Bushfires and associated smoke haze played a part in keeping travellers away from Sydney in January.
Bushfires and associated smoke haze played a part in keeping travellers away from Sydney in January.

Indications on just how hard of a hit Sydney’s hotel industry is preparing to take from bushfires and Coronavirus are beginning to emerge, with STR preliminary figures for January signalling alarm bells may be sounding in the near future.

In an update issued today, the hotel industry’s data and analyst think-tank shows new hotel supply in the NSW capital steaming ahead while demand, sales and occupancy suffer setbacks from national and international disasters.

For the month of January, supply increased 1.7% while demand slipped 3.2% compared to the same month last year. Occupancies fell 4.9%, with barely three in every four hotel rooms occupied over the course of the month. Average Daily Rate fell 2.1% to $206.42 while RevPAR took the biggest hit, sliding 6.8% to $156.18.

The ongoing momentum with new hotel supply saw January 2020 become the 25th consecutive month of occupancy declines for the market. Events such as bushfires saw no new demand generates over the same period, while demand growth is being exacerbated by uncertainties surrounding Coronavirus as arrivals from China are stonewalled.

L-R Dean Long, AAoA and Michael Johnson, TAA

Accommodation Association CEO, Dean Long, said global events led to a poor month for Sydney’s hotels.

“The continued impact on visitation remains a major concern for industry with China our largest international visitor market, providing 23.2% of international visitor nights and the impact also being evidenced in other international markets choosing to curtail international travel.”

Tourism Accommodation Australia CEO, Michael Johnson, said he saw the downturns as directly linked to the bushfires at the start of the month, followed by the impact of Chinese arrivals drying up.

“The federal government recovery package will assist both regions and the gateway, however more funds will be needed to counteract the gateway cities Coronavirus cancellations.“