Appendix A - Economic Impact Assessment.pdf

                                                               Noosa Springs Luxury Hotel Economic Impact Assessment
                                                                                                         Final Report

4.2 Market Indicators
Prior to the COVID-19 crisis, the Noosa hotel market was performing well. While occupancy rates
remained stable around 75%, average daily rate showed strong growth, averaging 6.5% growth per
annum (Figure 4.2 and Table 4.4). Given the seasonality in the market, an occupancy of 75% on an
annual basis would indicate a shortage of rooms, particularly during peak periods. It is likely that the
stabilised occupancy rate of 75% represents a cap in the market (i.e. given the shortage of hotel
rooms and the seasonal market, it is not possible for occupancy rates to climb much higher). The
strong growth of average daily rates supports this situation as demand climbs and the room supply
remains stable, pricing will increase. Furthermore, the strong performance of Airbnb demonstrates
that additional demand is in the market and listings have increased to meet this demand.
It should be noted that the $334 ADR in Noosa is well above all capital city markets in Australia and
many other tourist destinations. For the year ending December 2019, Sydney has the largest ADR
($250), followed by Melbourne ($201) and the Gold Coast ($190). Furthermore, Noosa has achieved
this result, despite a lack of luxury properties, that do exist in Sydney, Melbourne and the Gold
Coast. This result demonstrates the premium that Noosa can command as a destination.
While the occupancy rate in Airbnb listings is much lower than in the traditional accommodation
market, the demand satisfied through Airbnb is significant, representing 200,000 annual nightly
bookings (pre-COVID). Combined, these bookings attracted over $80 million in revenue. This level of
revenue would be sufficient to support 900 traditional short-stay accommodation rooms.
Figure 4.2 Noosa Hotel Market Indicators

                      100%                                                                     $400
                      90%                                                                      $350
                      80%
                                                                                               $300
 Occupancy Rate (%)




                      70%
                      60%                                                                      $250

                      50%                                                                      $200
                      40%                                                                      $150
                      30%
                                                                                               $100
                      20%
                      10%                                                                      $50

                       0%                                                                      $0
                              2015        2016            2017        2018         2019
                              Occupancy          Average Daily Rate      Revenue per Available Room

Note: Year ending December.
Source: STR (2020); Lucid Economics
Table 4.4 Noosa Hotel Market Indicators
                         Occupancy (%) Average Daily Rate ($) Revenue per Available Room ($)
 2015                           70.6%                $259.62                         $183.27
 2016                           75.0%                $284.26                         $213.08
 2017                           76.9%                $310.11                         $238.55
 2018                           77.1%                $322.93                         $249.12
 2019                           75.9%                $334.01                         $253.51
Note: Year ending December.
Source: STR (2020); Lucid Economics




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