Lack of domestic travel sees hospitality in crisis
Hospitality New Zealand says domestic travel has stalled, with forward bookings showing accommodation occupancy rates as low as 20% for the next three months.
The industry organization said Auckland locations operated with an average occupancy of less than 20% in January, when MIQ accommodation was excluded, with Wellington averaging less than 30%.
“Every canceled event results in hundreds of cancellations of room, dinner and drink bookings,” said Julie White, Managing Director of Hospitality NZ.
“The government has overcooked fear and health rules. People are afraid to go to their local shops, let alone go to another city. Whatever we try to do, no booking means no business .”
She said the accommodation sector needed a reinstatement of the wage subsidy and resurgence payments.
Cordis Auckland chief executive Franz Mascarenhas said the hotel was making losses in the millions.
“We have retained our workforce in the hope that things will improve, but the extended period brings us to a position where difficult decisions will have to be made,” he said.
“What we expect from the government is an indicator of the criteria used to bring us back to Orange (parameters) and a targeted deadline for the removal of isolation requirements, so that the industry can start trading again. And in the interim, financial support to allow us to pass.”
TOP 10 Holiday Parks group chief executive David Ovendale said bookings after the traditional Christmas holiday period “have fallen off a cliff”. “There is no long summer lineup this year,” he said.
“If it takes another six months to get through this next phase of the pandemic in New Zealand, the effect on holiday parks and the wider accommodation industry will be terminal for some, perhaps for many – we have to learn to live with this virus,” Ovendale said.
Hannah Chinnery, operator of the Wellington-based Bolton Hotel, said the business terms were “terrible”.
“It’s the worst we’ve had in 18 years,” she said.
“In the absence of financial support from the government, we are burning money and making unsustainable losses.”
The owner of the Riverstone Motel in Rangiora, Mike Dougan, said the industry needed financial support now.
“The phone almost stopped ringing. If it does, someone is canceling,” he said.