IHG signs 190 rooms across Tamworth and Rockhampton

By Marcus Bennett

IHG Hotels and Resorts has signed two regional Holiday Inn projects that will deliver a combined 190 rooms by 2030, with La Vie Hotels and Resorts named to operate both properties.

The room count is the hardest disclosed project measure. The source gives no development budget, forecast occupancy, average daily rate, operating margin, labor cost, expected return, ownership split, franchise terms or management fees.

What are IHG and La Vie building?

• Tamworth, New South Wales: The project will refurbish the existing 60-room Best Western Sanctuary Inn, including guest rooms, reception and restaurant, by 2027. Construction of a 30-room extension follows by 2029, taking the Holiday Inn property to 90 rooms.
• Rockhampton, Queensland: A new-build, 100-key Holiday Inn and Suites will form part of a mixed-use precinct and is estimated to open in 2030. It includes 350 square metres of conference and events space, a 100-seat function room and an outdoor swimming pool.

Why is IHG moving beyond gateway cities?

Cameron Burke, IHG Director of Development Australasia and Pacific, said fewer development opportunities in gateway cities have pushed more sophisticated capital toward regional markets. Lower entry barriers, acquisition and repositioning options, and potential value creation now attract that capital.

Burke said: “Many of these markets are underpinned by a diverse mix of defensive demand drivers spanning corporate, government, infrastructure, resources and leisure.” He argues that mix gives owners resilience through economic cycles and a broader base of year-round demand. The announcement offers no occupancy series to test that claim.

Burke says IHG will remain selective, backing markets with strong fundamentals and genuine gaps in quality branded accommodation. IHG has recently opened or announced hotels in Townsville, Darwin, Rockhampton, Tamworth and Cockburn.

What demand supports each hotel?

Rockhampton draws year-round corporate demand from mining and agriculture but remains underrepresented by globally recognized brands. Tamworth is an established regional business centre with a significant events calendar and domestic appeal, yet also lacks recognized international brands.

IHG sees room for its brand, global distribution network and IHG One Rewards to capture existing travel. It also expects those systems to attract brand-conscious domestic and international guests.

Burke said One Rewards contributes approximately 60% of room nights across IHG hotels globally. That global figure does not establish the likely loyalty contribution in either regional market. He also cited corporate accounts generated by IHG’s national sales team and direct booking channels. Independent regional hotels, he said, have less ability to build awareness and capture demand.

Why do conversions matter now?

Flexibility has become critical. New builds allow design from the ground up, while conversions can unlock the potential of existing assets. Adaptive reuse can impose different floor plates, structural grids and building services. IHG treats conversion of an existing hotel as another proposition, assessing the property’s strengths, repositioning options and investment priorities.

IHG says it balances capital spending, operational efficiency and brand standards to produce a commercially viable hotel for owners and guests. It also prioritizes spending where it can most affect guest experience and hotel performance. Owners still require confidence in operating performance and returns. Over the past 12 to 18 months, they have tested that confidence more rigorously.

Investment appetite remains healthy, but capital has become selective as construction and financing costs stay elevated. Capital efficiency, speed to market, the critical path to opening and achievable returns now carry more weight, strengthening interest in conversions.

Where can costs break the case?

Construction costs and development feasibility remain major barriers. For conversions, fire and life safety compliance is often a key issue. A property may meet regulations from its original development without meeting current guest expectations or IHG brand standards. IHG says closing that gap early can materially change the capital needed for repositioning.

The locally based technical services team identifies constraints and mitigates risk before owners commit capital. Burke said: “An asset may look compelling from an acquisition perspective, but the real measure of the opportunity is the all-in investment required to convert, reposition and operate it successfully.” The source does not quantify compliance work or all-in costs for either signing.

What does the regional pipeline show?

Tamworth and Rockhampton show that IHG’s regional plan does not rely on one delivery model. Both markets have established economies and potential for international brands.

Rockhampton is designed around local characteristics and demand. IHG attributes its approach to years of scale, maturity and local expertise in Australia and New Zealand. As its portfolio has grown, the group says it understands better where guests already travel. Close-to-market knowledge works with global distribution, loyalty and commercial systems.

The aim is a hotel that reflects its community while giving owners access to a global network. IHG’s market analysis has identified further opportunities in Australia and New Zealand:

• Australia: Bendigo, Ballarat, Dubbo and Cairns.
• New Zealand: Rotorua, Hamilton, Napier and Nelson.

These remain prospects, not announced signings. The next test is whether regional projects can earn acceptable returns despite elevated construction and financing costs while meeting IHG’s safety and brand standards.