The upcoming May Golden Week in Macau is anticipated to witness a weaker performance in hotel occupancy and Average Daily Rate (ADR) compared to the recent Chinese New Year (CNY) holiday period. A survey conducted by Morgan Stanley analysts provides insights into the expected trends across 28 hotels in Macau during this holiday week, spanning from April 30th to May 6th, encompassing the official five-day holiday period from May 1st to May 5th, 2024.
Occupancy and ADR Trends
According to analysts Praveen Choudhary and Gareth Leung, the majority of hotels surveyed (60%) foresee weaker bookings during May Golden Week in comparison to CNY. Additionally, 40% of these hotels anticipate a decline in occupancy and ADR compared to the May Golden Week of 2019.
The decline in ADR is notably significant, with approximately 20% of hotels expecting lower rates compared to both CNY and the 2019 May Golden Week. Notably, hotels under Sands China’s operation, including Venetian, Four Seasons, and Parisian, appear to experience a more pronounced decrease in both occupancy and ADR, possibly influenced by ongoing renovation activities.
However, MGM China stands out with relatively stronger performance in both occupancy and ADR during this period.
Specific Hotel Performances
Galaxy Entertainment Group’s properties such as Galaxy Macau and StarWorld are prominently booked throughout the surveyed period, indicating robust demand. Conversely, Sands China-operated properties and Peninsula hotels like Mandarin Oriental and Wynn Macau are witnessing declines.
Interestingly, the Londoner Hotel stands out by charging higher rates during May Golden Week compared to the CNY period in February.
Gaming Gross Revenue Estimates
Morgan Stanley estimates daily Gross Gaming Revenue (GGR) during May Golden Week to range between MOP$800 million and MOP$850 million (US$99 million and US$105 million). This projection represents between 73% and 77% of 2019 levels and remains slightly below the 2024 CNY figures by less than 10%.
Macau’s hotel industry is bracing for a softer May Golden Week in terms of occupancy and ADR compared to recent holiday periods like CNY. While certain properties like those under MGM China exhibit resilience, others operated by Sands China and Peninsula hotels are experiencing declines. The gaming sector, as estimated by Morgan Stanley, is also expected to reflect a moderate decrease during this holiday period compared to peak holiday seasons of the past.