Cheap hotel rates are history: Mantra

Posted Thursday, 01 July 2010 at 17:07 by CBT Admin
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The days of the really cheap hotel rates are gone according to this article today in Travel Today.

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Business travellers have been warned to no longer expect “bargain basement” hotel rates as corporate travel returns to preglobal financial crisis levels.
Mantra and Accor are both reporting strong occupancy and price rises with all major markers performing well.

“This is a welcome relief to the industry, which is emerging from an extremely price sensitive market,” Mantra chief executive Bob East said. “The corporate
travel industry is back and the days of bargain basement hotel rates have well and truly gone.”

Melbourne was described as the “stand out performer” by Mantra despite being the only city to see increased capacity. Occupancy averaged more than 80%, up 10% on the corresponding period last year, while revenue per available room (revpar) also climbed by 10%.

Sydney saw the strongest occupancy growth with a 17% increase. June occupancy hit 80% with revpar rising $20.Brisbane is also performing well, the company said. East said it took a while for firms to comprehend that rates would rise as demand returned. Those who entered into rate contracts at the beginning of the year are noticing the benefits of favourable rates, he said. Accor said rates were back to mid-2008 levels and were only likely to head one way - up. “Most corporates understand there has been two years of rate stagnation and that rates are going up. It is a simple case of supply and demand,” a spokesman said. “Their greatest concern is getting last room availability.”

Sydney rates have risen up to 15%, Adelaide and Brisbane 5% while even Melbourne, with a glut of new rooms, has remained on par. “This doesn’t mean the rates are excessive,” the spokesman added. “Just back to what they were.”

Steve Jones - Travel Today July 1 2010