Auckland's acute hotel squeeze sees business travellers turn to Airbnb. Photo / 123RF
Auckland's acute hotel squeeze sees business travellers turn to Airbnb. Photo / 123RF
One of the country's biggest corporate travel managers says pressure on Auckland hotels has forced it to use Airbnb for some of its clients.
Orbit Travel said there was growing resistance to paying room rates of up to $700 a night at peak times.
Managing director Paul Rennie said theinflux of overseas tourists meant the no vacancy sign was increasingly being seen for business travellers in Auckland and Wellington in particular.
Over the last year his firm had been booking increased numbers of guests into Airbnbs - entire properties rather than rooms in homes.
Orbit has annual sales of over $500 million with about 900 clients in New Zealand including a big chunk of government business.
Rennie said 8-11 per cent of his clients were now staying in Airbnb properties.
The hotel rates were getting higher because of a growing shortage of supply.
"We've had some that have had to pay $700. That becomes more difficult and Government is not interested in paying anywhere near that. There's elasticity around $240 to $260 a night but when push comes to shove it becomes questionable after that."
While high hotel rates had not stopped businesspeople travelling, their way of doing business was changing.
Orbit Travel managing director Paul Rennie. Photo / Supplied
He said that more corporate clients were travelling to Auckland and returning home that same day rather than staying overnight.
Airbnb country manager for Australia and New Zealand, Sam McDonagh, said the number of business travellers in properties dedicated to the corporate market had trebled in the last year.
About 10 per cent of more than 20,000 listings were for the business market as the hotel squeeze is most felt there. The properties were often more conveniently located than hotels.
Airbnb launched globally in 2008 and last week the company revealed it was set to launch a search tool for business travellers.
The Business Travel Ready search tool would enable professionals to seek out homes and apartments that are business-friendly; including having Wi-Fi, a desk and other amenities that would be offered by a hotel.
Auckland's average hotel room rate to last year was $197 per night, up 9 per cent on the previous year's, according to Hotels.com data.
Average Wellington room rates were up 3 per cent to $175.
Concern over the lack of new hotel development prompted New Zealand Trade and Enterprise to assess the room deficit and to promote New Zealand as a good place to invest as part of "Project Palace." The research focused on Auckland, Rotorua, Wellington, Christchurch and Queenstown and shows that, if demand and supply estimates are borne out, the shortfall in new hotel rooms is expected to be up to 4526 across these centres by 2025, over and above new hotels currently planned.
That is the equivalent of 26 hotels the size of the Sofitel Viaduct in Auckland.
A Deloitte study released last month by Tourism Industry Aotearoa showed more visitor accommodation is the highest priority infrastructure needed to support the future growth of New Zealand's tourism industry.
Short-term visitor arrivals, which include tourists, people visiting family and friends and people travelling for work, reached 3.543 million in the year ended March, up 8.9 per cent from a year earlier, Statistics New Zealand has revealed.
In Auckland, TIA is leading the fight against a proposed council rate on commercial accommodation providers to raise about $28m to pay for the tourism promotion activities of Auckland Tourism, Events and Economic Development.
The agency has previously been funded out of rates but Auckland mayor Phil Goff has argued that the accommodation sector is a direct beneficiary of Ateed's work and it had done well out of the tourism boom over the past few years.
Goff has said the money the city wouldn't have to spend on Ateed could be diverted to spend on infrastructure, particularly transport which benefits tourists as well as residents.
A hotel consultancy firm, Horwath HTL, says uncertainty around the Auckland targeted rate and discussion of a national bed tax was causing uncertainty.
Horwath director Stephen Hamilton said the targeted rate could also discourage developers from building hotels and apartments, and go for instead building residential projects.
Pressures faced by New Zealand's ongoing tourism boom is the subject of the week-long series, The Great Tourism Squeeze, launching in the New Zealand Herald tomorrow.
The series will look at the pressures on some of our most-loved tourism hotspots, as well as canvassing the views of some of the leading figures in the tourism industry.
• Read The Great Tourism Squeeze launching in the New Zealand Herald tomorrow. The week-long series will explore the pressures on some of our most-loved tourism hotspots, as well as canvassing the views of leading industry figures.
