British accommodation giant InterContinental Hotels Group has unveiled plans for a new Holiday Inn hotel to be built in trendy inner Melbourne suburb Richmond.
The hotel, featuring 160-rooms over eight levels, will be built on a site directly opposite Burnley Station providing sports fans quick access to the MCG and Rod Laver Arena.
The deal for the new hotel follows a long-term management agreement between IHG and a joint venture between Pelligra Group, PrimeLand Group and Diamond Hospitality Singapore.
The Holiday Inn Melbourne Richmond will mark the second hotel signed between IHG and Pelligra Group, with Holiday Inn Melbourne Werribee also scheduled to open in early 2021.
IHG currently has 47 hotels operating under four brands in Australasia, including: InterContinental, Crowne Plaza, Holiday Inn, Voco and Holiday Inn Express, with another 29 in the pipeline, including Hotel Indigo and Even Hotels.
IGH vice president of development Abhijay Sandilya said Holiday Inn had made its mark as one of Australasia’s fasted growing hotel brands, and Holiday Inn Melbourne Richmond would complement its 28 open or pipeline hotels.
“Not only is Richmond a great destination for sports fans, it boasts a number of demand drivers in the technology, health and education space, and we are confident this hotel will be a favourite with corporate, event and VFR travellers.”
Late last year, IHG announced plans for a 252-room upscale hotel, Voco Melbourne Central, at the under-construction Melbourne skyscraper at 380 Lonsdale Street.
IHG is set to open a 164-room Holiday Inn in Ringwood in 2020 and is currently working on a 150-room Holiday Inn in Coburg, while Holiday Inn Express hotels on Southbank and Little Collins Street are being developed by IHG franchise partner Pro-invest Group.
According to preliminary data from research from industry analysts STR, Melbourne's hotel market is currently being negatively impacted by a rapid rise in supply.
STR has found that Melbourne’s supply of hotel rooms had risen 4.4 per cent year-on-year, while demand for accommodation increased by just 2.9 per cent.
Occupancy retracted by 1.4 per cent to 85.2 per cent over the month of October, compared with the year prior marking the lowest absolute occupancy levels in Melbourne in six years.
The average daily rate also dipped by 3.5 percent to $188.95, resulting in a slump in revenue per available room of 5 per cent to $160.98.