The Australian city of Melbourne is welcoming a tranche of new hotels over the coming months, as the destination is in the grip of a building boom.
According to agents JLL, 22 new hotels have opened in the Melbourne region since 2019, and plenty more a are in the works. No less than 1,100 luxury and upscale rooms are set to join the stock over the coming year, with the City of Melbourne approving new developments that include hotels and other commercial space.
Demand rises to fill new supply
Thankfully, demand is also growing, with occupancy rates in July 2024 at a respectable 74%. Recent events such as the Melbourne Grand Prix helped boost demand, sending occupancy levels above 90%. The 2023 National International Visitor Survey showed Melbourne was the top ranked city in Australia in 2023 for interstate overnight trips, with 3.9 million visitors spending around AUD5.1bn, substantially boosting the local economy.
“The compact nature of Melbourne’s CBD and the breadth and diversity of the precinct’s hospitality and tourism offers are very appealing to domestic and international visitors alike,” said Accommodation Australia general manager Dougal Hollis. “Few cities in the world boast world class sporting and event stadium infrastructure within walking distance of our city’s vast hotel accommodation network.”
Standard Hotels chose the city for the launch of its new StandardX brand. In mid 2024, the hotel launched in Fitzroy under the brand described as the younger, wild child sibling of the Standard parent. Externally, concrete and rusted steel provide an industrial vibe, while the hotel’s 125 rooms have a stripped-down feel.
Also new to the market are a pair of Accor hotels, at the city’s airport. The dual branded Ibis Styles and Novotel, with a combined 464 rooms, will meet the demand from record numbers of travellers at the airport.
Next year, luxury brand Shangri-La will join the party, opening in a twin towered development that overlooks the city’s Carlton Gardens. The 492 room development will feature a rooftop garden pool for guests to enjoy.
A strong pipeline
Among new projects being added to the pipeline are the Hoxton Melbourne, announced by Ennismore in August 2024. The 198 room hotel will open in 2027 in the Matchworks Precinct being developed in Cremorne, and will be the brand’s first property in the region. It adds to the brand’s growth, with other projects in Edinburgh, Florence and Oslo already in development. Another Accor group brand, So/, is also scheduled to arrive in Melbourne in 2026 with a 289 room luxury property.
IHG Hotels and Resorts is not being left out. The group has three hotel projects active in Melbourne, including two due to open in mid 2025 in the same city centre development. These are the 273 room Holiday Inn at Bourke Street Mall, and a 179 room Hotel Indigo. These will be joined in 2026 by the voco South Melbourne, with 172 rooms.
