Property editor of the NZ Herald

Demand fuels hotel plans

Projects driven by rise in occupancy to highest level since 2004, says consultancy firm.

The Copthorne Harbourcity hotel on Quay St is due to be turned into the Millennium in 2015. Photo / APN
The Copthorne Harbourcity hotel on Quay St is due to be turned into the Millennium in 2015. Photo / APN

Four new Auckland hotels are planned, three of which are office building conversions.

Consulting business Horwath HTL said the city could get an extra 570 hotel rooms because demand and room rates were up.

Waterfront Auckland has called for expressions of interest in building a hotel in the Wynyard Quarter area, an office block near the Britomart was being converted, a mid-scale hotel was planned behind the ANZ Centre and another was planned on Queen St.

"This new supply has been driven by the rise in average annual occupancy for major hotels (members of the Tourism Industry Association) in the last three years which has risen to 76 per cent for the 12 months to March 31, the highest level since 2004, led by above-average occupancy in 4.5 to five-star hotels," Horwath said.

Five-star hotels were the stand-out performers in Auckland in the last three years and room rates of an average $183, up $32 or 21 per cent on the level of 10 years ago.

"Work has begun on the conversion of the Reserve Bank building on Customs St East," Horwath said of the property owned by interests associated with CP Group. That would become a five-star-plus 130-room hotel, opening next year opposite the Britomart precinct and would "set a new standard for upper scale hotels in Auckland as the Hilton Auckland did when it opened 10 years ago".

The key opportunities for Auckland hotels included increasing the rates for 4.5-star rooms and developing the upper-market visitor segment as they seem prepared to pay higher room rates, Horwath said.

NZX-listed Millennium & Copthorne Hotels also has plans to turn the Copthorne Hotel Auckland Harbourcity on the waterfront into a five-star Millennium in 2015, which managing director B.K. Chiu announced at the company's annual meeting last month.

On March 7, Waterfront Auckland said it wanted to form investment partnerships for Wynyard Quarter offices, residential units and a five-star waterfront hotel.

"Comprising around 150,000sq m of gross floor area - approximately 50,000sq m commercial use and 100,000sq m residential - Wynyard Central includes office space focused on a commercial innovation hub and residential use and international hotel site," said chief executive John Dalzell.

Redevelopment of the Reserve Bank building has been discussed for some time. Five years ago, Accor announced a new $100 million 290-room five-star Pullman hotel would be built there. Nothing happened and now the building has been extensively tagged, particularly on upper exterior levels and glass.

The Reserve Bank sold the 1978 building for $6 million in 2001 to Auckland Institute of Studies at St Helens, which had been a tenant.

Horwath said a 100-room hotel was planned behind the ANZ on Albert St.

Hotel moves

*Reserve Bank building to be refitted.
*New five-star Wynyard Quarter hotel planned.
*Mid-scale conversion near ANZ Centre.
*Conversion on Queen St.
*Copthorne to become Millennium.

Sources: Horwath HTL, Millennium & Copthorne Hotels

- NZ Herald

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