Brisbane hotel rates soar

Brisbane’s Courier Mail says that Queensland capital city’s newest hotel, the Emporium, has opened as latest research shows strong occupancies are driving room rates higher in the city.

The 106-room five-star boutique hotel in Fortitude Valley adjoins the trendy Emporium shopping and dining precinct and its arrival comes as Australian Bureau of Statistics data shows revenue per available room (revpar) for Brisbane hotels has reached a record high of $108.77, compared with a national average of $86.44.

The hotel market’s biggest earning rooms are in Sydney where revpar is $156.34 and $133.65 in Melbourne.

Colliers International Hotels national director Michael Thomson said room nights sold in Brisbane were up 8.1%  in the first quarter of 2007, adding, “We are now at a point where for certain events and times of the year, demand is exceeding supply.”

“Hoteliers tell us they would like to see more supply – it would lead to more competition but it would also help Brisbane host larger events.”

According to Jones Lang LaSalle research, Brisbane room rates increased 9.8% during the quarter to an average $138.

JLL Hotels research vice-president Karen Wales said the Brisbane market was likely to continue strong growth in revenue per available room in the next five years.

Accor’s Sofitel Brisbane recorded a 13% increase in revpar during the first half of 2007 compared with the same period last year.

And despite the slump in Australia’s inbound market, Accor said its Cairns hotels traded well with solid increases in the domestic market, but overall the Cairns market saw its performance slip 1.4% for the March quarter.

The Gold Coast bounced back from previous oversupply issues to record 74.3% occupancy, its strongest quarterly level in 10 years.

“Mr Thomson said increases in demand in Brisbane had outstripped new supply for the past seven years, but analysts say a wave of new construction is unlikely.

JLL Hotels executive vice-president Troy Craig said the expensive cost of land and construction often made new buildings unviable and Accor Asia Pacific managing director Michael Issenberg said there was still little justification to build new five-star hotels in city centres.

“It must be remembered that rates for five-star hotels in Australia still lag well behind comparable hotels in many European, American and Asian cities,” Mr Issenberg said.

“The era of oversupply that plagued the industry in the first part of the decade has now balanced out and the industry has benefited from a more realistic attitude towards new supply, with the emphasis more on upgrading existing product than building new hotels.”

Report by The Mole