Motels feel pinch

Pat and Bernie Taylor believe the worst has passed. Photo / Janna Dixon

Moteliers fear occupancy rates last month will have done little to reverse the trend of declining guest nights.

Accommodation rates overall are up but hotels account for most of the gains as motels face lacklustre business.

Latest available figures show an increase in total guest nights of 2 per cent in November compared with the same time last year.

And while hotel guest nights rose 6.7 per cent, motels were down 0.7 per cent.

This follows declines in five out of the six previous months for the sector.

Motel operators say hotels have a greater ability to discount and to step up marketing efforts. They also say they face unfair competition from apartment complexes that pay rates and other bills as domestic properties.

"January is the time you really fill up your tank," said Stewart Haynes, owner of the Teal Motor Lodge in Gisborne.

"I have a feeling that perhaps January didn't quite do it for some operators."

Suzi Jones, owner of The Outrigger in Paihia, said the Christmas/New Year period had started well and then the usual mid-January lull came.

"I really thought it would come back again at the end of January and it kind of didn't.

"I've heard horror stories of motel rooms down to $95 or $100, when this is peak season for us."

The issue of commercial versus non-commercial rated accommodation had been around for awhile but had reared its head again with the economic downturn.

Moteliers had been active in lobbying the Far North District Council but had received no relief so far.

"The council definitely knows there's an imbalance there."

Michael Baines, chief executive of the Motel Association, said Wellington City Council was investigating the issue of unit-titled properties applying for a residential rate even though they were used as hotel rooms, on the grounds that they provided long-stay accommodation.

He estimated this saved them $5000 a room a year.

Apartment buildings also did not have the same infrastructure costs - they had a different set of fire regulations and did not have to provide access units for the disabled.

"We've got people offering cheap, nasty, unsafe accommodation and competing with the traditional commercial accommodator. That's really unfair."

He said motels in the main centres had been most affected by competition from hotels and apartments.

Some operators in regional areas were doing well, although moteliers in tourist spots also competed with holiday home websites such as bookabach.co.nz.

Haynes believed the motel industry was lagging behind in using digital marketing tools such as online travel agents and social networking sites.

"Some properties do it and do it very well, but others simply don't."

Travel publisher Jasons Travel Media is due to release details of new online, mobile and print listing and booking tools to support the motel sector.

CEO Matthew Mayne said hotels could not compete with the owner-operator service that motels provided, but getting customers through the door was the trick.

"Digitised accommodation options are not just for the big hotel chains."

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It's still a wonderful life for us

Pat and Bernie Taylor say it's been a tough 12 to 18 months for their Papatoetoe motel The Grange Lodge, but they feel the worst has passed.

"We've got some strong bookings going forward," Pat says.

It's hard to put your finger on the trends at the moment, he says - some of their motelier friends are doing well while others are experiencing their worst patch ever.

The increase in supply of accommodation and discounting has definitely had an effect. "We've seen four-star quality accommodation ... at $75 or $78 a night. That's pretty steep."

Most of The Grange's guests are business travellers, and rather than coming to town for four days they'll come for two, Pat says. Or they'll teleconference.

But owner-operated motels have a distinctly Kiwi flavour and there's no question of their days being numbered, say the Taylors, who mentor people coming into the industry. "We've been here 16 years - we think it's the most wonderful life," Pat says.