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NZ hotels flooded with booking cancellations in lockdown

Hotels throughout New Zealand are being inundated with mass booking cancellations as the impact of COVID-19 lockdown hits an already decimated sector.

With Auckland placed in Alert Level 3 lockdown and the rest of New Zealand on Alert Level 2, hoteliers up and down the country are fielding calls from thousands of domestic and corporate travellers cancelling their accommodation.

New Zealand Hotel Owners Association executive director Amy Robens is describing latest impacts on the struggling sector as "beyond grim" and the ongoing repercussions seemingly endless.

"Auckland is a big market for hoteliers throughout New Zealand when there is no international visitation and booking cancellations for domestic leisure and conferences, even just through to the end of August, is costing the struggling hotel sector many millions of dollars," she says.

"While we support the Government’s decisive action to tackle COVID-19 community transmission, urgent financial relief including a targeted extension to the wage subsidy must go beyond Auckland with hotels throughout the country feeling the full impacts of the region’s Level 3 lockdown.

"Hotels are particularly hard hit by enforced lockdowns given they can’t re-open quickly and profitably in the same way as many other businesses. Hotels need to generate enough forward bookings to make their business viable, and given we are losing bookings many will return to single-digit occupancy," says Amy.

"Hotels typically lose money unless they reach at least 70 per cent occupancy.

"Accommodation providers feel we have been side-stepped in the Government’s $400 Tourism Recovery Package. Now is the time to support the sector by allocating some of the $14 billion dollars from the COVID Response and Recovery Fund.

"At its peak the hotel sector employed 20,000 people. Our workforce has more than halved and will likely continue to decline. With record low occupancies, low margins and virtually no profit, the situation is beyond dire.

"Any extension to the current lockdown status will see the moderate level of business hotels are experiencing wash completely. We are at the end of the road," Amy says.

Hotels in areas such as the West Coast of the South Island, in particular South Westland, Bay of Islands and Southland/Fiordland – are especially struggling and have either been mothballed or are running with low single-digit occupancies.

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