A new report from CBRE shows while the lifting of restrictions in early June saw an initial bounce in room demand across CBD hotel markets in Australasia, recent developments in certain areas have meant Perth and Brisbane are emerging as better performers, with Auckland’s demand recovery faltering due to a second lockdown.
Quarantine business has been replaced for a weekend getaways in selected CBD hotel markets as the sector experiences shifts in demand against the backdrop of COVID-19, new research has found.
CBRE's CBD Hotel Market Trading report for September 2020 found Key CBD markets across Australia and New Zealand have encountered difficult trading conditions during and after COVID-19 lockdowns, with the absence of material corporate/leisure travel and virtually non-existent international travel supressing room demand across all CBD markets.
According to data from the firm, quarantine hotel business for returning citizens provided initial support over Q2 2020 as Australia and New Zealand went into lockdown, while lifting of restrictions in early June saw an initial bounce in room demand across all markets.
CBRE Hotels CBD Hotel Market Trading Report - At a glance:
Rolling weekly change in room nights sold from the previous year. Source: CBRE
But CBRE Hotels Managing Director Michael Simpson said recent developments in some markets have seen mixed results with Perth and Brisbane emerging as the better performers in Australia, while across the Tasman, Auckland’s demand recovery faltered due to a second lockdown.
“Melbourne’s room demand has been impacted by the reintroduction of lockdown restrictions," he said.
"Conversely, Western Australia’s border closures have resulted in captive workers and local tourists staying in Perth over the weekend.
The daily trend of room nights sold in Melbourne. Source: CBRE
"Auckland has benefitted from approximately 40% of its hotel rooms being sold under contract to the government for quarantine purposes; a source of demand that is likely to run through until at least December this year.”
CBRE Hotels Valuations and Advisory Regional Director Troy Craig said said there had been shifting demand patters in markets least affected by local movement restrictions.
The daily trend of room nights sold across Perth. Source: CBRE
"Like the booming drive markets, city getaways are growing in popularity, resulting in these weekend spikes," he said
"The opening of high-profile luxury hotels in our CBDs over the past few years is also driving this trend, providing locals with greater options for an indulgent city getaway.”
Click here to download the report.
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