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Hotel rates up 20% during Shanghai Expo
2010. 10 March
(business.globaltimes.cn)
With the upcoming of the Shanghai World Expo which will be held from May 1 to October 31, hotel rates in the city have jumped about 20 percent, according to a People's Daily online report Wednesday.
A report by the China Economic Weekly says the room rates of five-star hotels like the Shangri-la, Grant Hyatt and Hilton
Statistics from Ctrip.com, a leading online travel service company in China say that the demand for rooms from economy hotels was more than four times than that at the end of last year and the prices also increased at different levels.
Meanwhile, the person in charge of rooms at the five-star JW Marriott Hotel in Shanghai said that prices may grow further as the expo draws nearer.
Currently, Shanghai has 550,000 beds, or 340,000 rooms; this is enough accommodation during normal periods, but not enough during the holidays, according to Han Zheng, mayor of Shanghai.
The upcoming World Expo is expected to bring in an estimated 70 million visitors and 58.5 million may from the other provinces or overseas, with the People's Daily online report estimating an additional 400,000 beds are needed a day on average.
But industry analysts said that the current number of beds may not satisfy demand during the World Expo since rooms in five-star hotels make up 32 percent of the total rooms. As these luxury hotels charge high prices, they may not have 100 percent occupancy. In addition, some small hotels that do not have high standards in terms of room quality may not meet the requirements of visitors for the Shanghai Expo.
Analysts worry that it may repeat the crazy high prices for living in hotels in Hainan Province during the Spring Festival. Due to market speculation, the room rates at some hotels in the southernmost province exceeded more than 10,000 yuan a night.
After the expo ends, the hotel industry may face the problem of overcapacity. But some analysts believe that Shanghai hotels will only experience short-term speculation and the city's hotel industry can recover quickly since supply is greater than demand.
The Shanghai Expo is expected to drive consumption to between 60 billion yuan to 100 billion yuan, with hotels expected to account for about 34.3 percent, according to the People's Daily report.
The Shanghai Expo organizers have said that the municipal government has asked hotels to control the rise of room rates.
Source: business.globaltimes.cn