Year of the Snake: A look at hotel performance during Chinese New Year

Overall Performance in Mainland China

The Spring Festival, or Chinese New Year, is China's most important traditional holiday, and has always been a peak period for travel and tourism. This year, the economic slowdown has brought some pressure to the hotel industry. While Mainland China hotels welcomed the Spring Festival influx, it also faced numerous challenges.

During the eight-day Spring Festival holiday, compared to the same period in 2024, hotel average daily rate (ADR) saw a slight decrease of 3%, which was anticipated, as the Mainland China market has been under significant pricing pressure over the past year. However, the decline in occupancy might have exceeded expectations, dropping by about 7 percentage points (ppts) year over year to 61%, with the market penetration index (MPI) decreasing to 91. Due to occupancy and ADR decreases, revenue per available room (RevPAR) saw a significant 12% decline compared to the 2024 Spring Festival holiday.

When looking at the hotel classes, mid-range and economy hotels experienced the smallest decline in ADR, only 2.5%, while luxury hotels had a relatively resilient occupancy, declining by just 3.0%. In contrast, mid- to high-end hotels saw the largest drop in RevPAR, which fell by 18% compared to last year. Overall, lower-tier hotels were less popular during the holiday period, while higher-end hotels performed more steadily.

This year's Spring Festival drove an increase in demand during the second half of the holiday compared to last year. The highest point of occupancy was the same as last year, occurring on the fourth day. On that day, the national occupancy rate reached 76%, although this was a 5 ppt decline compared to last year's peak. During these eight days of the holiday, the occupancy rate in the first half showed a significant gap compared to the same period last year, but starting from the fifth day, daily occupancy surpassed the same period in 2024. Meanwhile, the average room rate also began to exceed last year's levels starting from the fifth day, showing a positive upward trend.

When looking at the market performance across different regions of the country, we observed that, among the 174 STR-defined secondary markets in Mainland China, only 25% of the secondary markets surpassed last year's occupancy levels. 

Rooms rates were slightly better than occupancy, with 30% of the secondary markets seeing their average rate index (ARI) exceed 100. When considering both occupancy and ADR overall, only 28 secondary markets in Mainland China saw RevPAR either match or surpass last year's levels.

Looking at the market performance of tier one cities during the Spring Festival holiday, all except Shenzhen saw a significant decline compared to the same period last year. In Beijing, due to a decrease in demand, RevPAR fell by 18% compared to last year. In Guangzhou, room rates during the holiday dropped 8% – the largest decline in ADR among first-tier cities.

Shenzhen, one of the few markets in Mainland China where both occupancy and ADR showed year-on-year growth, stood out among the underperforming first-tier cities. According to the Shenzhen Culture, Radio, Television, Tourism, and Sports Bureau, during the 2025 Spring Festival holiday, various districts in Shenzhen organized a wide range of cultural and tourism activities. The city received 8.947 million visitors, a year-on-year increase of 8.3%; tourism revenue reached 9.885 billion yuan, a year-on-year growth of 12.5%, marking a "strong start" to the Year of the Snake. At the same time, Shenzhen, as a popular inbound tourism destination, welcomed a large number of visitors from Hong Kong during the Spring Festival, boosting the overall performance of the hotel market.

When looking at key markets and provincial capital cities, most markets performed poorly during the Spring Festival. However, Zhengzhou posted positive performance, with increases in both occupancy and ADR driving RevPAR up 5% compared to last year. In Wuxi, although room rates only increased by 1%, RevPAR still saw a 4% growth due to a boost in occupancy. Other markets generally failed to reach last year's levels. Notably, previously popular cities such as Chongqing, Chengdu, and Xi'an saw double-digit declines in both occupancy and ADR during the Spring Festival holiday, with Xi'an experiencing a significant drop in RevPAR (-25%).

During the holiday, travel hotspots once again shifted to lower-tier markets. In Tangshan, both occupancy and ADR saw double-digit growth, driving the revenue generation index (RGI) to a high of 131, ranking first among the 67 mainland cities monitored by STR. Following closely was Fuzhou, where RevPAR grew 16% year over year. Hohhot also performed well, with RevPAR increasing 10%, while Quanzhou, which saw explosive growth during last year's Spring Festival, maintained similar performance this year, with a slight increase of 0.4% in RevPAR compared to last year.

Hot Markets: Snow and Ice Tourism

During the highly anticipated Spring Festival holiday in the snow and ice tourism markets, Harbin stood out with its unique winter charm, continuing to see improvements in its snow season performance. During the Spring Festival, Harbin’s occupancy peaked at 91%, while ADR reached CNY905. However, compared to last year's booming performance, both of these figures showed a decline, with RevPAR dropping 7.5% compared to the previous year.

Meanwhile, Zhangjiakou also attracted attention during the Spring Festival. Its hotel ADR peaked at CNY1,029 during the holiday, but there was a noticeable decline in room rates later on, leading to a slight decrease in overall ADR compared to last year. Ultimately, RevPAR dropped by 1.9%.

Changchun also made some gains – thanks to an increase in ADR, RevPAR grew by 1.4% year over year. In comparison, Changchun surpassed Zhangjiakou in occupancy, reaching 55%. Despite this, both occupancy and ADR still have room for improvement compared to Harbin.

Winter Island Getaways

Sanya has always been a popular winter getaway during the Spring Festival, and this year, Sanya's market performance saw occupancy levels remain roughly the same as last year. While ADR remained the highest in Mainland China, it experienced a significant decline compared to last year, with the Revenue Generation Index (RGI) at just 86.

There was a noticeable gap in occupancy between mid-range and economy hotels versus high-end hotels during the earlier part of the holiday. In terms of ADR, all hotel categories saw a decrease compared to the same period last year, with high-end and mid-to-high-end hotels experiencing the smallest drop (-2.6%).

Unfortunately, Sanya was unable to drive overall market performance in other parts of Hainan. Haikou saw a significant decline in both occupancy and ADR, with RevPAR falling 32% year over year.

Intangible Cultural Heritage and Folk Culture Tourism

The Spring Festival of the Year of the Snake was the first to be recognized as an "Intangible Cultural Heritage" (ICH) of Humanity by UNESCO and made cultural heritage and folk culture tourism a major highlight. 

Fuzhou saw a 16% year-over-year increase in RevPAR, ranking second among the 67 mainland cities monitored by STR. Quanzhou's performance was largely in line with the same period last year, while Xiamen saw a decline in its hotel room rates, causing its revenue generation index (RGI) to drop.

The Chaoshan region, as the birthplace of the Yingge dance, saw hotel room rates soar to as high as CNY 1,238. Although it gradually declined in the latter part of the holiday, it still drove an overall 10% growth during the holiday festival period, with RevPAR increasing significantly by 16%. This performance led the region to top the STR-defined markets. 

Performance of Popular Overseas Hotel Markets

Among popular outbound destinations, the Japanese market emerged as the biggest winner. Hokkaido, with its unique snow and ice resources, saw a 23% increase in RevPAR, driven by a significant rise in ADR. Osaka, a popular destination for Chinese travelers, experienced a 24% year-over-year increase in ADR. Tokyo followed closely, with RevPAR growing nearly 20%.

Despite negative news about Thailand circulating in China before the Spring Festival, both Bangkok and Phuket still achieved growth in RevPAR, driven by increases in ADR.

Macau saw RevPAR grow 5.6%, maintaining high occupancy levels and steady growth in ADR. Meanwhile, Singapore, Hong Kong, and Seoul all experienced a decline in RevPAR compared to last year's Spring Festival.

During this year’s Chinese New Year, the Mainland China hotel market experienced ups and downs, along with challenges, but also gave rise to new opportunities. Despite the overall market facing pressure, certain cities and regions still performed exceptionally well, injecting vitality into the industry. Snow and ice tourism, as well as intangible cultural heritage tourism, became new growth points, while Japan stood out with particularly strong performance in the overseas market.

Looking ahead, the hotel industry in 2025 will need to adapt to market changes amidst challenges, focusing on inbound and business travel markets, and seeking opportunities.