Savills Hotels September Quarterly Update › asia-pacific-research › ... · 2018-11-22 ·...
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Month Hotel Number of Rooms Price Per Room September Lime Hotel - QLD 21 $285,714 September Park Regis City Centre - NSW 122 $444,098 September Pullman on the Park - VIC 419 $372,050 August Future Quincy Hotel - VIC 241 $378,423 August Bell City Hotel - VIC 837 $187,575 August Novotel Twin Waters Resort - QLD 361 $245,152 Source: RCA Recent Sales Transactions City Occupancy OCC YTD Growth % ADR ADR YTD Growth % RevPAR RevPAR YTD Growth % Australia 75.1% 0.3% $185.28 1.5% $139.21 1.8% Sydney 83.7% -2.1% $221.12 0.0% $185.07 -2.0% Melbourne 81.9% -0.2% $183.98 1.1% $150.73 1.0% Gold Coast 71.9% 2.8% $197.20 8.4% $141.76 11.4% ACT & Canberra Area 79.0% 2.5% $175.03 1.6% $138.29 4.1% Hobart Area 78.1% -0.3% $174.11 0.9% $136.06 0.6% Cairns Area 82.1% -2.5% $153.31 3.3% $125.89 0.7% Adelaide 78.4% 1.1% $153.76 1.4% $120.49 2.5% Perth 72.3% -1.1% $165.05 -2.3% $119.30 -3.3% Darwin Area 73.4% 0.6% $156.58 -1.2% $114.87 -0.6% Brisbane 71.7% -2.2% $154.87 0.6% $111.11 -1.6% Source: STR Australia and City Hotel Market Operating Performance YTD September 2018 September Quarterly Update Savills Hotels November 2018 Market Performance (YTD September 2018) Australia wide RevPAR increased 1.8% Best RevPAR growth markets: Gold Coast (up 11.4%) ACT & Canberra Area (up 4.1%) Adelaide (up 2.5%) Worst RevPAR performing market: Perth (down 11.4%) Sydney was the top performer nationally (in terms of dollar value of RevPAR), outperforming the next best performing market (Melbourne) by $34 or 23% Sydney Luxury hotels achieved 87.4% occupancy and $347 ADR, contributing to a decline in RevPAR of -0.5% to record $304. Sydney RevPAR still achieves a $26 gap over the Melbourne Luxury hotel market (90.6% occupancy, $307 ADR and $278 RevPAR) Melbourne grows ADR despite a marginal fall in Occupancy resulting in a moderate increase in RevPAR Canberra continues to perform strongly in all market KPI’s supported by room night demand growth Hobart room night demand tracked with increased room supply to maintain market KPI’s Gold Coast market KPI’s remain strong having been buoyed by the Commonwealth Games and represents the 3rd top performing RevPAR market Cairns grows ADR, despite a moderate decline in Occupancy due to a fall in room night demand, resulting in a moderate increase in RevPAR Perth new rooms supply exceeded room night demand growth resulting in a fall across all market KPI’s Adelaide continues its steady growth across all KPI’s Darwin holds occupancy, however ADR falls moderately to record a marginal fall in RevPAR Brisbane new rooms supply exceeded room night demand growth resulting in a fall in Occupancy while ADR grew marginally to record a fall in RevPAR International Visitor Highlights (Y/E June 2018) International Visitors were up 6.2% to 8.36 million International Visitor Nights were up 1.4% to 269.69 million China and India markets achieved double digit growth in both Visitors and Visitor Nights. Of concern is the decline in Visitor Nights for New Zealand, USA, UK and Singapore Domestic Visitor Highlights (Y/E June 2018) Domestic Visitors were up 7.0% to 100.3 million Domestic Visitor Nights were up 7.1% to 362 million Economic Update Australia The Australian economy grew at a rate of 3.4% as a QoQ annual growth rate (corresponding to a rate of 3.0% on a rolling annual basis) RBA cash rate remained at 1.5% in October 2018 Consumer and business sentiment for CBD hotels was the strongest of all non-residential property sectors, according to the latest NAB Quarterly Australian Commercial Property Survey, on the back of further projected falls to the already low AUD, which is likely to drive international tourist numbers up considerably The World Global economic conditions remain strong in H1 2018 with this momentum expected to continue throughout 2018, with global growth projected to reach 3.9% in H2 2018 and 2019 Growth projections have been revised down for the Euro area, Japan and the UK whilst growth projections for emerging markets and developing economies are also uneven amid rising oil prices, higher yields in the US, Brexit uncertainty and escalating trade tensions Capital Markets – Australia Just when we thought hotel yield compression was slowing, a number of recent sales has shown yields have fallen sharply. For the rolling 12 months to Sept 2018 the median passing yield is now sub 5.5% compared to nearly 7% for the same period last year The main reason for the sharp fall is buying opportunities have arisen in counter cyclical locations with buyer’s expectation of future income growth. Assets remain tightly held and purchasers need to adopt long term investment fundamentals to secure assets For the YTD Sept 2018, sales volumes of hotels in excess of $5m have now just surpassed A$1bn. We anticipate this to reach A$1.5bn by the calendar year end, which is below 2017 levels and the lowest level of activity since 2011. The lack of opportunities has only led to further yield compression and an increase in competitive tension for the right asset in the right location Executive Summary – Australia
Transcript of Savills Hotels September Quarterly Update › asia-pacific-research › ... · 2018-11-22 ·...
Month Hotel Number of Rooms Price Per Room
September Lime Hotel - QLD 21 $285,714
September Park Regis City Centre - NSW 122 $444,098
September Pullman on the Park - VIC 419 $372,050
August Future Quincy Hotel - VIC 241 $378,423
August Bell City Hotel - VIC 837 $187,575
August Novotel Twin Waters Resort - QLD 361 $245,152
Source: RCA
Recent Sales Transactions
City Occupancy OCC YTD Growth %
ADR ADR YTD Growth %
RevPAR RevPAR YTD Growth %
Australia 75.1% 0.3% $185.28 1.5% $139.21 1.8%
Sydney 83.7% -2.1% $221.12 0.0% $185.07 -2.0%
Melbourne 81.9% -0.2% $183.98 1.1% $150.73 1.0%
Gold Coast 71.9% 2.8% $197.20 8.4% $141.76 11.4%
ACT & Canberra Area 79.0% 2.5% $175.03 1.6% $138.29 4.1%
Hobart Area 78.1% -0.3% $174.11 0.9% $136.06 0.6%
Cairns Area 82.1% -2.5% $153.31 3.3% $125.89 0.7%
Adelaide 78.4% 1.1% $153.76 1.4% $120.49 2.5%
Perth 72.3% -1.1% $165.05 -2.3% $119.30 -3.3%
Darwin Area 73.4% 0.6% $156.58 -1.2% $114.87 -0.6%
Brisbane 71.7% -2.2% $154.87 0.6% $111.11 -1.6%
Source: STR
Australia and City Hotel Market Operating Performance YTD September 2018
September Quarterly UpdateSavills Hotels
November 2018
Market Performance (YTD September 2018)
� Australia wide RevPAR increased 1.8%
� Best RevPAR growth markets: Gold Coast (up 11.4%) ACT & Canberra Area (up 4.1%) Adelaide (up 2.5%)
� Worst RevPAR performing market: Perth (down 11.4%)
� Sydney was the top performer nationally (in terms of dollar value of RevPAR), outperforming the next best performing market (Melbourne) by $34 or 23%
� Sydney Luxury hotels achieved 87.4% occupancy and $347 ADR, contributing to a decline in RevPAR of -0.5% to record $304. Sydney RevPAR still achieves a $26 gap over the Melbourne Luxury hotel market (90.6% occupancy, $307 ADR and $278 RevPAR)
� Melbourne grows ADR despite a marginal fall in Occupancy resulting in a moderate increase in RevPAR
� Canberra continues to perform strongly in all market KPI’s supported by room night demand growth
� Hobart room night demand tracked with increased room supply to maintain market KPI’s
� Gold Coast market KPI’s remain strong having been buoyed by the Commonwealth Games and represents the 3rd top performing RevPAR market
� Cairns grows ADR, despite a moderate decline in Occupancy due to a fall in room night demand, resulting in a moderate increase in RevPAR
� Perth new rooms supply exceeded room night demand growth resulting in a fall across all market KPI’s
� Adelaide continues its steady growth across all KPI’s
� Darwin holds occupancy, however ADR falls moderately to record a marginal fall in RevPAR
� Brisbane new rooms supply exceeded room night demand growth resulting in a fall in Occupancy while ADR grew marginally to record a fall in RevPAR
International Visitor Highlights (Y/E June 2018)
� International Visitors were up 6.2% to 8.36 million
� International Visitor Nights were up 1.4% to 269.69 million
China and India markets achieved double digit growth in both Visitors and Visitor Nights. Of concern is the decline in Visitor Nights for New Zealand, USA, UK and Singapore
Domestic Visitor Highlights (Y/E June 2018)
� Domestic Visitors were up 7.0% to 100.3 million
� Domestic Visitor Nights were up 7.1% to 362 million
Economic Update Australia
� The Australian economy grew at a rate of 3.4% as a QoQ annual growth rate (corresponding to a rate of 3.0% on a rolling annual basis)
� RBA cash rate remained at 1.5% in October 2018
� Consumer and business sentiment for CBD hotels was the strongest of all non-residential property sectors, according to the latest NAB Quarterly Australian Commercial Property Survey, on the back of further projected falls to the already low AUD, which is likely to drive international tourist numbers up considerably
The World
� Global economic conditions remain strong in H1 2018 with this momentum expected to continue throughout 2018, with global growth projected to reach 3.9% in H2 2018 and 2019
� Growth projections have been revised down for the Euro area, Japan and the UK whilst growth projections for emerging markets and developing economies are also uneven amid rising oil prices, higher yields in the US, Brexit uncertainty and escalating trade tensions
Capital Markets – Australia
� Just when we thought hotel yield compression was slowing, a number of recent sales has shown yields have fallen sharply. For the rolling 12 months to Sept 2018 the median passing yield is now sub 5.5% compared to nearly 7% for the same period last year
� The main reason for the sharp fall is buying opportunities have arisen in counter cyclical locations with buyer’s expectation of future income growth. Assets remain tightly held and purchasers need to adopt long term investment fundamentals to secure assets
� For the YTD Sept 2018, sales volumes of hotels in excess of $5m have now just surpassed A$1bn. We anticipate this to reach A$1.5bn by the calendar year end, which is below 2017 levels and the lowest level of activity since 2011. The lack of opportunities has only led to further yield compression and an increase in competitive tension for the right asset in the right location
Executive Summary – Australia
Share of Total Visitors ('STV')
Total Visitor Nights ('TVN '000)
Total Visitors ('TV '000')
Share of Total Visitor Nights ('STVN') Visitor Nights Annual Growth YOY ('VNAG')
Visitors Annual Growth YOY ('VAG')
VIC
Int'l DomesticTV '000 2,984 24,661 STV 35.7% 24.6%VAG 7.9% 6.4%TVN '000 68,798 71,611 STVN 25.5% 19.8%VNAG 2.1% 7.7%
TAS
Int'l DomesticTV '000 307 2,810 STV 3.7% 2.8%VAG 21.3% 4.0%TVN '000 5,231 11,608 STVN 1.9% 3.2%VNAG 32.5% 3.2%
QLD
Int'l DomesticTV '000 2,737 22,457 STV 32.7% 22.4%VAG 4.1% 4.7%TVN '000 53,838 90,334 STVN 20.0% 25.0%VNAG -0.1% 7.9%
WA
Int'l DomesticTV '000 951 10,222 STV 11.4% 10.2%VAG -1.8% 8.1%TVN '000 26,969 44,347 STVN 10.0% 12.3%VNAG -4.4% 5.8%
ACT
Int'l DomesticTV '000 249 2,701 STV 3.0% 2.7%VAG 12.4% 2.0%TVN '000 5,689 7,148 STVN 2.1% 2.0%VNAG 24.1% 6.6%
NSW
Int'l DomesticTV '000 4,338 32,924 STV 51.9% 32.8%VAG 5.9% 9.3%TVN '000 94,420 103,337 STVN 35.0% 28.5%VNAG 2.1% 6.7%
SA
Int'l DomesticTV '000 464 6,495 STV 5.5% 6.5%VAG 6.6% 5.5%TVN '000 10,604 23,941 STVN 3.9% 6.6%VNAG -3.0% 10.9%
International & Domestic Visitors – Who Goes Where?2 Year Ending June 2018
1 Source: Tourism Research Australia
2 Share of total visitors for both International and Domestic Visitors exceeds 100% due to multiple state visits. Source: Tourism Research Australia
Top 10 International Visitor Markets1 Year Ending June 2018
USA
TV '000 742STV 8.9%VAG 5.0%TVN '000 13,464 STVN 5.0%VNAG -11.1%
India
TV '000 314STV 3.8%VAG 20.5%TVN '000 18,068 STVN 6.7%VNAG 22.8%
UK
TV '000 698STV 8.3%VAG 2.3%TVN '000 22,242 STVN 8.2%VNAG -8.7%
Korea
TV '000 278STV 3.3%VAG 3.4%TVN '000 11,162 STVN 4.1%VNAG -5.6%
China
TV '000 1,312STV 15.7%VAG 13.1%TVN '000 56,894 STVN 21.1%VNAG 10.6%
Singapore
TV '000 379STV 4.5%VAG -1.5%TVN '000 5,526 STVN 2.0%VNAG -15.4%
Japan
TV '000 408STV 4.9%VAG 4.3%TVN '000 10,692 STVN 4.0%VNAG 7.2%
Hong Kong
TV '000 272STV 3.3%VAG 14.3%TVN '000 7,300 STVN 2.7%VNAG -0.4%
New Zealand
TV '000 1,244STV 14.9%VAG 1.2%TVN '000 12,827 STVN 4.8%VNAG -10.9%
Malaysia
TV '000 352STV 4.2%VAG -2.2%TVN '000 8,937 STVN 3.3%VNAG 3.3%
NT
Int'l DomesticTV '000 283 1,428 STV 3.4% 1.4%VAG -7.4% -11.4%TVN '000 3,606 9,644 STVN 1.3% 2.7%VNAG -7.8% 2.3%
Month Hotel Number of Rooms Price Per Room
June Allenby Park Hotel 68 $218,067Source: RCA
Recent Sales Transactions
City Occupancy OCC YTD Growth %
ADR ADR YTD Growth %
RevPAR RevPAR YTD Growth %
New Zealand 79.2% 0.1% $190.92 2.5% $151.18 2.6%
Queenstown 83.6% -0.4% $235.82 9.6% $197.09 9.1%
Auckland 81.7% -1.2% $205.83 0.8% $168.19 -0.4%
Wellington 77.4% -0.3% $177.45 -2.6% $137.36 -2.9%
Christchurch 76.0% 3.7% $149.81 0.7% $113.84 4.4%
Source: STR
New Zealand and City Hotel Market Operating Performance YTD September 2018
Market Performance (YTD September 2018)
� New Zealand wide RevPAR increased 2.6%
� Best RevPAR growth markets: Queenstown (up 9.1%)
Christchurch (up 4.4%)
� Worst RevPAR performing market
Wellington (down 2.9%)
� Queenstown was the top performer nationally (in terms of dollar value of RevPAR), outperforming the next best performing market (Auckland) by $29
International Visitor Highlights (Y/E September 2018)
� International Visitors were up 3.6% to 3.8 million
� International Visitor Nights were up 3.3% to 17.5 million
� Of the top 10 international visitor markets, Australia made up 38.7% of the total share of visitors, with China following at 11.9%
� China and India displayed strong double digit growth in Visitors, whilst Australian Visitor numbers were static
Domestic Visitor Highlights (Y/E May 2018)(3)
� Domestic Visitor Nights were up 2.1% to 22.5 million
� Domestic Visitor Nights to the North Island were up 1.5%, while domestic visitor nights to the South Island were up 3.4%
Economic Update New Zealand
� Economic growth is projected to continue at 3% in 2018 and 2019, largely driven by booming tourism, strong net inward migration, solid construction activity and supportive monetary policy
� The official RBNZ cash rate remained the same at 1.75% in October 2018
Executive Summary – New Zealand
Share of Total Visitors ('STV')
Total Visitor Nights ('TVN '000)
Total Visitors ('TV '000')
Share of Total Visitor Nights ('STVN')
Visitor Nights Annual Growth YOY ('VNAG')
Visitors Annual Growth YOY ('VAG')
North Island
Int'l DomesticTVN '000 8,539 14,915STVN 48.7% 66.2%VNAG 0.6% 1.5%
South Island
Int'l DomesticTVN '000 8,999 7,605STVN 51.3% 33.8%VNAG 6.1% 3.4%
International & Domestic Visitors – Who Goes Where?2 Year Ending September 2018
1 Source: Stats NZ International Visitor Arrivals to New Zealand
2 Source: Stats NZ Accommodation Survey
Top 10 International Visitor Markets to New Zealand 1 Year Ending September 2018
USA
TV '000 341STV 8.9%VAG 6.7%
Korea
TV '000 92STV 2.4%VAG 7.4%
Canada
TV '000 69STV 1.8%VAG 6.0%
UK Germany
TV '000 233STV 6.1%VAG -5.1%
TV '000 101STV 2.7%VAG -2.6%
Australia
TV '000 1,474STV 38.7%VAG 0.5%
Singapore
TV '000 61STV 1.6%VAG 5.8%
Japan
TV '000 101STV 2.7%VAG -0.2%
China
TV '000 453STV 11.9%VAG 11.1%
Michael SimpsonManaging Director +61 (0) 431 649 [email protected]
Contact Us – savills.com.au
Vasso Zographou Director +61 (0) 449 979 [email protected]
Adrian ArcherDirector +61 (0) 481 037 [email protected]
Tom Shadbolt Associate +61 (0) 423 381 563 [email protected]
Lucy O’Keefe Rydge Executive Assistant+61 (0) 431 81 9 [email protected]
Kayla Fishburn Administration Assistant+61 (0) 438 437 [email protected]
Max Cooper Director +61 (0) 431 776 167 [email protected]
Rob Williamson Director +61 (0) 412 803 482 [email protected]
James Cassidy Associate Director +61 (0) 478 333 [email protected]
India
TV '000 69STV 1.8%VAG 18.6%
