Christchurch Earthquake Drives Up Hotel Demand in Other New Zealand Cities

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According to STR, hotel occupancies in Christchurch fell significantly following the earthquake on February 22, 2011. This caused a 15.3-percent occupancy decrease for the first two months of 2011 -- a decrease that was strongly influenced by a 25.2-percent drop reported in February.

Hotel Performance for selected New Zealand Cities (year-on-year percentage change, NZD)


Though Christchurch has suffered in the aftermath of the earthquake, hoteliers in other major cities throughout New Zealand are pushing rates after posting occupancy and demand increases during 2010. Nationwide, average daily rate (ADR) has improved by 3 percent to NZD138 in the first two months of 2011 despite a 2.1-percent fall in occupancy. Auckland and Queenstown improved their ADR year-to-February, reporting NZD141 and NZD155, respectively. Wellington, despite a continued drop in rate growth, still reported an ADR of NZD146 and occupancy of 72 percent.

With the ongoing clear up in Christchurch and the uncertainly over how many hotels might need to be torn down, performance will remain subdued. The city reported an ADR of NZD114 and occupancy of 70 percent for the first two months 2011.

However, prospects for the remainder of the country are boosted by the Rugby World Cup, which is set to attract huge travelling support in New Zealand during several weeks in September and October 2011. Plus, significant future marketing benefit is to be expected now that the much delayed filming of The Hobbit, the prequel to the J.R.R. Tolkien's Lord of the Rings trilogy, has begun in Wellington.

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