Steady trading enjoyed by Wellington hoteliers

Steady trading enjoyed by Wellington hoteliers

Wellington hotels enjoyed a year of steady trading in 2012 with corporate, government and conference business returning to normal patterns following Rugby World Cup 2011.

New figures presented at the Tourism Industry Association New Zealand (TIA) Roadshow in Wellington today show that 2012 was a year of gradual stabilisation in occupancy and rates for many TIA Hotel regions.

“After a very eventful 2011 with the Rugby World Cup and the Christchurch earthquake changing visitor flows significantly, 2012 was relatively uneventful. This offered hotels an opportunity to adjust to the new post-GFC business environment of shifts in visitor markets, the increasingly short lead nature of bookings and people remaining very price conscious,” TIA Hotels Sector Manager Rachael Shadbolt says.

TIA Hotels 2012 Annual Operating Survey shows that Wellington’s 24 TIA Hotel members:

· had a 71.6% occupancy rate, down 1 point compared to 2011 (73.6%) and the third highest annual rate of all TIA Hotel members after Christchurch[1] and Auckland. This was above the national TIA Hotels’ occupancy of 69.9%

· achieved the fourth highest average room rate (ARR) of the eight TIA Hotel regions at $141, down $9.00[2] on 2011

· generated over $158 million in revenue from a total of 2983 rooms

· employed more than 1600 people and contributed $108m to the region through wages and salaries, food and beverage purchases, rates and other expenditure.

“The stability of Wellington’s occupancy levels was good to see. As 2011 brought unusual trading patterns, it is realistic to compare rates with 2010, when the ARR was $139 which is on a par with the 2012 rate of $141,” Ms Shadbolt says.

“Wellington continued to enjoy good event business in 2012, including the Rugby Sevens, the New Zealand International Arts Festival and the World of WearableArt which, among other events, were significant drivers of domestic tourism during the year.”

Today’s Roadshow participants are also hearing the views of tourism operators on the development of a National Tourism Plan.

TIA Chief Executive Martin Snedden says tourism is one of New Zealand’s biggest export industries but there is no clear national plan in place to lead the industry forward.

“Tourism has faced rapidly changing trading conditions over the last few years as a result of the global financial crisis, the growing number of visitors from Asian markets and the impact of the Christchurch earthquakes,” Mr Snedden says.

“At the same time, domestic tourism continues to be the mainstay for many tourism businesses and we need to look at how to encourage more New Zealanders to travel around their own country. Never has there been a more important time to focus on where the industry is going and how we are going to get there.”

TIA’s national Roadshow is visiting 10 centres around New Zealand between March and June. It is sponsored by TIA commercial partners Telecom, Westpac and Mercury Energy. Go to www.tianz.org.nz/main/2013TIARegionalRoadshow for dates and venues.

Other highlights from the TIA Hotels Annual Operating Survey 2012:

· TIA Hotel sector members directly employed almost 11,000 permanent and casual staff

· Christchurch achieved the highest annual occupancy of 81.6%, down 3.4 points compared to 2011 (85%). Christchurch continues to be constrained by reduced hotel inventory but hotels are starting to reopen with Ibis Christchurch reopening in late 2012 and the Heritage OGB Building and the Rendezvous set to reopen soon.

· Auckland achieved the second highest annual occupancy rate of 75.6%, followed by Wellington (72.6%) and Rotorua (64.1%)

· The Central Park region (Taupo, Tongariro, Napier and Gisborne) had the highest average room rate of $157, followed by Christchurch ($152) and Wellington ($141)

· The largest individual source of business was independent leisure travellers (45% of all rooms sold, up 5 points compared with 2011), followed by corporate (21%) and tours & groups (17%)

· The largest consumer groups of hotel accommodation in 2012 were New Zealanders (55% of all rooms sold), followed by Australians (16%)

· On average, 39% of bookings were short-term (made up to seven days prior to arrival), 34% were medium-term (8-30 days prior to arrival) and 27% were long-term (more than 30 days prior to arrival).

[1] Two years on from the Christchurch earthquakes, Christchurch hotel stock continues to be constrained. However, year on year data comparisons can now be accurately made as the current trading environment has been through two data cycles. Therefore Christchurch data is included in the 2012 Annual Operating Survey results and is comparable to other TIA Hotel regions.

2 The downward shift of $9.00 in ARR year on year can be attributed to the exceptional changes in business patterns created by Rugby World Cup 2011. Strong demand led to strong event driven room rates in 2011.

TIA Hotel Sector

TIA’s hotel sector represents the interests of over 130 members throughout New Zealand, including international chain, large independent and privately owned hotels. TIA hotel sector members employ 11,000 staff nationally, with annual revenues of more than $866 million.

Note to editors: The Roadshow is not open to the media, but TIA Chief Executive Martin Snedden will be available for interviews following the event.

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