A PREDICTED rise in international tourism and more mobile domestic travellers will give the national hotel and accommodation sector a much-needed boost, according to hotel investors.
One of the latest groups to take advantage is Quest Serviced Apartments, which next week opens its site at Sydney Olympic Park.
The Quest chairman, Paul Constantinou, said he was excited at the prospect of further expanding the brand across NSW.
The Gold Coast company Mantra Group is also in expansion mode, with a further two properties joining the Peppers and Mantra hotel networks in New Zealand.
The addition of Peppers Portage and Mantra Lake Tekapo will bring the New Zealand network to 12 properties - eight Peppers retreats and resorts, two Mantra resorts, and two BreakFree resorts.
The Mantra Group chief executive, Bob East, said the New Zealand developments were part of an Asia-Pacific expansion.
The group will open its first property in Asia in March - Mantra Nusa Dua in Bali. A Peppers development is set to open on Naisoso Island in Fiji in early 2014.
''Peppers is one of the fastest-growing luxury hotel brands in New Zealand, having added four spectacular properties to the network in 2012, with further expansion scheduled in 2013,'' Mr East said.
From an investment viewpoint the sector is earmarked for growth, said Paul Guest, Asia strategist at LaSalle. ''Robust economic growth in key markets, led by China and south-east Asia, has helped boost the size of the middle-income population,'' he said.
''In turn, this has fuelled the propensity to travel and generated new demand for better-quality accommodation and infrastructure.
''Mid-market hotels in gateway cities do generate stable income returns relative to other commercial asset classes. In addition, they deliver attractive risk-adjusted returns and continue to outperform other real-estate sectors in the core capital cities in Australia.''
A report from LaSalle says tourism growth has outstripped development since 2004-05, increasing occupancy and room rates across capital cities, driven by the steady growth of Chinese and south-east Asian demand.
The domestic travel market is stabilising after a decade of decline, led by business travellers. The national director of asset management at LaSalle, Steve Carroll, recommended ''core and value-add'' investors consider including hotels as an investment class to achieve a more diversified and balanced portfolio.
''Investors with a higher risk threshold can consider undertaking development and repositioning projects,'' he said. ''To mitigate the associated risks and challenges, it is appropriate to partner with an experienced asset manager.''