Quest Hotels bookings up as call to avoid quarantine guests vindicated

Quest has more than 30 properties across the country. Photo / Supplied

A hotel group which turned down quarantine business says the decision is paying off with occupancy rates on the rise.

Quest Apartment Hotels says despite widespread setbacks their July sales finished just 7 per cent below revenue for the same time last year.

The company's chief executive Stephen Mansfield said throughout the country its 35 properties were 75 per cent full.

''We've never relied on the tourism market - we've never focused on the international market.''

The chain turned down business to operate as isolation hotels for returning New Zealanders.

''When you do the quarantine you take yourself out of the market you've been investing in and you kill your branding,'' said Mansfield.

''Even though it was easy money in the short term we believed in what was best for our business. Our franchisees wholeheartedly supported that - we're seeing the benefits of it now.''

In July the chain bounced back quickly from complete lockdowns and since the Auckland Covid resurgence in August there had been a strong recovery.

''Our current tracking for September also suggests a high degree of resilience in our model and market at level 2.5.''

Quest chief executive Stephen Mansfield. Photo / Supplied

During the level 4 lockdown in April occupancy was running at 40 per cent.

"We actually received bookings from more than 500 new companies across our properties between early May and late June, as well as a further 550 new companies in July and August, paving the way for further strengthening of the brand in the medium to long run.''

However, the impact of Covid-19 on the accommodation and hospitality industry had been significant, because prior to March, the 2020 fiscal year was on track to be a record earning one for Quest.

''We make a 30 year commitment to our sites and you imagine you will have a couple of economic shocks during that time.''

Mansfield said demand for accommodation - predominantly driven from the private sector - would remain strong in the coming year.

"Demand is already ahead of projected budgets for October, and factors such as Air New Zealand recently selling 70,000 flights in a single day with increased capacity across the country provides even more positive signs."

Earlier in the year hotels in the chain got about $2m in rent relief - but also paid $4m in rent.

''We held our own. We were supported not carried.''

While the corporate and Government market is providing support for Quest, figures today from the Ministry of Business Innovation and Employment showed tourism spending dropped across all regions for the year ending August compared to the previous year. It dropped 15 per cent to $25.1 billion.

Auckland, Otago and West Coast experienced the biggest decline, with a 20 per cent drop in annual spend. Northland and Hawke's Bay had the smallest drop in annual tourism spending, down 7 per cent.

Tourism spending in the month of August has seen a decrease in many regions. Auckland has continued seeing the largest fall in tourism spend in August, down 61 per cent to $255m.