NewHong Kong hotel owner Magnificent Estates boasts 97pc occupancy rates
Company chairman William Cheng offers his outlook for the hotel industry and the challenges it faces
William Cheng Kai-man, who serves as chairman of Magnificent Estates and holds a 71 per cent stake in the company, has grown the business from one 206-room hotel into one of the city's largest medium-tariff hotel operators since 2003.
Today, the company owns 2,300 rooms in six hotels in prime areas in Hong Kong, and one hotel in Shanghai . Leveraging on his expertise in construction and property investment, Cheng built up his portfolio through site assembly and the redevelopment of ageing residential projects into high-yield hotel developments.
His efforts have paid off. Hong Kong hotels in prime and non-prime locations enjoyed good growth for 11 straight years, until recently.
Now the hotel industry faces challenges in filling up rooms because mainland package tours - the bread and butter of Hong Kong hotels - have halved since Lunar New Year in February.
Despite the current market difficulties, with the shrinking of mainland groups, individual travellers and those from Southeast Asia, the hotels' month-to-day occupancy rate averaged 97 per cent. Pre-bookings for the Labour Day holiday and the remaining days of May are good and encouraging despite May and June being the traditional low season. There are always a few quiet days after the holiday.