Hotel Futures 2018 Report

Dransfield last month released their Hotel Futures 2018. A point of interest in there is that ABS has discontinued the Tourist Accommodation series as at FY2016. This was previously an input to the Hotel Futures report. Anyway with funding from Austrade (which is where Tourism Research Australia resides) a replacement Australian Accommodation Monitor series has apparently been outsourced to STR which is to be published later this year.

In the meantime STR have provided data to Dransfield for their report which comes with multiple disclaimers that any republication or re-use of any STR data is naughty. There is useful analysis by Dransfield of differences between the ABS and STR sample. It is pointed out that STR don’t have the ability to compel information providers as the ABS does.

In most cases the STR sample has a higher room rate than the census as it represents the larger, more professional establishments in the relevant geography. In many cases these also have higher occupancy. From the perspective of the majority of readers of Hotel Futures, we think this STR data is more relevant because it is more representative of the investment class hotel assets that our readership is interested in.

Anyway there is good general commentary and analysis of what this all means for Cairns and Port Douglas in the report so will restrict this post to the city outlook summary:

Material development activity is planned, although focussed on Cairns. It is expected to be absorbed despite a minor downgrade in the demand growth outlook. Long term RevPAR expectations are for 3.4% growth p.a., an upgrade on prior expectations driven by short term outperformance.

The long term RevPAR forecast there to FY2026 comes in just below the national forecast for Australia at 4% growth. We will await the Australian Accommodation Monitor from Austrade TRA.

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