Hard-up moteliers use units as flats

Last updated 13:00 24/10/2012

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Residents are living in motel rooms rather than renting a property as Nelson motels are battling to survive a drop in visitors.

In a new trend several Nelson motel operators confirmed they were offering long-term accommodation to offset reduced visitors, but many were reluctant to comment publicly.

Blue Waters Motel in Tahunanui has stopped operating as a motel and is instead offering long-term accommodation, while a few others are also offering long-term rooms at cheaper rates until summer.

Blue Waters Motel owner Wayne Black said he stopped offering overnight accommodation for guests at the end of February after the Golf Rd motel struggled to make enough money to survive the quieter winter months.

He and wife Fiona put the motel up for sale as they were also looking to leave the hospitality industry, but found they could make a better return renting the one and two-bedroom units to long-term residents. There had been constant demand for the 12 furnished units rented at $200 to $250 a week. They also rented the four-bedroom home that was part of the motel complex.

It made more financial sense to offer long-term accommodation once the extra expenses of running a motel were added - advertising and time spent working in the business.

"The last couple of summers bookings have dropped off and forward bookings were abysmal," Black said.

Four Seasons Motel and Saxton Lodge in Tahunanui are among other motels that this year offered long-term accommodation to tenants in winter - $260 a week and $280 a week respectively. Both offers included utilities, but were only on offer until the end of the year when prices increased to summer rates.

Four Season Motel managers Sascha Schwarze and Michelle Rutherford said demand for the long-term units had exceeded supply, but they were available only until December 15.

"On the first day we advertised them they were all taken and we had a waiting list. It's gone really well because in Nelson, tourism just disappears in winter," Rutherford said.

Most of their units were still used by short-term visitors, but occupancy had been more consistent throughout the year after a few rooms were made available to long-term working residents. For most tenants it was a short-term solution after relocating to the city or until they were able to find something else, Schwarze said.

Tourism figures show the number of guests staying at Nelson motels dropped by 24 per cent in August compared with last year, while all accommodation types dropped 20.4 per cent in the same period. This was in line with a nationwide drop for motels and backpackers.

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Motel Association of New Zealand Nelson branch administration officer John Gilbertson, who owns Arrow Motels on Golf Rd, was reluctant to comment because of concerns it would cause rates to drop even further, when many motels were only just covering expenses in the off-season.

He was aware long-term accommodation was offered by a few motels, but said some had permanent contracts with employers for seasonal workers.

Nelson was known for being a one-season town, meaning sufficient income had to be made in summer to survive a quieter winter, Mr Gilbertson said.

Developer Brent Ennor, who is behind several Nelson motels, said he had never heard of any other motels in New Zealand offering long-term accommodation. Ennor, a Christchurch-based developer, is building a 15-unit motel on the corner of Wainui and Trafalgar streets, due to be finished by the end of this year.

He was unconcerned about building additional motels.

The problem was, for some motels, that travellers these days were unwilling to pay for accommodation unless it was modern, in a central location and with the latest technology. Meeting all of these factors made it harder for many Nelson motels built in the 1960s and 70s, located on the city's fringe, to compete, he said.

Other Nelson moteliers said they took long-term residents in winter, but normally for up to a month only.

- Nelson


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