Hotel investors are keeping a careful eye on Sydney as the city's hospitality scene keeps gaining momentum. JLL Hotels & Hospitality Group chief executive, Australasia, Craig Collins told the Sydney Morning Herald that Sydney hotel rooms see greatest demand Monday to Thursday, and that this should increase once Barangaroo and the International Convention Centre are completed.
"Whilst some new hotels will come online, they will largely service market growth and/or replace the few hotels that are expected to close for redevelopment," Collins told the paper. "It's no coincidence these trading conditions have corresponded with one of the most active periods the Sydney hotel investment market has ever experienced, with the sale of The Westin Sydney, Hilton Sydney, Sofitel Wentworth, Sheraton on the Park and Four Seasons Hotel Sydney all taking place in the span of a little over two years.
"Global investors now perceive Sydney the same way they do Paris, New York, London and Hong Kong. They see Sydney as having excellent fundamentals and a very positive growth outlook."
JLL Hotels & Hospitality Group senior vice president Peter Harper said the Sydney Airport hotel precinct was also growing and was positioned to capture demand from the domestic and international airport. The sites include the Holiday Inn at Sydney Airport. "The airport precinct has a dynamic, diverse and growing demand base. It services Australia's busiest airport, which catered to around 38.5 million passengers in 2014 and is forecast to receive around 74.3 million passengers annually by 2033," Harper said.
Rising room rates and occupancy levels are attracting hotel investors, the story also noted, along with a weaker Australian dollar and growing demand for local hotels.