66 hotel rooms a month: Incredible building target needed to meet 2032 Olympics demand in Brisbane
Brisbane hotel room rates will have to soar to as much as $700 to spur developers to build enough accommodation for 2032 Games visitors, an expert has warned.
Brisbane hotel room rates will have to soar to as much as $700 a night in peak periods to incentivise developers to build the 66 new hotel rooms needed every month by 2032, a forum on the city’s economy has heard.
Obstacles holding back hotel construction, particularly the very long return on investment, meant it was “impossible’’ to meet the ambitious Olympics target unless maximum room rates doubled, Brisbane Economic Development Agency boss Anthony Ryan said.
Mr Ryan made the dire prediction at Thursday’s launch of the 2025 Brisbane Inner City Vitality report, which also revealed that Kangaroo Point has emerged as the inner-city’s top residential real estate performer.
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The Vitality report said the city’s room rates had jumped 40 per cent in one year to $274 a night.
Mr Ryan said prices were even higher in May when Brisbane hosted the NRL Magic Round and the Australian Truck Show.
“The average price was actually above $500, it was closer to $540, so that’s getting to a point where we are more than Sydney and Melbourne,’’ he said.
“The reason why we’re there is because demand is absolutely outstripping supply.
“We definitely don’t have enough hotels and we do need to attract greater investment in that space.’’
Mr Ryan said the state government’s Destination 2045 plan forecast that 40,000 new hotel rooms must be built nationally by that year, with 16,000 of them in Brisbane.
“On the numbers we need, 16,000 hotel rooms, if we start adding that up between now and 2045 that’s 66 hotel rooms we need to build per month from now on,’’ he said.
“But one of the recent reports is saying that you need to have a rack (maximum) rate sitting around about $700 for it to actually be a (viable) investment space.’’
The rack rate is the highest published price for a room, sometimes called a “walk in’’ or “retail’’ rate. It is set at close to the maximum charged during peak periods.
Committee For Brisbane CEO Jen Williams said CFB’s 2025 Vitality report also found that Kangaroo Point was surging ahead of other inner-city suburbs.
So many young people were moving in that the vacancy rate had dropped to an inner-city low of 0.8 per cent. Median unit sale prices were also the highest at $750,000.
South Brisbane was another star performer, boosted by a population that was predicted to grow from just under 20,000 to nearly 40,000 in the next two decades.
After several years of stagnation, median rents had surged to $675 per week by June this year, a 75 per cent jump since 2019.
There were 8217 units in the area last year. But in the past month alone plans have been lodged for huge residential towers that would deliver more than 1000 dwellings, if approved.
Fortitude Valley has marked time, in contrast, with a small drop in the number of businesses and only a small rise in median rent to $600 a week in June.
However its population was also expected to almost double by 2046.
Spring Hill was also quiet. The number of units there has flatlined over the past three years and the number of sales was still well down on the peak two decades ago, although sale prices have grown steadily since Covid.
Woolloongabba had the lowest population density in the inner city, the Vitality report said.
That was expected to more than double by 2046 after the announcement last month that onerous development conditions would be relaxed. Rents have also doubled in six years to $640 a week.
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