Perth's tourism sector is expected to receive a boost from the Ritz-Carlton & The Towers proposal at Elizabeth Quay, with national construction contractor Probuild confirming it has been appointed to undertake the project.
Perth's tourism sector is expected to receive a boost from the Ritz-Carlton & The Towers proposal at Elizabeth Quay, with national construction contractor Probuild confirming it has been appointed to undertake the project.
But despite the likely shot in the arm the $400 million Ritz-Carlton development will provide for the sector, Perth’s hotel market is continuing to slide due to declining demand from the mining sector and increased supply.
Business News broke the news in March that Probuild had been selected following a lengthy selection process by developer Far East Consortium.
The Ritz-Carlton project is perhaps the most prominent hotel development in recent memory, perched on the edge of the city as the flagship project at Elizabeth Quay.
As well as a 204-room luxury Ritz-Carlton hotel, the development will also include two apartment towers containing 335 dwellings.
Probuild will undertake final design works immediately with an expectation that site works will commence late next month, while the three-tower project is scheduled to be completed by 2019.
The project is likely to lift Perth’s international profile, in concert with other major global hotel brands’ substantial plans in Western Australia.
Construction is proceeding rapidly on BGC Development’s Westin Perth at 480 Hay Street, while Crown Resorts’ Crown Towers is nearing completion, with both projects expected to be big game changers for luxury lodgings in Perth.
Sheraton also has designs on Perth, with a 42-level hotel proposed for on The New Esplanade Hotel site in the CBD, while Hilton has plans for four new Perth properties under its DoubleTree by Hilton and Hampton Inn by Hilton brands.
Perth property identity Adrian Fini is also pursuing another hotel project at Elizabeth Quay, following the successful opening of Como The Treasury, in partnership with Malaysian developer AAIG.
Marriott is another with big Perth plans, with a Courtyard by Marriott planned for Wellington Street, close to where Mantra Hotels is constructing a 120-room hotel opposite Kings Square.
While the interest from international brands is expected to be a boost to the tourism sector, the extra supply comes at a time when hotel operators are experiencing subdued demand from the resources sector for midweek lodgings.
A recent report by CBRE showed average room rates were down 6.8 per cent to $191 per night in the year to the end of March, while occupancy rates had fallen 1.4 per cent over the same period to 80 per cent.
With 1,740 rooms under construction and more than 3,300 in the planning pipeline, any recovery in the market from the mining slowdown will likely be a challenging proposition.
However, Perth hotels still command some of the highest rates in the country, according to CBRE, and are outperforming other sectors in the property industry.
