While a surge of new openings has dampened sector revenues, Australia's hotels are still amongst the best-performing assets globally, according to a study by STR.
For the first seven months of the year, hotels in Australia and Oceania region achieved the second-highest occupancy rate at 73.4%, trailing closely behind Northern Europe's 74.1%.
Furthermore, despite the Australian dollar falling substantially against the US dollar, the average daily room rate in the region hit US$137 a night. In this category, the region ranked fourth, behind the Caribbean, the Middle East, and Southern Europe.
Also read: Aussie Commercial Market Outpaces Japan, China
In terms of revenue per available room (RevPAR), Australian hotels averaged $101, ranking second to the Caribbean region, which recorded a better rate at $160.
A separate report by CBRE Hotels indicated that local hotels were benefitting from the weaker Australian dollar. This made local hotels more attractive to international travellers looking for bargain destinations, said CBRE associate director of research Ben Martin-Henry.
"A weaker AUD will continue to support growth in international visitors and the amount they spend in Australia, while also encouraging Australians to travel domestically rather than internationally due to stronger purchasing power at home," he told The Australian Financial Review.
The apparent slowing in the hotel scene in Australia is expected to continue. In fact, a recent JLL report project the value of major hotel sales to hit $1.5bn this year, which is below historical averages.
However, Australian hotels are still considered competitive, said JLL Hotels & Hospitality Group executive Peter Harper.
"Despite the lack of sale offerings, the demand from investors is still strong with offshore groups continuing their historical focus on the market, while domestic groups have increased their activity," he told the AFR.
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