Wave of hotel plans to change city
Perth's overheated hotel market is set to be transformed by a new wave of developments as investors look to cash in on Australia's most lucrative accommodation destination.
Four major hotel development applications have been lodged with the City of Perth in the past three months, including a $280 million proposal by Singaporean luxury chain Amara Hotels Group to build a 33-storey, 250-room hotel on Adelaide Terrace.
In demand: Perth is short of hotel rooms.
The council has also had development applications from the Intercontinental Hotels Group for a $35 million, 224-room Holiday Inn Express and a $22.5 million, 200-room hotel from an Australian-based company, also on Adelaide Terrace.
In January, local developers Old Perth Port lodged an application for an 11-storey, 230-room, high-end hotel at Barrack Square. It is awaiting Metropolitan Redevelopment Authority approval.
These projects would eventually bring more than 900 much-needed hotel rooms to the Perth market.
State Government modelling indicates an extra 1900 rooms will be needed by 2020. With the exception of the 230-room Fraser Suites serviced apartments and the 15-room Terrace Hotel, which both opened last year, there have been no new hotels in Perth since 2006.
Colliers International director of institutional and investment services Wayne Lawrence said the developments would change the face of Perth.
He said there had been a jump in investment in the Perth hotel market in the past year and though high occupancy rates and soaring room prices had been the norm for several years, investors were acting now because of new incentives and policies.
"The State Government's incentives for hotel developments in the past year and encouragement by the City of Perth along the same lines have added further appeal for hotel operators," Mr Lawrence said. "Along with the opportunities offered by Elizabeth Quay and Perth City Link, they will transform the face of the city."
According to Colliers International's latest report on Australian hotel investment, Perth recorded the biggest increase in revenue per average room of all Australian cities, jumping 18.3 per cent last year. Brisbane, the second strongest, grew 8.8 per cent.
Perth also recorded the highest occupancy rate across the country at 85.6 per cent last year.
Tourism Council of WA chief executive Evan Hall said occupancy rates of more than 80 per cent were considered "full capacity".
He said the hotel shortage in Perth would get worse before it got better with the new hotels unlikely to open for another three to four years. Mr Hall also noted that development applications did not equate to hotels built.
Source: The West Australian, 4 April 2013
