Demand, prices keep pace

ALAN WOOD
Last updated 05:00 05/03/2014

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Christchurch now has some of the most expensive hotel rooms in the country.

Tourists and visitors are paying a massive 67 per cent more for an overnight stay than they were before the earthquakes, according to a new survey.

Damage from the 2011 earthquakes has significantly reduced the supply of rooms available to visitors and high prices have drawn negative comments from visitors to the city.

Statistics from website-based booking agency Hotels.com show an average price per room night in 2013 of $164, up 6 per cent from the average prices in 2012.

This was ahead of the Wellington room average of $146, up 6 per cent from 2012, the Auckland average of $145, up 5 per cent; and the Dunedin average of $142 a night, up 6 per cent.

In the middle of last year BNZ chief economist Tony Alexander drew attention to the increasing cost of visiting Christchurch, noting the prices for hotels and taxis.

Yesterday Alexander said he did not want to comment further.

Christchurch prices in 2010 before the damaging earthquakes averaged $98 a night, but leapt to $130 in 2011, according to Hotel.com data based on prices paid through its online bookings.

Tourism Industry Association chief executive Martin Snedden said pricing would "probably come down to supply and demand".

Regional guest night figures for Canterbury have been improving according to Statistics New Zealand.

There were 446,000 guest nights in December last year, compared to 435,000 in December 2012.

Snedden noted several hotels had reopened in the last 12 months, increasing room capacity in Christchurch.

"We are not seeing any indications that hotel rates are deterring travellers from visiting Christchurch, but we do expect that the increased competition will start to be reflected in pricing as more accommodation becomes available," Snedden said.

Hotels.com Sydney regional marketing director Katherine Cole said hotels reopening in the quake recovery period had helped Christchurch, but there was increased demand.

The Ibis, Rendezvous and Novotel are among the larger hotels to have reopened in the period since September 2012, adding several hundred rooms.

"Yes, some hotels have come back online but the demand that is there is driving the price up . . . [demand] is definitely bouncing back," she added.

Tourism Industry Association chairman for the hotels sector in Canterbury Bruce Garrett said his data was in line with the Hotels.com prices.

The Christchurch average for 2013 was $159.85 a night up, from $151.89 in 2012.

There had been a good start to 2014 with occupancy with February particularly busy, "but there has been a noticeable change as we head into March, that things have eased off now," Garrett said.

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The number of extra hotel rooms to be added during 2014 would probably be limited, though developer Lilly Cooper did plan an extra 27 rooms with the boutique Hotel Montreal.

There were also some motels being built, and there could be a slight softening in occupancy rates and prices, Garrett said.

Hotels.com bookings data showed a 5 per cent boost in hotel prices paid by international visitors to New Zealand, a stronger increase than the global growth for hotel prices of 3 per cent. The extra $158 million of tourism funding over four years, as announced by the Government in the 2013 Budget, would be helping the sector in Christchurch and other main centres, Hotels.com said.

- BusinessDay

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