Auckland, Wellington hotels drop, but southern markets strong – Horwath HTL

14th April 2025 By Paul Yandall | paul@propertyticker.co.nz | @propertyticker

Revenue per available room across Auckland and Wellington’s hotel markets struggled in March 2025, according to Horwath HTL. 

However, the consultancy’s latest New Zealand Hotel Performance Focus, which uses Hotel Council Aotearoa’s hotel data, showed the southern hotel markets fared well, led by Queenstown and Nelson/Marlborough.

“Revenue per available room across New Zealand hotels declined by 5.5% compared to the same period last year,” stated the report, authored by Horwath HTL director Wim Ruepert.

“This drop was mainly attributed to significant declines of 10% or more in Auckland, Wellington, and the Central North Island. These losses were partially offset by RevPAR growth in Queenstown and the Nelson/Marlborough region, which again demonstrated a strong performance.”

Horwath HTL said Auckland’s hotel market continued to face challenges from “increased competition, limited event-driven demand, and shifting consumer preferences across different star categories”.

“Hotels reported an 11.2% decline in RevPAR for the month, attributed to a 4.2% increase in room supply following the opening of five new hotels over the past year and a 7.1% drop in average daily rate (ADR).”

The consultancy noted that apart from the Auckland Arts Festival, there were no major events in the city to significantly boost hotel demand during March.

It said that RevPAR for the city’s hotels declined by 10% over the last 12 months, with the most significant drops in the 3 to 4.5-star categories, while newly opened 5-star hotels have seen a smaller 3% decline. 

The majority of supply increases over the past six years have been in the 4 and 5-star categories, with 5-star hotels absorbing more of the new supply and traditional 4.5-star properties losing market share to newer 4 and 5-star hotels.

Wellington also struggled in March, despite a number of significant conferences at Tākina Wellington Convention & Exhibition Centre and large events such as international sport and the Pride Festival during the month. They did not stop a five percentage point fall in occupancy compared to March 2024 and a 10% drop in RevPAR over the first three months of the year.

In comparison, Queenstown returned a “strong performance” for March, with ADR up 8.4% and occupancy consistent compared to the same month last year.

“The 4.5 and 5-star hotel categories excelled, with ADR growing by 9.1% during the month,” stated Horwath HTL. 

“This growth resulted in a quarterly ADR of $453.50, marking a 13% increase compared to the first quarter of the previous year.”

The consultancy’s latest New Zealand Hotel Performance Focus can be read here.