Five hotels now under construction in Sydney CBD

These projects will add over 1,000 rooms to the hotel market.

According to a JLL report, the Eve Surry Hills Village opened in February, adding 102 rooms to the market, the first opening in Sydney city in over a year. 

There are currently five hotels under construction in Sydney’s CBD and fringe suburbs, set to add 1,071 new rooms, or 4.9%, to existing stock.

Here’s more from JLL:

Since 2020, Sydney has seen 2,373 rooms added to the market, which represents a 10.9% increase in total room stock. However, the supply cycle continues to moderate, and once the final projects complete, the market will have a 15.8% total supply increase over 2019.

Strong trading performance continues through the first quarter

Sydney hotels continued to record positive trading metrics, evidenced by a y-o-y growth in occupancy and RevPAR (yet with softer ADR). Major events such as the NYE Fireworks and Vivid Sydney continue to drive strong hotel performance, with RevPAR exceeding 2019 levels.

Transaction volumes totalled AUD 452.5 million in 2024, below long-term averages and a result of limited institutional-grade assets coming to market. Sales volumes in Q1 totalled $273.5 million; notably the Sir Stamford Circular Quay sold for residential conversion.

Outlook: Further growth for Sydney hotels anticipated in 2025

It is anticipated that Sydney’s hotel market will continue to experience robust demand growth over 2025. This is supported by a significant events calendar, improving visitation and corporate/MICE returning, resulting in improved occupancies and moderated ADR growth.

As a result of this strong trading growth and positive market outlook, investor appetite and interest for Sydney hotels remains high, with annual transaction volumes heavily reliant on the opportunities that come to market this year.