Investor sentiment towards the New Zealand market is improving despite emerging disparity between locations, writes JLL’s Executive Vice President, Hotels and Hospitality, Nick Thompson.
The New Zealand hotel market is currently showing a bifurcation of demand and trading performance across many of its major markets and regions. This disparity has been highlighted by the strength of the Queenstown market, which is currently seeing surging international demand and high-yielding leisure and business travellers driving strong trading levels, and at the other end of the markets such Auckland are dealing with increased new supply, and Wellington are adjusting to reduced government spending.
International visitor arrivals continue to rise and have reached 3.37 million for the year ending May 2025, representing a 5.2% increase on the previous year (YE May 2024). While Australia remains the dominant source market, its recovery has been outpaced by the source markets such as the United States and India, both of which have exceeded their pre-pandemic numbers.
Similarly, we are also witnessing a two-tiered market when it comes to investor appetite, with an emerging disparity between locations and asset class. However, overall investor sentiment is improving, being driven by a reduction in interest rates and the market widely being viewed as a transparent, safe haven.
This positive investor confidence was highlighted by our most recent record-breaking transaction, with the InterContinental Auckland selling for NZ$180 million to Singapore-based Hotel Properties Limited (HPL), in what was the largest single hotel asset sale ever in New Zealand.
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