With the Covid-19 pandemic continuing to impact tourism across the globe, 2021 brought its share of challenges to the New Zealand hotel sector.
With international borders remaining largely closed, the sector continued to rely on domestic demand and Government backed MIQ contracts for a second consecutive year, enjoying a relatively buoyant trading period over H1 2021, further underpinned by a quarantine-free bilateral travel arrangement with Australia.
However, the outbreak of the Delta variant saw the trans-Tasman bubble quickly suspended, with New Zealand subject to another nationwide lockdown. This dampened demand for the latter part of H2 2021 with restrictions eventually lifted as the nation achieved its 90% vaccination target in mid December.
We have since witnessed a robust domestic recovery over the 2021/22 Christmas holiday period, although the Omicron variant again looks set to reduce demand over Q1 02022. The Government has recently announced our international borders will reopen in a staged manner from July, with a wider recovery anticipated to commence from this point.
Despite the impact of the pandemic, New Zealand recorded the highest level of hotel transactions on record in 2021 with in excess of $400 million of hotel deals settled, representing a staggering 33 per cent increase on the previous highs of 2010 and 2015.