hope the retail downturn can lower rent and bring back mom-and-pop stores and eateries that cater to locals’ needs.