No More Five Star Australia Hotels

The development of new five star hotels in Australia is looking increasingly unlikely, according to industry experts.

Room rates are not high enough resulting in lower returns, according to Tourism Australia general manager destination development, Craig Davidson.

“The returns just don’t stack up,” he told a conference in Sydney. “We see the majority of new hotels being built in the four star market

which is where the new Sydney Airport hotel will most likely sit.”

Karen Wales, senior vice president research and strategic advisory Jones Lang LaSalle Hotels, agreed that growth would most likely occur

In the lower brackets.

“Most visitors are looking for budget or mid-market accommodation,” she said.

But with even lower room rates, these properties were also difficult to make viable, she added.

Meanwhile, chairman and founder of Anthology Hotels Grant Hunt drew a question mark over the existence of luxury properties in Australia.

“I don’t think that we do luxury in Australia,” he said. “We don’t have the service or the staff.”

(Source: Travel Today, Tuesday 20th December 2011)