Transtasman bubble: Cordis Auckland reports spike in bookings, other hotels say May looking good

Cordis Auckland hotel says the domestic market is not enough to sustain tourism. Photo / Dean Purcell

A leading Auckland hotel says it has had an immediate spike in bookings from Australia since the two-way bubble announcement.

A group representing hotel owners also says bookings are building "nicely" into May and June. Airlines report a surge in transtasman inquiry and bookings but economists say the impact on the wider tourism sector may be limited.

Cordis Auckland says the quarantine-free bubble with Australia, now less than a week away, is a lifeline for the hotel sector and the wider tourism industry in general.

Australians made up to 38 per cent of guests pre-pandemic and the Cordis' managing director Franz Mascarenhas said the booking trend was good.

"We certainly have started to see a spike in individual bookings despite being only a few days since the announcement was made and there is optimism therefore that we will see positive growth in the period ahead," he said.

The 411-room hotel is being expanded with the addition of a 17-level tower next door to be opened later this year.

The Cordis took an early decision not to be part of the Government's managed isolation and quarantine scheme, relying instead on locals.

But Mascarenhas said the past year has clearly proved that the domestic market is inadequate to sustain business, despite a significant amount of competitors' hotel inventory locked away as MIQ facilities.

"When you add the impact of the lockdowns, it becomes clearly evident as to why the industry is so keenly looking forward to welcoming our mates from across the ditch. Hotels do carry significant cost structures and need a minimum level of occupancy to trade profitably," he said.

''Australia has and will continue to be the biggest international source of business for the industry in New Zealand. And that goes across individuals and group travellers."

He said the lack of alternative destinations for Australians would make New Zealand even more attractive.

Queenstown will be a magnet for Australians. Photo / Destination Queenstown

And he hoped people were tiring of virtual meetings.

''I would not underestimate the potential volume that could materialise in NZ as the days of Zoom calls I believe are hopefully over and people very much want the personal touch and the ability to travel and socialise and sign business deals in person.''

There was a backlog of group bookings for conferences which had been postponed during the past year and this could fill a gap during winter, the low season for hotels because of the lack of leisure business.

'''This is where corporate individuals and the meetings and events sector comes to the rescue and this is where Australia is a key source for us to tap into along with the domestic market.''

The success of the bubble was crucial for the Cordis with the opening of the new Pinnacle Tower that will take it to 640 rooms, making it the biggest hotel by room count in the country. Avoiding lockdowns was key to the bubble's success, Mascarenhas said.

Hotel Council Aotearoa says it is not expecting a sudden surge of bookings but were definitely building nicely into May and June.

It expects the first wave of visitors from Australia to stay with friends and family, rather than comprising the leisure and business travellers who stayed at hotels.

Cordis Auckland hotel says the domestic market is not enough to sustain tourism. Photo / Dean Purcell

'''If it snows, Queenstown ski season might be the true test. Folk are optimistic about Aussies coming in droves for the ski season,'' said the council's strategic director, James Doolan.

Accommodation software management business Preno reports a 64 per cent surge in bookings across Australia and New Zealand after the announcement of the bubble last Tuesday.

Preno chief executive Amelia Gain said the Government and the tourism sector would need to be mindful of giving Kiwis the assurance to travel to Australia.

"As there will be state by state nuances in Covid-19 restrictions, it's vital that these are communicated as best as they can to give people the confidence that travel is a possibility, and clearly outlining the considerations to be mindful of," Gain said.

South Island-based tourism business Wayfare wasn't expecting a large number of bookings.

''We expect the first wave of Australians to be visiting family and friends and to follow the same booking behaviour as New Zealanders - which means they'll book at the last minute. We have had some Australian agents make some larger bookings - particularly in Milford Sound,'' said chief executive Stephen England-Hall.

The firm owns big excursion businesses and a ski field, and he said it was gearing up to offer more to New Zealanders and Australians over winter, including overnight cruises in Doubtful Sound and a Kiwi encounter on Stewart Island.

ASB economists say the travel bubble will have limited net impact on the economy, with the possibility of a "small positive".

''However, the bubble may only have limited benefits to the tourism industry. The
bubble is more appropriate for those visiting friends and family, rather than holidaymakers given there is the ongoing possibility of being stranded if there was a community outbreak.''

Because of the relative frequency of outbreaks due to MIQ breaches in both New Zealand and Australia, a short-term pause or suspension of quarantine exempt flights is likely at some point, they say.