Jerry Schwartz “thrilled” with hotel room rate increases
Regions too benefitting as increased rates reflect demand for limited availability
Asked to comment on the Colliers/STR report detailing hotel room rate increases in all capital cities, Dr Jerry Schwartz told AccomNews while as a hotel owner he was thrilled, he also agreed with Accommodation Australia (AA) and Tourism Accommodation Australia (TAA) comments that across the board rising costs were having a major impact on pricing.
Supply chain price increases, fuel and power costs, laundry costs and recently-increased wages are all seen as contributing to the situation, but Dr Schwartz said there are other factors at play.
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The impact, he said, is also being felt in the hidden costs required to operate, such as IT and those costs associated with in the post-COVID era including hygiene, housekeeping and cleaning, which when combined with other factors, has added more reason for hoteliers needing to increase pricing.
“And this also reflects on the value of hotels – building costs have gone up therefore hotel values have gone up as these go up, this means you have to earn more to pay your mortgage,” said.
While the Colliers/STR report focused on capital cities, with the exception of the Gold Coast, where he said business was booming largely due to leisure market demands, Dr Schwartz said regional tourism was also doing extremely well.
“Regional tourism is prolific now, I would think that regional areas rates in NSW have gone up almost as high as the Gold Coast and certainly in the Hunter Valley and Blue Mountains where I have hotels,” he said.
“My hotel in the Hunter Valley (the Crowne Plaza Hunter Valley) has never had as good a year as it’s having now and that’s including before COVID.
“But with everyone wanting to get out and with limited availability, the rates have gone up.”
Dr Schwartz said one of his concentrations during COVID had been to introduce more leisure facilities to his properties.
“I am trying to attract more than my fair share of regional tourism and obviously with good occupancy, you put the rates up,” he said.
Dr Schwartz said he also agreed with comments made by AA CEO, Richard Munro that Australia’s hotel rates continue to sit well below Europe and other countries.
“I’ve always been amazed at how high costs are in Europe,” he said.
“You go to Europe and you pay almost £1.00 for what we pay $1.00 in Australia.
“So it is good that we are catching up – we have the luxury rooms we just don’t have the luxury prices.”
Mike Parker-Brown is a UK-trained and qualified journalist and an award-winning travel communicator with more than 30 years experience.
Since 2002, Mike has worked as a freelance writer and PR consultant providing his services to major organisations in Australia and internationally in the tourism, aviation, hospitality, recruitment and export marketing sectors.
