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Unprecedented events keeps Dunedin hoteliers busy

A year of unprecedented events keeps Dunedin hoteliers busy

A major international sporting event, natural disasters and changes in the way people book travel all had an impact on Dunedin hotels in 2011.

Speaking at NZ Hotel Council’s 2011 Annual Operating Survey presentation in Dunedin this morning, NZHC Executive Officer Rachael Shadbolt said 2011 was an unusual year. Any one of the events 2011 presented to the sector would have had a marked impact, but to have a Rugby World Cup, a series of earthquakes and a significant shift in the way people booked travel take place in the one year was unprecedented.

In 2011 Dunedin’s six NZHC members:
• had a 64% occupancy rate, down 2 points compared to 2010 (66%)
• achieved an average room rate (ARR) of $131.40, up $10.50 on 2010 ($120.90)
• employed over 280 people.

Ms Shadbolt said the Rugby World Cup had an impact on the Dunedin results, with strong market driven room rates achieved during the key RWC game days. These rates helped increase the average room rate for Dunedin in 2011.

“The RWC period brought some challenges for hotels, with significant displacement of traditional September and October business being pushed out to either side of the event. This meant that while good rates were achieved during RWC game days, hotels were very quiet mid-week as traditional corporate and conference business was practically non-existent during that time,” she said.

Greg Hewland, NZHC Dunedin Regional Chair and GM Scenic Hotel Dunedin City, said, “Dunedin hotels enjoyed very strong pre-RWC corporate, conference and event business in August which was up 12 points to 61%. Excluding hotels hosting teams, most other Dunedin hotels experienced similar occupancy levels in September which meant there was no significant occupancy growth over that key RWC month”.

Nationwide, the 2011 annual survey highlighted the significant shift in booking patterns, with more visitors choosing to book at the last minute. This was represented by a 9 point shift to 42% of all NZHC hotel room bookings being made less than eight days prior to arrival. Dunedin sat well below the national average on 28%.

Mr Hewland said over 55% of bookings for Dunedin hotels came in within 30 days of arrival. The Christchurch earthquakes had pushed some corporate business down to Dunedin, with many Christchurch businesses setting up base there. That had affected bookings with corporate travellers keen to ensure they had a roof over their heads.

Ms Shadbolt said that, “At the national level, this data just proves what hoteliers have been saying for the last couple of years. Lead times on corporate and free independent traveller bookings are getting shorter and shorter, particularly as people seek out good deals online”.

Looking ahead to 2012, Mr Hewland said, “Business is tracking relatively well, however there has been a significant decrease in group wholesale business which is a concern for some hotels.
The summer has been softer than anticipated but we remain cautiously optimistic with some good corporate business coming through”.


Other highlights from the NZHC Annual Hotel Operating Survey 2011:
• NZHC members directly employed almost 11,000 permanent and casual staff
• Christchurch achieved the highest annual occupancy of 85%, however this was off a reduced inventory base of 853 rooms compared to 3717 rooms before the February 2011 earthquake
• Excluding Christchurch, Auckland achieved the highest annual occupancy rate of 77.1%, followed by Wellington (73.6%) and Rotorua (64.6%)
• The Central Park region (Taupo, Tongariro, Napier and Gisborne) had the highest average room rate of $160.10, followed by Auckland ($157.60) and Wellington ($150.10)
• The average room rate for 5-star hotels was $217.50, up $39.33 compared to 2010 ($178.70)
• The average room rate for 4.5 star was $148.00, up $15.90 compared to 2010 ($132.10)
• The largest individual source of business was FIT/leisure travellers – 40% of all rooms sold, down 3 points compared to 2010, followed by corporate (23%) and tours & groups (18%).
• The largest consumers of hotel accommodation in 2011 were New Zealanders (54% of all rooms sold), followed by Australians (16%).
• On average, 42% of bookings were short-term (made up to seven days prior to arrival), 33% were medium-term (8-30 days prior to arrival) and 25% were long-term (more than 30 days prior to arrival).

About the New Zealand Hotel Council
• Represents the interests of New Zealand’s international chain, large independent and privately owned hotels around the country.
• Over 118* members, largely in eight tourism centres (Auckland, Rotorua, Central Park, Wellington, Blenheim/Marlborough, Christchurch, Dunedin and Queenstown), account for around 80% of total hotel capacity and close to 100% of ‘large hotel’ inventory.
• Collectively, NZHC members operate over 16,446* hotel rooms, control assets with a capital value in excess of NZ$2.9 billion, generate annual revenue of over NZ$909 million, and employ over 10,500 full and part time staff.
• NZHC runs an Annual Operating Survey across its members each year. The data collected is reported back to each region in a presentation to NZHC members, tourism partners, local government and regional stakeholders.

*NZHC Christchurch member hotels that are closed due to earthquake damage have been excluded from the 2011 Annual Operating Survey analysis.

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