While guidelines allowing the conversion of office space into hotel accommodation in Hengqin have the potential to breathe life into vacant towers on the island and provide affordable options, industry insiders call for strict observance of safety standards.
By Tony Lai
Over 1 million sqm
– Estimated gross floor area of existing office units for potential hotel conversion
“The entire building is divided into multiple hotel [operations]. Its location is very good, but there was no management except for self-service check-in,” a user wrote about their recent accommodation experience in June on Trip.com, one of the major platforms for booking travel services.
“[One of the two elevators] had a power outage and dropped from the 22nd floor to the 5th floor. When I reported this incident to customer service on WeChat,” the user continued, referring to WeChat as the popular social media platform in Mainland China, “they acted as if nothing had happened.”
The user’s accommodation experience took place at a hotel in the Guangdong-Macau In-depth Cooperation Zone in Hengqin, within an office tower, where several other hotels and inns operated by different parties are also situated. Such a situation is expected to become more commonplace in the future due to new policy directives, but this trend also necessitates heightened supervision from authorities to ensure the safety and well-being of the guests, observers say.
Following the recent relaxation of the visa policy between Macau and Hengqin, specifically the introduction of a multiple-entry visa for mainlanders participating in package tours between the two places, the authorities of the cooperation zone formulated the Operational Guidelines for Temporary Use of Existing Commercial Office Buildings as Hotels in late April.
The guidelines, drafted by several departments of the Hengqin authorities, provide a detailed mechanism for converting existing vacant commercial and office buildings into hotels for a period of eight years. According to the official document, the works for the conversion must obtain construction permits from the Urban Planning and Construction Bureau of the cooperation zone before the special industry license for the hotel industry is issued by the Public Security Bureau. The Commercial Services Bureau and Economic Development Bureau will also assist in the process.
9,227
– No of guest rooms at non-starred hotels in Hengqin
Facilitating exchanges
The Hengqin authorities explained that this new measure was formulated in response to the increasing hotel demand in Hengqin in light of the introduction of the multiple-entry visa between Macau and Hengqin. It is expected that more mainland tourists will visit Macau during the day and spend the night in the cooperation zone as part of package tours.
“These can make better use of existing commercial office buildings (…) further promote the diversified development of Hengqin’s hotel industry, facilitate the exchange of tourists between Macau and Hengqin, and strengthen the integration between the two places,” remarked the Hengqin authorities.
According to the latest official data, there were 31 “non-starred hotels” in the cooperation zone, providing a total of 9,227 guest rooms. Meanwhile, the number of tourists at main tourist attractions in Hengqin totaled over 11.63 million last year, averaging 31,863 tourists per day. Across the border, the visitation to Macau reached 14.17 million in the first five months of 2024, averaging 93,214 visitors per day.
“These can make better use of existing commercial office buildings (…) further promote the diversified development of Hengqin’s hotel industry, facilitate the exchange of tourists between Macau and Hengqin, and strengthen the integration between the two places”
Hengqin Cooperation Zone Administrative Committee
Vacant office towers
In addition to well-known hotel brands and standalone hotel towers in mega resorts like Chimelong, Hyatt Regency Hengqin, Hilton Garden Inn Zhuhai Hengqin, Serensia Woods, Angsana Zhuhai Hengqin, and Artyzen Habitat Hengqin Zhuhai, there are other types of accommodation available in the cooperation zone. These include homestays, as well as “inns” or “apartment hotels” that occupy only a few floors of commercial or residential buildings and provide more affordable rates compared to standard hotels.
Property agency Centaline believes that this new policy change will attract more office tower developers to convert their projects in Hengqin. “The key factor is the presence of numerous vacant office towers in Hengqin that have been completed but remain unsold,” remarked a representative from the Hengqin branch of Centaline. “The total gross floor space of these vacant properties exceeds 1 million square metres.”
Furthermore, this could help address the lack of affordable hotel options in the cooperation zone. “While there are numerous four-to-five-star or luxury hotels in Hengqin, there is a shortage of more economical choices particularly for package tour tourists who may have average spending power,” adds the Centaline representative.
But the Centaline representative also highlights that the conversion process may not be straightforward for certain projects. “If developers have already sold some units in their towers, they must obtain consent from the buyers before proceeding with the conversion, which can be time-consuming.” According to the guidelines, the temporary conversion requires approval from the property’s stakeholders in a meeting attended by at least two-thirds of the owners. The consent is only valid if it receives approval from at least 75 percent of the participating owners in the meeting.
“If developers have already sold some units in their towers, they must obtain consent from the buyers before proceeding with the conversion, which can be time-consuming.”
Property agency Centaline
Affordability
Though the guidelines have only been released in recent weeks, hotel operations have already been evident in some office and commercial towers since at least last year. For example, a search on Trip.com revealed the presence of at least five hotels and inns situated in the same office tower at Haoyi Fortune Centre, a mixed-use development spanning 238,000 square metres, which is zoned for offices, flats, and a shopping mall. These hotels and inns, including Zhuhai Dida International Apartment, Hello Hotel Apartment, Meng Apartment, provide between 35 and 105 guest rooms each.
In addition to elevator complaints, some users have also expressed dissatisfaction with the lack of staff and poor hygiene standards at these hotels. “The hotel, located in a commercial building, doesn’t feel secure enough with its passcode lock,” wrote one user about their experience in December 2023. Another user shared their experience in June, stating, “The apartment was extremely small with a sinking wooden floor.”
Despite the concerns expressed by Trip.com users, this type of hotel and inn remains popular among travellers due to its affordability. These converted hotels in Hengqin typically offer room rates ranging from RMB200 (MOP221) to RMB400 on average, while standard hotels start at a minimum of RMB500, according to the hotel industry.
“The biggest concern is, of course, fire safety and staff training in case of emergencies.”
A hotel industry insider
Safety and inspection
“It’s mind-blowing to see that many office buildings near [Hengqin Port] have been converted into hotel rooms floor by floor,” says a hotel industry expert who has visited some of these converted units in Hengqin. “They are nicely decorated, equipped with amenities like a stove, a toilet, and offer fantastic views. The quality is reasonable.”
With the recent guidelines issued by the Hengqin authorities, the industry insider also predicts that there will be even more similar conversions in the future. “Given that the office business is not picking up quick enough, owners [of office buildings] would want to generate an ROI [return on investment] by renting out a few floors [for hotel conversion],” the source explains, adding that the average hotel occupancy rate in Hengqin now stands at about 60-70 percent.
However, the insider, speaking anonymously due to the sensitivity of the topic, raises concerns regarding these conversions. “The biggest concern is, of course, fire safety and staff training in case of emergencies,” the source emphasises. “In places like Macau, hotels are required to strictly comply with fire codes, including conducting fire drills, installing sprinklers in guest rooms, and smoke detectors. But I have not seen any evidence that these measures have been in place in these converted units.”
“There should be regular inspections and specific safety standards in place to ensure the safety of guests,” the industry source asserts.
The recent guidelines mandate that all converted hotels must incorporate essential facilities such as elevators, fire exits, fire stairs, passageways, and comply with the requirements set by the fire department of the cooperation zone. “The fire department will also enhance fire safety inspections of the hotels during their operation,” the guidelines further state.
“Having numerous vacant towers does not contribute positively to the image of Hengqin”
A travel industry representative
Win-win
Another source within the travel industry believes that the recent guidelines establish clearer rules and regulations for this type of conversion. “We have noticed there are hotels operating within office towers in Hengqin prior to the publication of the guidelines,” the source reveals while speaking anonymously.
“It’s not surprising, considering the current oversupply of office spaces. Having numerous vacant towers does not contribute positively to the image of Hengqin,” the source adds. “The current situation could be a win-win scenario for both the authorities and the developers of these office units.”
“While the authorities describe this plan as a temporary conversion for a period of eight years, there is a possibility that it could become a permanent conversion depending on the development of the business environment in the cooperation zone,” the source concludes.
