DevelopmentsNews In Brief

Hotel boom to cash in on pent-up demand

COVID didn't stop the booming development of Australia's hotel sector

Hotel operators around Australia are defying the COVID pandemic to open a raft of new properties catering to the pent-up demand in domestic tourism and the introduction of new international travel bubbles.

Every capital city is undergoing either the construction of new luxury hotels or the refurbishment of existing properties as business prepares for an unprecedented boom when COVID comes under control.

The recent opening of Brisbane’s new five-star Hotel X comes as Queensland’s capital prepares to see the unveiling of at least five more top-of-the-range properties next year.

Melbourne has 23 luxury hotels recently opened or coming onto the market, with 4775 new hotel rooms on offer.

Construction is now underway to convert Adelaide’s former General Post Office building into a new luxury hotel, which will be operated by Marriott International.

In Sydney, a new 47-storey hotel and apartment complex, complete with a rooftop infinity pool overlooking the harbour, is set to be built above a heritage sandstone building at the northern end of Sydney’s central business district.

Michael Johnson, the CEO of Tourism Accommodation Australia, says that while Australia still faces challenging times, “there’s going to be a fair bit of pent up international demand for Australia.

 “It’s always a good thing for any city to get some more high end product.

“It shows that investors are still prepared to invest heavily in the tourism industry and now is the time to certainly be building because the industry will have the product ready for when we are in that bounce-back mode.”

Dean Long, the CEO of the Accommodation Association of Australia, said while COVID has been the hand brake on the hotel business, especially in the Sydney and Melbourne CBDs for more than a year, “when we do get the borders open for international travellers there’s going to be a lot of new product to attract them.”

Private developer Built, and joint venture partner Irongate, have submitted plans for the new 47-storey, six-star Sydney hotel and apartment tower, which is estimated to cost up to $800 million. The tower will be constructed above the joint venture partners’ sandstone building at 52 Phillip Street and will overlook the Botanic Gardens and Sydney Harbour.

The Sydney Morning Herald reports the hotel will comprise 240 hotel rooms and 16 upmarket apartments, a block from Circular Quay.

Under the plans, the developers are seeking to lease the state government-owned 50 Phillip Street for 99 years, and combine it with their neighbouring 14-storey building known as Kusu House to create the new complex.

The developers said there had been strong interest from a number of luxury international hotel brands to operate the six-star hotel and the apartments.

Built already has a presence in the precinct with the nearby redevelopment of the former Department of Education and Lands buildings on Bridge Street and the significant refurbishment works at the Sydney InterContinental Hotel, including restoring the heritage facade.

Announcement of the new hotel tower proposal comes as Sydney is undergoing a hotel development boom, including a new IHG-operated Hotel Indigo slated on top of the City Tattersalls Club in Pitt Street and an A by Adina hotel in George Street by TFE Hotels.

In the depths of the COVID-19 lockdowns Sydney’s CBD hotels were close to 10 per cent occupancy.

Leanne Harwood, managing director, Japan, Australasia & Pacific for IHG Hotels & Resorts, told the Herald that while there was still a long way to go on the way to recovery, it was “an absolute certainty that the hotel industry will bounce back better than ever in the coming years.”

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Grantlee Kieza

Grantlee Kieza OAM has won three Queensland Media Awards, two Australian Sports Commission Awards and has been a finalist for the Walkley and News Awards and for the Harry Gordon Award for Australian sports journalist of the year. In 2019 he received the Medal of the Order of Australia for his writing. You can find more of his writing in our upcoming Accom News print magazine!

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