Hotel rooms could be empty in the future

Press, 19 June 1987, Page 6

Hotel rooms could be empty in the future

Christchurch could have many empty hotel and motel rooms in the future, said a marketing consultant, Mr Ronald Friedman. The same thing that happened in Singapore could very easily happen here, said Mr Friedman. Hotels in Singapore used to enjoy 76 to 78 per cent occupancy rate, but were now fighting for 35 to 45 per cent, he said. The hospitality business in Christchurch could expect reasonable growth for one to two years, but a shake-out was inevitable, and would probably mean empty rooms. Mr Friedman spoke at a hospitality business clinic in Christchurch yes- • terday. He is the director of consulting for Horwath and Horwath New Zealand, Ltd. He said that the rapid

expansion of the number of hotels and motels in *he city, and developments such as Queenstown airport, were of concern to people in the business in Christchurch. The people most likely to suffer were the small operators, as the multimillion dollar projects were likely to survive because of the strength of the parent companies, he said. A problem was that optimism was contagious. “Where there seems to be success, everyone jumps in, not really thinking about the likelihood of success.” Individual operators were being impulsive and taking on motels as property investments without' really considering the likelihood of success. Tourists were increas-

ing in numbers to Christchurch, but they were staying for. shorter periods. Mr Friedman said that people should think before they jumped into the business. If already in it, however, it was important to do market research to find out what people wanted. Staffing was also very important. “We still have a. long way to go with standards of service in this country,” he said. The Christchurch hospitality business had enjoyed a fairly easy life until now, he said. People had not had to go out and chase business because there were not many good hotels. Now the situation was changing, and the need to respond to competition was important.