Hotel room rates, occupancy flagged to fall in 2019

Perth’s hotels market has been tipped to be one of the weakest in the country in 2019, with average room rates, occupancy and revenue per room all forecast to fall during the next 12 months.

The forecast is part of Colliers International’s annual hotel sector outlook report, which flagged occupancy to fall to 73.2 per cent in 2019, a 1.8 per cent decline on the previous year.

Average room rates have been forecast to drop 1.7 per cent, to $166.80/night, while revenue per room (RevPAR) has been flagged to fall 3.5 per cent to $122.10.

Those figures place Perth as the second-weakest hotels market nationwide, with only Brisbane experiencing lower room rates, occupancy and RevPAR than the WA capital.

Colliers’ report showed Sydney was the strongest hotels market in the nation, with average occupancy of 87.1 per cent, an average room rate of $260.50 and RevPAR of $226.90.

The report said the substantial number of new rooms being delivered in Perth was creating headwinds in the market.

Colliers said it expected 1,501 new hotel rooms to be delivered in 2019, including luxury property the Ritz-Carlton at Elizabeth Quay, a Mantra hotel at 900 Hay Street, and a 488-room hotel at Fragrance Group’s mammoth NV Apartments development on Murray Street.

A separate report from Deloitte Access Economics showed Perth’s hotel stock increased by 7.2 per cent in 2018.

The Deloitte report also forecasted declining occupancy rates in Perth, dipping below 80 per cent this year, falling to less than 70 per cent in 2020.