Back to normal for hotels in September

New statistics from the Tourism Industry Association New Zealand (TIA) show hotel occupancy increased in many regions last month but room rates were generally lower than in September 2011.

However, anomalies created by RWC 2011 mean it is more realistic to compare September 2012 with September 2010, TIA Chief Executive Martin Snedden says.

When last month’s statistics are compared with September 2010, occupancy is on a par and room rates show good gains.

New Zealand total

 Regional statistics

 Mr Snedden says RWC 2011 had a huge impact on normal patterns of hotel business.

“There was a dramatic decline in traditional September corporate and conference business, replaced by RWC business. However, this varied significantly across regions, with high demand in some centres around match days and periods of soft business between matches,” Mr Snedden says.

“These peaks and troughs resulted in relatively static occupancy levels but increased average daily room rates which were pushed up by high demand from rugby fans around match days.”

Auckland region
RWC 2011 brought significant peaks and troughs to demand, with 1-2 day surges around match days rather than a steady flow of guests throughout the month.

September 2012 occupancy was down 0.8 points to 72% compared to September 2011, and down 0.7 points to September 2010’s 72.7%.

The ADR for September 2012 was down $96.16 to $132.53 compared to September 2011 but up $7.19 against September 2010.

Rotorua region
At 62.1%, September 2012 occupancy was on a par with September 2010 but September 2011 occupancy of 50.8% was well below the normal early-mid 60% level for this time of year. Compared to September 2011, ADR was significantly down by $35.11 to $100.74, but was almost the same as September 2010 ($100.66).

Asia group tour business, particularly from China and South Korea, made strong gains (by share of room nights) after being displaced by RWC 2011, and has shown steady growth since September 2010.

Wellington region
With a rugby test at the start of September and the World of Wearable Art event back in its usual late September/early October time slot, September 2012 shaped up well for Wellington hotels. While the second week of the month was slower than expected, occupancy for the month was up 0.7 points on last year to 74.8% and up 1 point compared to September 2010. 

September last year saw a significant change in normal business activity due to Wellington hosting four RWC games over three weekends. This meant occupancy was maintained at the usual mid-70% September levels but the normal corporate and conference business was replaced with event business, generating higher room rates due to the increased demand over key RWC game dates. As a result, last month’s ADR is not comparable to September 2011, down $53.18 to $148.47 ($201.65, Sept 2011). However, when compared with September 2010, ADR increased $7.17.

Christchurch region
The reopening of the Ibis Christchurch hotel in early September has added 155 rooms to the city’s accommodation inventory and may have partially contributed to the 10.6% decrease in overall occupancy in September 2012 to 75%. ADR also decreased $2.25 to $150.04.

This time last year earthquake related corporate business took up 42% of the room nights in the city. September 2012 results show that corporate business is now 32% (by share of room nights), with Free Independent Travellers (FIT) making good gains, up 17 points to 42%. Tour groups are also up 2 points to 10%. 

Queenstown region
Queenstown hotels were significantly impacted by the change in normal business patterns created by RWC 2011 and the Christchurch earthquakes. September 2012 showed good recovery but fell well short of September 2010.

September 2012 occupancy was 60.2%, up from 48.5% last year but down 11.6% compared to September 2010. Some Queenstown hotels did enjoy good one-off RWC contracts in September 2011 which contributed to the higher than usual ADR of $155.04. As a result, September 2012 ADR shows a large decrease of $16.01 to $139.03 compared to last year but when compared to a normal September, last month was up $10.76 compared to 2010 ($128.27).

The domestic and Australian markets also showed good gains (by share of guest nights) up 11.5 and 8.3 to 47% and 33.4% respectively, indicating there was strong conference and ski business generated out of these two markets last month.

Dunedin region
Dunedin enjoyed good September 2012 results, up 8.2 points to 69.4% compared to the same time last year. Excluding hotels hosting RWC teams, most Dunedin hotels experienced similar occupancy levels in September 2011 to previous Septembers. Three RWC games played in the city in September 2011 boosted ADR to record levels ($158.44), $31.19 higher than September 2012’s ADR of $127.25 which was $9.27 higher than September 2010 ($117.98).

Central Park region (Taupo, Ruapehu, Napier and Gisborne)
Total occupancy for the region in September 2012 was down to 46.9% compared to 49.7% last year. While Central Park was not a big recipient of RWC business, those hotels that hosted RWC visitors and teams helped boost September 2011 ADR to a record $193.64, $42.29 higher than last month’s ADR of $151.35. September 2010 ADR was $139.92.

Nelson/Marlborough region
Nelson/Marlborough had an excellent September 2012 with occupancy up 10.7 points to 49.6%. Part of this increase can be attributed to the negative impact RWC had on the region last year and also strong corporate and conference business. However, ADR was down $24.29 to $124.97 compared to last year but on a par with September 2010 ($123.33). 

TIA Hotel Sector

TIA’s hotel sector represents the interests of over 130 members throughout New Zealand, including international chain, large independent and privately owned hotels. TIA hotel sector members employ 11,000 staff nationally, with annual revenues of more than $866 million.