Pandemic pain hurting hotel sector
Providing isolation services softened the pandemic’s blow for some hotels but room income nationally still fell 40 per cent last year.
A Tourism Industry Aotearoa (TIA) survey showed that on average hotels were barely half full in 2020, well down on the 80 per cent average occupancy rates they had previously enjoyed since 2016.
TIA chief executive Chris Roberts said further pain was looming without a trans-Tasman bubble because February and March were traditionally peak time for international travellers.
A lack of major events, which traditionally boosted domestic leisure travel, also contributed to a 40 per cent fall in the average revenue per available room (revpar) to $91.
‘‘At those revenue levels, the majority of hotels which remained open in 2020 were operating at a loss.’’
Roberts said the substantial fall in income was felt across all regions and all hotel categories.
For example, 3-star hotels saw revpar fall from $95 in 2019 to $50 last year and for 5-star hotels it declined from $214 to $96.
‘‘That is not sustainable long term.’’
Regionally, the biggest drop was experienced in Queenstown, where average hotel occupancy halved in 12 months and revpar fell from $207 to $96.
Auckland was the only region to maintain a revpar above $100 but at $103 this was down from $161 in 2019.
Having 32 hotels in Auckland, Rotorua, Wellington and Christchurch providing isolation accommodation for incoming travellers had softened the blow, Roberts said.
‘‘That is 5000-odd hotel rooms . . . if they were removed, the picture would look even bleaker.’’
Only a handful of hotels had remained closed since lockdown and those with their doors open were trying to make the most of custom from holidaying Kiwis.
Roberts said the Government had promised a statement about trans-Tasman travel this month and the tourism industry was hoping that announcement would come reasonably soon,
‘‘If there is a delay to opening the Tasman [border], then some businesses, not just hotels, will have to make hard decisions about whether they close for winter because there simply won’t be enough customers to justify staying open.’’
‘‘Some businesses, not just hotels, will have to make hard decisions.’’
Chris Roberts
TIA chief executive