Christchurch's earthquakes have devastated the hotel sector there and about half the shut hotels will be demolished, Humphries said.
"As a result of the February earthquake, Jones Lang LaSalle Hotels estimates that two-thirds of the city's hotel stock - 18 hotels or some 2600 rooms - are currently closed due to damage or demolition. This represents a reduction of 12 per cent of New Zealand's total hotel capacity. We understand that since the earthquake, only one of the 18 hotels in the cordoned area has opened, bringing 53 rooms back into the market.
"It is likely that at least 50 per cent of the 18 hotels currently closed will be demolished, including the Crowne Plaza, Hotel Grand Chancellor, Copthorne Hotel Durham St, Copthorne Hotel Central and the Latimer Hotel. The remaining hotels are not likely to reopen until the latter part of 2012.
"While the earthquakes have added a degree of uncertainty to the Canterbury region, we expect that new hotel development will occur in Christchurch itself or within the wider region over the next few years, assuming the tourism market returns to long-term trends," said Humphries who is heading an international marketing campaign to sell Auckland's five-star Hilton.
Hotel sales had been strong this year and that looked to continue.
"The investment market in New Zealand is showing further signs of recovery. The fourth quarter of 2010 witnessed a significant turnaround in investment activity with a plethora of hotel sales.
"Sales included the Hyatt Regency Auckland [now Pullman], Hotel SO Christchurch [now All Seasons Cashel St], and the TAHL New Zealand Portfolio including the Novotel/Ibis Ellerslie Auckland, Novotel Wellington, Ibis Wellington, Ibis Christchurch and Novotel Queenstown.
"The market has rebounded strongly in the second half of 2011 with the sale of the InterContinental Hotel Wellington and Grand Mercure Century City Apartments in Wellington and the Novotel/Ibis and Rydges Hotels in Rotorua.
"Transactional activity at the end of October totals approximately $134 million. We anticipate final transaction volumes for the year to be below that of 2010 but still well above the long-term average," Humphries said.
Tourists' behaviour and demand for hotels outside main centres appeared to have changed.
"While the main cities that hosted RWC matches have experienced strong trading year to date, the mainly leisure markets of Rotorua and Queenstown appear to have suffered as the more traditional inbound visitors may have deferred their travel plans.
The Christchurch earthquakes seemed to have had a impact on the Queenstown market as some international visitors appeared to be avoiding the South Island and focusing their travel in the North Island.
