Sydney just recorded the highest hotel occupancy for any May on record as developers scramble to take advantage of the city’s tourism boom.
Hotels in Sydney enjoyed a ten percent rise in revenue per available room last month, with a 2.3 percent rise in occupancy to 84.3 percent and a 7.7 percent rise in the average daily rate to put it at $162.
After nearly two decades of weak hotel development, the city’s accommodation stock is forecast to grow nearly 4 per cent in 2018 as several major residential projects convert to include hotels or short-term accommodation.
Last month, Accomnews reported that Meriton Group will turn a near-complete $152 million CBD apartment complex in Sussex Street into a 32-storey hotel in response to demand for more tourism accommodation.
Billbergia has now submitted an application for a $122 million hotel and office building to incorporate the heritage Firehouse Hotel in North Sydney. The 35-storey tower would sit above the 1895-built hotel on Walker Street and include 224 hotel rooms.
Sydney’s stellar market performance for May was helped by a combination of events, including Australian Fashion Week from May 13 to 18 and Vivid Sydney beginning on May 25 for three weeks.
The opening week of Vivid Sydney 2018 coincided with occupancy growth and an average daily room rate increase of around 5 percent when compared with Vivid Sydney 2017.
STR said the preliminary May 2018 data indicated “strong demand and significant performance levels”, with full figures due for release later this month.
Nationwide, Tourism Accommodation Australia data shows 40,204 rooms across 200 hotel projects are in the pipeline until 2025, making it “the most extensive and comprehensive hotel rejuvenation phase in Australia’s tourism history”, according to the body’s chief executive officer Carol Giuseppi.