Perth-based developer Sunfire Asset has enlisted InterContinental Hotels Group (IHG) to manage Australia’s first Holiday Inn Express hotel in the Perth CBD. 

The 224 room hotel will be located at 257 Adelaide Terrace, and it will span 20 floors and incorporate an 1888 heritage house.

Construction of the $35 million development is set to commence by mid-2013, and Sunfire Asset aims to complete the project by early 2015.

The hotel will offer a “Grab & Go” style breakfast, meeting spaces, complimentary Wi-Fi and laundry facilities.

Ralph Nunis of Sunfire Development said the Holiday Express model will suit the Perth market quite well.

“There is real investment potential in Perth hotels at the moment, with the mining capital of Australia experiencing soaring room rates and a shortage of guest rooms.

“The CBD hasn’t seen a new hotel build for more than a decade, so we’re delighted to be working towards a solution for both business and leisure travellers to the city.”  

He said the hotel will be able to offer guests affordable room rates by virtue of its business model.

“Once open, the Holiday Inn Express business model also means we will be able to keep operational costs down and room rates at affordable levels, while meeting the highly competitive demands of the market for comfort, convenience and value.”

Phil Kasselis, head of development, Australasia for IHG, said the hotel will offer a sound investment, particularly in a climate where it can be difficult to achieve adequate returns from new hotels.

“Holiday Inn Express’ efficient design and a modular, no frills approach represents a more rapid build proposition than an upscale or luxury hotel, and meets the need for an affordable alternative to full service hotels.

“It’s also a lower cost and higher yield model, which presents a faster road to profitability for owners,” he said.

Trent Zimmerman, acting chief executive officer, Tourism & Transport Forum said accommodation plays an important role in the city’s ability to attract tourists.    

“As one of Australia’s gateway cities, it is vital that visitors to Perth can access suitable and affordable accommodation,” Zimmerman said.

According to the Deloitte Access Economics Tourism and Hotel Market Outlook report Q4 2012, Perth is in need of more hotel rooms.

In December 2012 occupancy rates in the city’s CBD were 85.1 percent, and this figure is set to rise to 88.2 percent by the end of June 2015.