New Zealand is in its 6th consecutive year of a tourism boom which began in 2013 and with limited new hotel supply delivered over this period; it is not surprising that the hotel sector has finally entered a strong development phase.
It is hard to believe we have seen virtually no net addition to the NZ hotel inventory in the past five years, despite almost 1.5 million additional tourists visiting New Zealand. In our gateway city of Auckland for example, we have seen a net addition of 526 rooms added to the hotel stock since 2013.
According to the most recent update of the Colliers New Zealand hotel database(1), there are 2,600 new hotel rooms (22 projects) across our five key markets currently under construction with a further 6,600 rooms across circa 35 projects now proposed or mooted.
Auckland remains the main beneficiary of the current development phase accounting for almost half of all new hotel rooms under construction throughout the country. The completion of the NZICC in late 2019 and the America’s Cup and APEC Summit in 2021 continues to fuel further interest.
Outside of Auckland, development activity is most pronounced in Wellington and Christchurch accounting for 824 rooms under construction. Queenstown, continues to lag with just has three hotels under construction totalling circa 400 rooms.
Fortunately the growing development pipeline across most key centres will now see notable increases in respective hotel inventory over the medium to long term.