AUSTRALIA’S major hotel markets are on a positive growth trajectory, with hotel occupancies and room rates on the rise. Refurbishment has also picked up pace, especially among upscale properties.
With the exception of Melbourne, there has been minimal supply addition in key markets over the past two years, but strong recovery in corporate domestic and leisure inbound travel.
Average room rates in Sydney are forecast to rise to A$210 (US$221) and to just under A$200 in Melbourne by end-2014.
Craig Collins, CEO Australasia, Jones Lang LaSalle Hotels, said the major CBD markets were maintaining strong year-to-date occupancy levels, with Sydney (85.8 per cent), Perth (83.2 per cent), Melbourne (80.5 per cent), Brisbane (78.3 per cent) and Adelaide (73.9 per cent) experiencing strong demand.
He said: “A number of Australia’s major CBD markets are trading at near full capacity and hotel operators are capitalising on these strong occupancy platforms. Continuing supply constraints across the key CBD markets combined with already strong occupancy levels will see room rates continue to grow over the short to medium term.
“In terms of RevPAR growth, Sydney, Melbourne and Brisbane have all posted strong gains of between five and seven per cent, with Perth posting a staggering 13.4 per cent increase.”
Meanwhile, five-star hotels in key markets, including the Four Seasons Sydney, Sydney Harbour Marriott, Park Hyatt Sydney, Melbourne Marriott, Westin Melbourne, Sofitel Brisbane, Brisbane Marriott and Hyatt Regency Perth, have spent over A$500 million upgrading rooms and technology, restaurants, bars and conference facilities over the past year.
Collins said: “We have witnessed a significant increase in refurbishment activity across Sydney, Melbourne, Brisbane and Perth. This is most prevalent in the five-star segment, with about 40 per cent of hotels in these major markets having recently undergone or planning improvement works.”