Australia's east coast attracting global hotel brands

Marriott International has signed The St. Regis Melbourne, marking the first hotel in Australia for the brand. 
Marriott International signed The St. Regis Melbourne in August. Photo credit: Marriott International

Australia is poised to get an influx of new hotels in 2019, particularly along its east coast. 

"Whilst there is some supply coming on in the New Year—remember in Sydney alone there was nothing from 2000 to about 2014—we are playing catch up," Simon McGrath, COO at AccorHotels Pacific, told the Sydney Morning Herald. McGrath noted the opening of the International Convention Centre in Sydney, an increase of sporting events in Melbourne and the new airline routes to regional Australia have increased demand for visitor accommodations. 

Growing Supply

And global hotel companies are responding. Just two weeks ago, IHG opened its first Voco hotel in Australia’s Surfers Paradise. The 389-room Voco Gold Coast is owned by Australian property-investment firm SB&G Group, which inked the deal with IHG in June, coinciding with the global launch of the Voco brand. The Voco Melbourne Central is scheduled for July 2020 and the Voco Yarra Valley is slated to open in 2021. The fourth Voco will be a rebranding of IHG’s Kirkton Park Hotel Hunter Valley in New South Wales.   

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IHG also proposed a $200-million redevelopment of The Walk Arcade in Melbourne that will include a 453-room, dual-branded Holiday Inn and Hotel Indigo when it opens in 2022. Earlier this year, IHG and Watson Elite signed a deal to open the Hotel Indigo Sydney Central in 2021. 

Hilton, meanwhile, announced plans to manage a new-build hotel in Sydney's Parramatta suburb under a management agreement with Ledrae Hotels. The 245-room Hilton Parramatta is slated to open in late 2020. 

Marriott International also has made inroads into the region, signing The St. Regis Melbourne in August as the brand's Australian debut. Earlier this year, Australian developer Grocon announced plans to develop the W Sydney while Greaton Group will fund the construction. The new-build hotel will be part of The Ribbon development designed by architect Hassel when it opens in 2020. That project follows the 61-story, $500-million Ritz-Carlton Sydney in the city's Pyrmont neighborhood, which will have 220 guestrooms along with approximately 200 apartments.  

AccorHotels finished its $1.2-billion acquisition of the Mantra hotel group in May, adding 138 hotels under the the Mantra, Peppers, BreakFree and Art Series brands across the region to its portfolio. When the deal closed, AccorHotels operated more than 330 hotels and resorts across Australia. The company also has opened its first vertical dual-branded hotel, Novotel and ibis Melbourne Central.

Rydges, meanwhile, received approval from the Australian government to develop a $50-million, 192-guestroom hotel in the Gold Coast Airport area.

New Demand

Leanne Harwood, IHG managing director for Australasia and Japan, told the Sydney Morning Herald the new supply was matching demand, both in terms of room numbers and in terms of diversification.  "We see more demand for these hotel styles from the younger guests, while the traditional hotel brands are very popular with older guests," she said.

This matches data tracker CBRE's latest statistics, which reported a 5.2-percent year-over-year increase in visitor arrivals to 9.2 million this past October.