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Transcript of Feasibility Report
Thank You! Feasibility Report ---- Development of Tune Hotel in Melbourne Ying Luo S3863586
Ao Zhang S3845654
Wenjie Zhao S3817457
Yiling Koh S3849145 Overview Introduction
Discussion Conclusion Current Supply and Demand Levels
Future Supply and Demand Levels
Analysis of forecast business environment
Occupancy and Room Rate projections
Recommendation for Investor Introduction Proposed site:
602 little Bourke Street, Melbourne City Hotel :
Tune Hotel From Malaysia Building: Seven levels
4,557 Square meters of floor space
Managed by Art and Heritage Collection and Business Information Service
Available in 2013 Current Supply and Demand Levels Supply Hotel property market performed increasingly active Strong accelerating phase According to Service of Accommodation (2011) Rooms available of Melbourne added 537 to 26594
Total room nights occupied increased 2.9% to 1.8 million from 2010 to 2011 Occupancy rates added 0.6% to 75.2% Demand Three main types hotel:
luxury hotel, express hotel and backpacker hotel Express hotel and backpacker in huge demand The average occupancy rates grow from 70.45%(2002)to 75.80% (2011) Tune Hotel Relative Competitiveness: Operation and Market strategy Limit Service Offer: pools, spas, saunas, room service Concentrated on : Good night’s Rest 5-star beds
central and convenient locations
24-hour security Future Supply and Demand Levels Many site on leased/sales
No significant proposed development nearby
Steady growth in next 5 years under expectation
2012-2013: moderate economic growth
2013-2014: domestic economic activity remains moderate
10 Years Strategy by Tourism Victoria Proposed Product Tune Hotel on Little Bourke Street Franchise of Tune Hotels
Budget hotel (between backpacker & lower stars)
budget traveler (room=hot shower+good rest)
Lowest room price (getting rid of costly full services) 170 Guest Rooms 57 Double Room
110 Twin Room
3 Accessible Room Just bed and shower (air-conditioned & basic bed amenities)
Room needs available with extra charges
Tourist information counter Site Evaluation Transportation Train
(Southern Cross station, V-line, bus)
Tram Shopping Directly Factory Outlets
Queen Victoria Market
Melbourne central Dining Yarra River
Lygon Street Forecast Business Environment Economic Environment Overview
Major source markets - Global Economy is a trend of growth - Australia's economy is recovering strongly
- There is a boost of domestic demand through increasing income
- Australian dollars is at its highest level against US dollar - United States, China
- GDP is growing Tourism Industry Environment Tourism in Australia has been developing strongly
The arrivals of short-term visitor has a increased trend
Hotels, motels and serviced apartments' room occupancy rate has increased Political and Legal Environment Australia is the safest place to invest
Australia's low level of political, external, economic and commercial uncertainty. Occupancy and Room Rate Projections Financial Study Recommendation for Investors •This project is a good investment choice with low risk and high market competitiveness.
•Redeveloping the old building would bring a long-term benefit
•The customer would be benefit from the co-location
•Tune Hotel would get broader change and stimulate the business confidence. Questions? Reference: IBISWorld 2012, IBISWorld Industry Report H5711: Hotels and Resorts in Australia, IBISWorld Industry Report, Melbourne, viewed 24 September 2012, <https://ce6.vu.edu.au/webct/urw/lc9140001.tp0/cobaltMainFrame.dowebct>.
Tourism Victoria 2006, 10 Year Tourism and Events Industry Strategy, State of Victoria, Victorian Government, Department of Innovation, Industry and Regional Development, Melbourne, viewed 24 September 2012, <http://www.tourism.vic.gov.au/images/stories/10yearstrat.pdf>.
Tune Hotels 2012, Tune Hotels, viewed 22 September 2012, <http://www.tunehotels.com>. 2014 2025 Conclusion eg. Wi-fi, toiletries & towels, in room safe, room service