Government identifies hotel opportunities for investors in New Zealand tourism

New Zealand needs an extra 26 hotels - above what is currently planned over the next 10 years to accommodate the rising number of tourists, the government announced Tuesday as part of a scheme to attract more investment in the tourism sector.

The research commissioned by government agencies was the first quantified data on the effect of tourism growth projections on hotel occupancy, Economic Development Minister Steven Joyce said.

"This research will be a great help to private investors considering when and where to invest in New Zealand's fast-growing tourism accommodation industry," Joyce said in a statement.

The research was a key part of "Project Palace," a program to accelerate new private sector investment in New Zealand's hotel infrastructure.

"The Project Palace work will help match make investors with opportunities, and reduce the time taken to fill information gaps that can slow down investment," said Joyce.

International investors would also be targeted with specific opportunities that highlighted why New Zealand was a prime destination for quality hotel development.

Tourism contributed 11 billion NZ dollars (7.42 billion U.S. dollars) or almost 5 percent to New Zealand's gross domestic product, he said.

International visitor arrivals were expected to grow 5.4 percent a year with China and Australia expected to be largest contributors.

The Tourism Industry Aotearoa (TIA) industry group said it would be challenging to attract investors despite the opportunities.

"The ability to deliver additional hotels is heavily dependent on managing a number of constraints, including financial feasibility, site availability, resource and building costs, finance and timing delays," TIA chief executive Chris Roberts said in a statement. Endit