Vancouver hotel prices next year are set to increase at a faster rate than other major Canadian cities, according to a new AMEX Global Business Travel Hotel Monitor report.
The rise in prices is fueling investor and developer interest in building more hotels in the city.
The AMEX report suggests that Vancouver hotel prices are set to increase 8.9 per cent, which tops Montreal's anticipated 8.3-per-cent increase and Toronto's 6.7-per-cent increase.
The report also listed 10 U.S. cities, four of which are expected to see hotel prices rise by higher percentages than Vancouver's rate:
• Chicago at 12.6 per cent;
• Boston at 11.3 per cent;
• San Jose at 10.2 per cent; and
• Portland at 9.5 per cent.
Canada’s hotel industry is seeing record average daily hotel rates and revenue per available room in 2023, with Vancouver seeing the country’s highest occupancy, at 89 per cent, according to the report.
CoStar, which provides global real estate data, analytics and news, backs up the AMEX report's claim. Its data show the country's hotel industry hitting records for average room rates in May, June and July.
Canada's average daily hotel room rate rose to $232 in July, up 29 per cent from July 2019, before the COVID-19 pandemic caused an almost complete shut down in the sector, according to CoStar.
Vancouver's average July hotel-room price jumped to $346 – the highest monthly rate ever recorded by a Canadian city, according to CoStar. CoStar pinned Vancouver's occupancy rate at 87 per cent, which was slightly below that reported in the AMEX report but would be the highest among major Canadian cities.
Plenty of new hotel projects are set to launch construction across Canada, aiming to increase supply and put downward pressure on rates, but new rooms may not arrive in significant numbers until later in 2024, the AMEX report said.
Vancouver city councillor Sarah Kirby Yung, in particular, has been advocating for more hotel rooms built in the city.
One potential project is at 717 Davie Street – a street address that does not currently exist but which would be where the Cold Tea Restaurant is situated, at Granville Street. A rezoning application for that project was submitted to the city by Musson Cattell Mackey Architects on behalf of Deecorp Properties.
Amacon is building a 120-room hotel at 150 Robson Street.
Some other potential future Vancouver projects include:
• a 32-storey, 578-room tower at 516-534 West Pender Street, which Marcon aims to build after navigating a rezoning process;
• a 30-storey, 393-room tower at 848 Seymour Street that involves Paul Y. Construction, Forme Development and Perkins & Will Architects; and
• an office building at 1144 Burrard Street that Amacon may convert into a hotel.
