As to the rest of the Hotel sector there are definitely changes in the wind. With the use of technology advancing so quickly in Hotels, both in the United States and Europe, where they can now provide a no-frills customised service to guests at a much lower cost is this what the future may hold for Australia? These ‘no-frills’ or pod hotels can be highly appealing to international visitors, who want to spend less on a room but also have the knowledge that it is clean, comfortable and safe. Brands such as Yotel, Tune Hotels and easyHotel are as small as 10 square metres including shower room. Three of these pod rooms can fit in the size of one traditional full service hotel room, but the room rate is not one third the price. The returns to the investor are therefore much higher. ING’s limited service brand, Holiday Inn Express, is under construction in Perth and will be Australia’s first. No doubt more will follow.

Room rates continue to rise and occupancy remains consistently high. This, combined with higher yields compared to other major cities worldwide, it is no surprise that hotels are proving attractive to overseas investors. The Four Seasons in Sydney started with a price tag of $400 million, and it is more than likely it will be purchased by an overseas investor.