Event cancellations to impact hotel demand
As the fallout from the coronavirus crisis spreads, a sudden cancellation of events will have an ongoing negative impact on the hotel sector in Australia.
Sydney and Melbourne had suffered occupancy falls of about 20 per cent in the first week of March, compared with a year ago, according to global research firm STR.
But this pales in comparison to the level of declines seen across Asia and parts of Europe which are currently seeing much higher levels of infection rates.
Average occupancy rates held their ground at about 72 per cent in February. But a series of cancellations or postponements of major events and conferences including Dark Mofo and the Melbourne Grand Prix would have far larger impacts on future hotel performance, according to STR Pacific regional manager Matthew Burke.
Hotel occupancy rates in Melbourne were sitting at 77 per cent this month, but that was before today’s announcement that the Australian Grand Prix would not go ahead.
Cairns has seen the biggest impact with occupancy rates down about 40 per cent, while the Gold Coast and Sunshine Coast were still holding firm, according to Burke.
“Further travel restrictions such as those placed on South Korea will have an impact on these markets,” he told Commercial Real Estate.
Sheridan Randall, 13th March 2020
