The first quarter of this year has seen a dramatic drop in hotel returns in both Sydney and Perth, according to new figures from hotel researchers STR.
In Sydney, revenue per available room (revPAR) fell 5.6 per cent over the year to March, with asking rates dropping from $244 to $232 a night despite very little new supply.
A wave of new hotel openings in Perth combined with a weaker market has seen a revPAR fall of 7.2 per cent with asking rates slipping to $160 night. Occupancy rates have also slumped to 72 per cent from 76 per cent a year ago.
Melbourne’s hotel market held firm despite absorbing a glut of new supply, assisted by a strong calendar of events including the Australian Open in January and Grand Prix in March. The city maintained high occupancy rates above 84 per cent, which lifted average daily rates above $200 a night.
The figures also showed Brisbane and Adelaide have proved more resilient than both Sydney and Perth, while Queensland coastal markets such as the Whitsundays and Port Douglas were buoyed by stronger growth in prices paid by overseas guests.