24 September, 2015

Hotels feel the heat from Airbnb

An angry young businesman is on the phone and screaming

While a new luxury hotel is good news for Sydney, Tourism Accommodation Australia is demanding the government crack down on dodgy short term stays.

The announcement that Singapore’s Pontiac Land Group has won the right to develop the two heritage sandstone buildings in Sydney’s Bridge Street is a good sign for Sydney.

The group will turn two of the iconic buildings into a $300 million, 240-room luxury hotel, and it’s music to TAA’s ears.

“This is great news for Sydney tourism and is part of a wave of new hotels and serviced apartments that are scheduled to be added in the city over the next five years,” TAA’s CEO Carol Giuseppi said.

“The new hotels will play a crucial role in supporting the launch next year of the new International Convention Centre and will help elevate Sydney into one of the world’s greatest business and tourism destinations.”

But the hotel representative body is calling on the NSW Government to crack down on the flood of unregulated short-term accommodation that is unfairly competing with Sydney’s hotels. And by that, they mean the likes of Airbnb, the leading disruptor of the travel industry.

“The cost of developing hotels in Sydney is extremely high and needs to be based on a sustainable demand-led model if we are to continue to attract future investment,” Giuseppi added.

“The new investment in our city is threatened by the spiralling increase in unregulated short-term accommodation – some within a few hundred metres of the sandstone buildings – which are operating contrary to strata, council and other rules.”

“Investors in Sydney need to be confident that their hotel properties will be able to operate on a level playing field. It is estimated that there are over 10,000 rooms and apartments being made available for short-term rental across Sydney, many of which are operated as commercial businesses without the requisite permits. This is not good for future investors.”

“These unregulated short-term commercial accommodation providers do not generally employ people, they don’t pay the appropriate council charges, there is a question about taxation, they often do not meet safety requirements and they contribute nothing to tourism promotion.

“In other words, they are not a sharing economy, they are a taking economy.”

“With this exciting new project announced and other hotel developments in the pipeline we believe it is crucial that there is a review of rules and regulations to ensure future investment in the city’s tourism infrastructure is not jeopardised.”

The Pontiac Land Group has committed up to $300 million to convert the 19th century landmark buildings into one of Australia’s premier 5-star hotels when the re-development is completed by 2021.

Advertise with us

Email the Travel Weekly team at traveldesk@travelweekly.com.au

airbnb Hotel Singapore Sydney TAA Tourism tourism accommodation australi