NAB’s Commercial Property Survey Q1-2019 reports that sentiment in the CBD Hotels sector has fallen sharply, posting its first negative read since mid-2016
• NAB polled over 300 property industry professionals
• Sentiment in the CBD hotels sector was down from 13 to -13
• Eastern states were largely behind the lower market sentiment
Weak sentiment towards the slowing of the CBD hotel sector has led to a negative result in NAB’s commercial property index. Sentiment in the sector was down from 13 to -13, its first negative reading since mid-2016.
The survey polled over 300 property industry professionals and insdicated that negative expectations for capital and revenue over the next one to two years were key factors that caused confidence to fall.
The report stated that “Confidence also slipped deeper into negative territory in the CBD Hotels sector on the back of weakening expectations for both capital and RevPAR growth in the next 1-2 years.”
NAB Group chief economist Alan Oster said several market conditions were behind the result.
“This will have been influenced by the slowing economic growth momentum into the March quarter, with the situation in discretionary retail and consumption more generally deteriorating even further,” Mr Oster said.
Falling room rates were a major issue at AHICE hotels conference last week.
"My Sydney hotels are at 90 percent occupancy and yet my revenue has dropped 10 percent," said hotel owner, Dr Jerry Schwartz.