Thanks to Australian hotel magnate Jerry Schwartz, Sydney can expect the addition of much-needed hotel rooms in the near future.
The Schwartz Family Company has announced that two floors and 38 rooms will be added to its Rydges Sydney Central to cater for record room demand in Sydney, with construction scheduled for completion by the end of 2016 and at a cost of up to $4 million.
The extension of the Rydges hotel follows a complete makeover of Schwartz’s Rydges World Square and will complement the building of the Sofitel Sydney Darling Harbour, which will be owned by Schwartz Family Company on its completion in 2017.
“Our architects were able to identify space on top of the existing low-rise part of the hotel, and by using lightweight construction, guests in the rest of the hotel will barely know that 38 rooms are actually being built,” Dr Schwartz said.
“New constructions in Sydney are relatively difficult because of the cost of land, and Sydney is crying out for new rooms.”
The extension of the hotel, which has 271 rooms, follows 15% revenue per available room (REVPAR) growth over the past nine months. Average occupancy for 2015 is expected to average 93%, up from 84% two years ago when the hotel was rebranded.
The REVPAR growth mirrors the average growth rate across the Schwartz hotel portfolio in Sydney, with the company’s five hotels achieving record performances this year.
However, Dr Schwartz said it would be hard to sustain occupancy levels at current levels with so much new supply scheduled to come on to the market, with the addition of the International Convention Centre, which he is buying from Lend Lease.
“Rates have increased in Sydney over recent years,” Dr. Shwartz said, “But then, so have the quality of hotel facilities and standards.”