Cup loss no loss for hoteliers

By IRENE CHAPPLE

Auckland's hotel occupancy levels have rebounded to the same as last year despite fears that the loss of the America's Cup would bring a drop in numbers.

Although room rates are down, hoteliers are pleased occupancy rates have been maintained in the wake of the Auld Mug's departure.

Lower transtasman airfares and New Zealand's high profile thanks to the Lord of the Rings and Whale Rider euphoria are credited with maintaining the occupancy rates.

Industry estimates put occupancy rates for the year so far at around 83 per cent, compared with 82 per cent last year. The first two weeks of March are sitting in the mid-90s, around the same level as last year.

Yield for the year, however, is down by around 10 per cent.

A report from hotel consultancy Horwath Asia Pacific said New Zealand's hotel profitability was expected to improve over the year.

Contributing factors to a profit upswing included the fact that no new hotels were opening, reduced domestic air fares, Tourism New Zealand's "100 per cent pure" campaign and expected economic growth of 2.9 per cent.

"These factors suggest the potential for a relatively strong uplift in hotel room demand being achieved during a period of relatively static supply," the report said, "which should, in turn, allow increases in room rates."

Sheraton Auckland general manager Greg Maloney said the industry had been "slightly pessimistic" about this year's tourism season given the loss of the Cup.

Hoteliers missing the high-rolling yachties who paid top dollars to secure accommodation were seeing a return to traditional business.

Maloney said the mix of business was now weighted more towards wholesale and group bookings, which were discounted and had pushed hotel income down.

Gordon Wilson, chief operating officer of listed company CDL Hotels, which runs the Millennium, Copthorne and Kingsgate chains, said the industry was simply getting back to normal after an abnormal year.

"Certainly the industry is performing as it should," he said.

"I think what happened in 2003 [was that] traditional business got pushed out and they've come back, and we've been able to maintain occupancy."