Sydney hotel rates make biggest jump in 20 years

Sydney hotel occupancies are now higher than in New York, London and Hong Kong because of limited supply, according to Flight Centre data.

Nightly rates in Sydney hotels jumped to an average of $270 in the first quarter, with hotel occupancies averaging at least 90%, according to Flight Centre’s business consulting division, 4th Dimension.

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“Sydney is now one of the highest-occupied accommodation markets in the world,” says Flight Centre Corporate Traveller general manager Jess Anscombe.

Accor chief operating officer Simon McGrath, who controls 35 hotels across the Sydney CBD and metropolitan regions, says rates will continue to be strong across the city.

“We are seeing rate growth in the Sydney market. We put it down to the launch of the International Convention Centre, to the strong inbound business with international arrivals up and a strong domestic traveller, all underpinned by sporting events such as the soccer and the Vivid Festival coming altogether,” McGrath says.

Langham Hospitality Group vice president sales Simon Manning says room rates have jumped 60% over the past 2.5 years following the renovation of his luxury Sydney hotel.

Anscombe said it was often 35-50% cheaper to stay in an airport hotel than a CBD hotel.

“As the No 1 business hub in Australia, travellers need to start booking accommodation as early as they possibly can to avoid being caught in the highest rate ‘buckets’,” she said.

Sydney hotels show the second-highest revenues per available room forecasts of any major city according to Dransfield Hotels & Resorts, with the medium-term forecast of 6.8% growth compared with Cairns with an 8.3% growth forecast. In comparison, Melbourne hotels show a 4.7% revenue per available room forecast for the medium term.

This article originally appeared on www.theaustralian.com.au/property.