Gold Coast hotel rates declared ‘too expensive’ by leading tourism figure

A leading Gold Coast tourism figure says the city’s hotel rates are too expensive and driving visitors to cheaper locations, sparking a debate about the future of accommodation. FIND OUT MORE

Tourism leaders insist the Gold Coast’s hotel rooms are cheap enough in an increasingly competitive market.

The Gold Coast has the second-highest annual hotel rate for any city in Australia and, with international visitation numbers still below pre-Covid levels, former Gold Coast Tourism chairman Paul Donovan says it must change.

Mr Donovan, now chairman of the Gold Coast Marathon, said lower hotel room rates would make the Gold Coast more competitive compared to other major locations through Asia.

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Former Gold Coast tourism boss Paul Donovan. Picture: Richard Gosling

“Domestically, tourism is going exceptionally well, the numbers are there but the only thing I’d say is the hotel rates are too expensive,” he said.

“When you’re looking to stay at a Grand Hyatt in Shenzhen for $230 a night, and you’ve got to pay $350 for a place here, that puts people off.”

Multiple new luxury hotels have opened on the Gold Coast in recent years including the Langham Gold Coast on the Surfers Paradise beachfront and The Mondrian at Burleigh Heads, all aimed at the highly lucrative luxury market.

But Experience Gold Coast CEO John Warn said the high occupancy rates of the city’s hotels across the year meant it was not necessary to slash room rates.

The Mondrian Gold Coast at Burleigh Heads

“While we have the second highest annual hotel rate in Australia, the comparative spread of that pricing across different types of properties from two star up to five star is very important to note and that’s also the average.

“I do have some sympathy for Paul’s perspective, which is born from the first year or two coming out of Covid when the Gold Coast did become a hot hotspot for domestic travel, when people neither could travel overseas or were nervous about travelling.

Experience Gold Coast CEO John Warn. Picture Glenn Hampson

“At the end of the day the greatest determinant is your occupancy and occupancy is really solid and our 70 per cent result across all markets for the full year is a great result and reflects that the pricing is appropriate and consumers are voting with their feet.”

Former Tourism Australia boss and Mantra Group CEO Bob East said the Gold Coast had some “amazing” accommodation which compares competitively against benchmarks.

Mr East, now the chairman of new company Leisure Accommodation Collective Australia with brands including Drifter and Village, said he did not see room rates as a competitive issue but said new product was critical for the market.

“The Gold Coast is evolving to a higher value traveller destination and it needs to continue to invest in new properties that will service this market and that means existing properties need to reinvest also.

Bob East Picture, Portia Large.

“To do this the hotel owners cannot discount their way to success and must move beyond the low-cost destination mentality and compete internationally for guests that deliver much greater in destination spend.

“Locals understand the high-calibre lifestyle on offer, so why on earth would we discount that proposition.

“I’m travelling through Asia at the moment and I can assure anyone that hotels charge a lot more in Singapore and Hong Kong compared with our major destinations.

“It’s time for the Gold Coast to creep up the world rankings and position ourselves as the world-class destination it is.

“None of this means we cannot offer value accommodation to budget conscious travellers – it means the spread of options can only increase with new supply of new builds and renovations are financially viable.”

Editor’s note: The Bulletin acknowledges the Future Gold Coast sponsors for supporting this important series and notes sponsors have no control over the content or views expressed.