exist Um In 2025, Australia's development prospects, Scott Boyes, CEO of Trilogy Hotels, shares key opportunities and insights into Australia's growing hotel development environment.
As we sail into 2025, there are still some exciting moments. Australia's hospitality industry, while the turbulent people continue to prove significant resilience, with a national occupancy of 71%, and Revpar rose 3.8% to $171. Despite the ongoing challenges, this growth still has a mature landscape of obstacles and opportunities.
Sydney leads the recovery charges with a 78% occupancy, while Revpar's occupation is $215, which makes our outstanding performance make this market. Instead, Melbourne and Hobart continue to face headwinds due to increased supply, with demand for home leisure slightly softening.
In New Zealand, we see similar dichotomies – Queenstown, Christchurch and Rotorua benefit from returning international visitors. Auckland is relating to increasing room inventory, and Wellington is adapting to reduce government spending.
Third-party management, stakeholder experience and technology integration are key trends that reshape our industry. The nature of ecological certification is no longer a niche, but a necessity, and major operators prioritize this. The premium/luxury segment continues to expand, especially branded residences attract domestic and international guests.
The premium and experiential hospitality sectors offer compelling opportunities. As travelers increasingly value authenticity over standardization, properties that offer immersive experiences. We also see excellent performance in market portfolio diversity, where segments are combined to offset the ups and downs of current economic and global conditions.
In 2024 ($1.25 billion in transactions as of October), after trading activity shrinks, we expect momentum in 2025 to increase with interest rate plateaus. Although construction costs ease new developments, this increases the value of existing assets, especially in supply-bound markets. In addition, developers are taking innovative ways to deliver economically viable hotel projects.
The introduction of 60 new international flight routes can enhance Australia's connection with major Asian markets, North America and Europe, further strengthening the investment base of strategic location assets.
For Trilogy Hotel, we are excited and optimistic about the future. We remain focused on markets that show strong performance to owners while selectively exploring opportunities for emerging destinations where we can take advantage of these evolving consumer preferences and travel models.
