Mixed fortunes for hoteliers
A Christchurch hotel operator is warning would-be developers about a pending glut in visitor accommodation.
Auckland, Wellington and Queenstown hotels are booming, but recent occupancy figures in the Garden City were the lowest for five years, along with the lowest average room rate for a September month since 2010.
The managing director of The George Hotel, Bruce Garrett, echoed recent concerns of consultants at Horwath HTL who said there was a risk of over-building, even in Auckland, where occupancies were more than 80 per cent.
City council-owned Christchurch Airport is delivering record numbers of tourists to Canterbury, but they are bypassing the city and travelling south, often staying briefly at the airport Sudima Hotel, soon to be complemented by a new Novotel close by.
Wellington’s average hotel occupancy rate in September was about 75 per cent. Christchurch hotels were about 66 percent based on Tourism Industry Aotearoa figures, while Statistics NZ put the figure at 62 per cent.
Occupancy rates are reflected in overnight room rates, which have risen in all main centres except Christchurch where post-earthquake rebuilding possibly detracts from the experience tourists seek.
Since 2014 average rates have grown by
$48 in Auckland, $18.50 in Wellington and
$76 in Queenstown. Christchurch rates dropped by $3.70.
Garrett said demand was soft, whereas accommodation providers in places like Methven have told him they have experienced strong growth.
While Christchurch Airport reported annual growth of 10 per cent in passengers, they weren’t showing up in the city, he said.
Statistics NZ figures confirmed the number of visitors to Canterbury was increasing, with a 13.3 per cent rise in nights spent by domestic and international tourists in hotels, motels, backpackers and holiday parks in August. The next highest was in Wanaka.
‘‘With a flurry of new hotels about to come on stream over the next year, I forecast Christchurch hotel occupancies and rates will continue to fall until there is a fundamental shift in visitor patterns.
‘‘They need to see Christchurch is vibrant and attractive destination rather than just a transit hub.
‘‘The 2020 opening of the long-awaited Convention Centre will go some ways towards this, but in the meantime, life is going to be tough for not only hotels but retailers, restaurants, bars, activity operators and everyone that does business with them,’’ Garrett said.
Over the past year Christchurch hotels sold 200 more room nights or just 0.4 per cent. The addition of the 179 room Distinction, with an 8 per cent growth in rooms, saw the rooms sold spread more thinly resulting in a net 5 per cent drop in occupancy, according to Garrett, quoting TIA figures.
New hotels on the way in the next six months included the Novotel airport with 200 rooms, a central city Sudima (88 rooms), CoSa in Colombo (80), and a handful of smaller boutique operations under construction.
City council promotional agency ChristchurchNZ recently commissioned Canterbury researchers to look at international visitors’ perceptions.
A Christchurch NZ spokeswoman highlighted several events for coming months – an event with former WBO heavyweight champion Joseph Parker in December, the Hot Spring T20 Christchurch Black Clash in January, World Busker’s Festival, singer Phil Collins in February, adventure racing GODZone in March 2019, and the Tourism Export Council of New Zealand Tourism Conference, in August 2019.
‘‘With a flurry of new hotels about to come on stream over the next year, I forecast Christchurch hotel occupancies and rates will continue to fall until there is a fundamental shift in visitor patterns.’’ Bruce Garrett, managing director of The George Hotel
The recently redeveloped Distinction Hotel in Cathedral Square.