While it will take some time to return to pre-pandemic highs when tourism was New Zealand’s number one export earner, key indicators are encouraging.
People are genuinely interested in what’s happening in the hotel, tourism and leisure (HTL) property sector and Bayleys has some good stock for sale.
The company says it has been fielding strong inquiry from both new entrants to the market and bigger parties looking to further consolidate their property footprint.
At the weightier end of the scale, genuine buyers are looking to secure stock while there’s less competition, while realistically, rising interest rates and escalating inflation may challenge owners of smaller-to medium-sized properties.
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For the first time since the start of the pandemic, owners of accommodation businesses now have 12 months of sequential figures to show potential buyers and their lenders, making exit from the sector smoother and providing confidence and more certainty for those looking to acquire assets.
Tourism recovery is under way with the prime hotel market operating at almost full capacity, occupancy rates on the up and room rates high.
Nationwide occupancy levels are approaching what they were pre-pandemic, and while transaction data from the Ministry of Business, Innovation and Employment (MBIE) shows fluctuating tourist spending patterns, every dollar spent is being welcomed by the accommodation, hospitality and retail sectors.
Queenstown has rallied faster than other main regions but staffing shortages and a lack of worker accommodation in the town remain pressure points.
However, the Government’s recent announcement that Working Holiday Scheme visas will have an automatic six-month extension is good news for the sector as it recalibrates, Bayleys says.
International visitor arrival numbers are tracking upwards with healthy interest out of Australia, North America and Europe.
But while flights and capacity on routes from China are ramping up, with large tour parties now accepted again, industry contacts suugest there are significant administrative delays for passport renewals and processing in China.
This is slowing the return of this important market.
— Article supplied by Bayleys
