"We are watching closely the shifts in market fundamentals in the USA especially," said Pierre Boppe, HSH's chief executive officer.

"The performance of the operations in the first three months is encouraging. However, we remain cautious on the outlook in the face of conflicting economic data and equally varied opinions." 

Year-to-date, flagship The Peninsula Hong Kong averaged 58% occupancy, compared to 53% for the same period in 2000, while the average rate increased to HK$3,004 (HK$2,917). At The Kowloon Hotel the occupancy edged up to 90% (89% in 2000) although room rate rose 12% to HK$532. 

The Peninsula Bangkok's performance was satisfactory with an increase of 52% in average room rate to US$119 - albeit from a low base - and a marginal 2% increase improvement in occupancy to 81%. The Palace Hotel Beijing's occupancy increased by 7% to 58% although the average rate dropped to US$75 from US$81 for the same period last year. The Peninsula Manila, still suffering from the economic and political woes besetting the country, recorded occupancy of 47% compared to 63% a year ago, although the average rate was up 10% at US$109. 

In the United States, New York is the first barometer of sentiment when there are fluctuations in the economy. The Peninsula New York's occupancy decreased to 66% (73% in 2000) but the average rate increased to US$486 (US$462). The Peninsula Beverly Hills managed a better increase in room rate - up 8% to US$420, experiencing only a marginal decline in occupancy of 1% to 88%. Quail Lodge Resort, however, increased both its room rate (5% to US$234) and its occupancy (3% to 55%). 

The Company's property portfolio showed a similar tendency to fluctuate in specific areas. The Repulse Bay unfurnished apartments increased occupancy year-to-date from 81% to 97%, and average yield per net square foot rose 13% to HK$35; occupancy in the serviced apartments dropped from 67% to 64%, and yield declined 8% to HK$22 pnsf. At The Landmark in Ho Chi Minh City, occupancy dropped to 78% from 82%, reflecting the continued economic uncertainties and increased competition within the destination. 

Commercial property improved across the board. Occupancy at The Peninsula Hong Kong's arcade stood at 100%; at The Kowloon Hotel it increased to 91%; The Repulse Bay and The Peak Tower both rose to 82% and 98% respectively. Average yields firmed also. 

Performance in the office space was erratic with The Peninsula Tower dropping 11% in average occupancy to 89%; St John's Building leaping 22% in occupancy to 98%; and The Landmark dropping marginally to 91% from 92%. Yields rose and fell in consequence. 

HOTELS
                                Year-to-Date              Year-to-Date
                                  Occupancy                 Room Rate
                              2001         2000         2001         2000
Owned Hotels
The Peninsula                 58%          53%     HK$ 3,004     HK$ 2,917
The Kowloon Hotel           90%         89%      HK$  532     HK$  473
The Peninsula New York   66%          73%     US$  486     US$  462
Quail Lodge Resort           55%          52%     US$  234     US$  223
The Peninsula Bangkok     81%          79%     US$  119     US$   78

Managed Hotels
The Peninsula Beverly Hills    88%     89%    US$  420     US$  388
The Peninsula Manila            47%     63%     US$  109     US$   99
The Palace Hotel Beijing       58%      51%     US$   75     US$   81
 

PROPERTY
                                Year-to-Date              Year-to-Date
                                  Occupancy          Average Yield (pnsf)
                              2001         2000         2001         2000
Residential
The Repulse Bay                97%          81%     HK$   35     HK$   31
  (Unfurnished)
The Repulse Bay (serviced)  64%          67%     HK$   22     HK$   24
The Landmark                   78%          82%     US$ 1.65     US$ 1.82

Commercial
The Peninsula                 100%          98%     HK$  216     HK$  205
The Kowloon Hotel            91%          86%     HK$   43     HK$   42
The Peninsula New York   100%         100%     US$   43     US$   43
The Repulse Bay                82%          79%     HK$   50     HK$   49
The Peak Tower                 98%          90%     HK$   35     HK$   33

Office
The Peninsula                  89%         100%     HK$   32     HK$   39
St John's Building             98%          76%     HK$   22     HK$   18
The Landmark                   91%          92%     US$ 2.08     US$ 3.20
 

Incorporated in 1866, The Hongkong and Shanghai Hotels, Limited, formerly The Hongkong Hotel Company Limited, was one of the first stocks to be listed on the Hong Kong stock exchange. Its principal business comprises the ownership and management of prestigious hotel, commercial and residential properties in key destinations in Asia, Australia and the USA; its hotel management arm is The Peninsula Group.