Increasing overseas investor interest has helped to encourage a growing number of hotel deals in Australia and New Zealand, according to Global Asset Solutions’s Australia vs. New Zealand Market Comparison 2025.
The study found that lower debt costs and weaker currencies, as well as the return of Asian investors to markets such the UK, Europe and Japan, helped drive deals.
Both markets saw an increase in visitor nights. In Australia’s 2022-23 fiscal year (1 July – 30 June), international visitor nights, and trip spending, exceeded 2019 levels by 2% & 3% respectively.
In the future, it is predicted that international visits will surpass pre-pandemic numbers by 2025 and reach 9.5 millions trips. By 2028 it is projected to reach 12,1 million visits, a 27% increase over 2019 levels. The growth rate for the next five year period is 12.9%.
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Hotel construction is driven by the recovery of tourism. Australia will add around 1,800 new rooms by 2024. The majority of these will be in Melbourne. There are also 5,700 more rooms planned. New Zealand added 850 rooms last year, and 1,600 are under construction.
The transactions market was slow last year, but has started off strong in 2025. In Australia, sales of $676 million were recorded in the 1st quarter. This is double what was reported in the same period last year.
The sale of the InterContinental Auckland Hotel by Precinct Properties in March for $180m to Hotel Properties Limited, which included 139 rooms, meant that the $250m total volume of deals in Q1 exceeded both the full years of 2024 and 2023. It was also almost as high as the entire year of 2022.
Alex Sogno, CEO Global Asset Solutions, a report author, stated: “Australian and New Zealand are becoming increasingly popular destinations for domestic and international travelers, attracted to their rich heritages and natural features. The demand for hotels in both countries is increasing as a result of these rising numbers.
We are seeing an increase in interest from international groups from Europe who want to scale up their operations by purchasing portfolios of hotels and operating platforms. Franchises are becoming more popular among owners who wish to retain control over their assets. This suggests that motivated asset managers will have a larger role to play in maximising the potential of an investment.
