New data reveals portion of NZ hotel rooms quarantiners are staying in

Arrest of a man who tried to escape quarantine at the Rydges Hotel in Federal Street. Photo / Jon Smith

New data is out on how many New Zealand hotel rooms are being used by people in quarantine after returning to the country.

Dean Humphries, national director of hotels at Colliers International, said about 6000 hotel rooms were stayed in by quarantiners.

The country was witnessing a significant rise in the number of returning New Zealand citizens and residents, all subject to a 14-day mandatory isolation period in an approved hotel facility.

"This is providing welcomed demand for a growing number of hotels across the country," he said.

By early this month, nearly 40 per cent of Auckland hotel rooms were being used for mandatory isolation, he said. Auckland has 10,400 hotel rooms so about 4000 were for quarantine, he estimated.

In Christchurch, 31 per cent of that city's 3200 rooms are for quarantiners. In Rotorua 20 per cent of the 2000 rooms are being leased for quarantine purposes and in Wellington 3 per cent of the Capital's 4150 rooms are being stayed in by quarantine guests, he estimated.

On top of this largely unanticipated demand, the hotel sector was enjoying other benefits.

Those included an increase in domestic leisure guests over weekends and school holiday periods, special visa entries for international guests, including the Avatar II production crew and America's Cup syndicates, and early recovery of the corporate and meetings, incentives, conferences and exhibitions segments.

"The July school holidays have provided a welcome reprieve to many hotel owners particularly in regions close to major metropolitan areas," Humphries said.

The hotel sector had experienced a challenging second quarter, due to a full nationwide lockdown through much of April and May.

That meant hotel occupancy rates fell to below 20 per cent in all key regions in April, with room rates also falling by up to 50 per cent, he said.

However, since all domestic travel restrictions were lifted in early June, hotel performance has shown a surprisingly strong rebound.

Meanwhile, the hotel sector will soon be flooded with new Auckland rooms. Humphries told the Herald last month the largest number of new hotels built simultaneously in the city at any one time would result in the six opening between August and October.

But who will stay in those approximately 900 new rooms with the global travel lockdown, closed borders, quarantine and flight restrictions?

"It's not disastrous but timing is unfortunate. These were planned years ago but once Covid runs its course in six, 12 or 18 months, demand is going to pick up again," Humphries predicted.

The six hotels due to open shortly are:

• The new-build 194-room Sudima on the Wellesley/Nelson Sts corner by Hind Management;
• The new-build five-star waterfront 190-room $300m Park Hyatt, Halsey St on ex-Team NZ sailing base by China's Fu Wah;
• Travelodge Wynyard, a 154-room property advertising its opening date as October;
• QT Auckland, a 150-room hotel opening in a former Viaduct Harbour office building;
• The 104-room Hotel Britomart near the waterfront by Peter Cooper's Cooper and Company;
• The Mercure Auckland Queen Street, a 96-room hotel spanning eight stories in an existing building.

Humphries said it won't be till 2022 that a seventh huge hotel - the 303-room five-star Horizon between Hobson and Nelson Sts by SkyCity Entertainment Group - is due to open.

"These six new hotels opening soon in Auckland were scheduled to open around the same time as the NZ International Convention Centre, next year's America's Cup and all the events planned for 2021. These were planned two to four years ago or more and that's the reason they're all due to come on stream soon."

The hotels' owners and operators were in the sector for the long term.