Asia-Pacific leg of Taylor Swift’s Eras tour: Increased demand and hotel room rates down under

Probably not, as she's now heading off to Asia to deliver her 'Eras Tour' to her dedicated fanbase there. And as she gears up for her shows down under, the local hotel market looks set to hit its own high note as prices in Australia soar.

What you need to know

• Hotel occupancy is over 80% across all Asia-Pacific stops in the Eras Tour currently.

• Hotel price surging in Australia, as Melbourne and Sydney see peak weekend price growth of 161% and 91% compared to week prior.

• Swifties appear to be favoring hotels over short-term rentals in Asia-Pacific, with occupancy and pricing trailing that of hotel rooms.

Hotels close to sold out in almost every Swift stop in Asia-Pacific

After a mammoth pair of North and South America legs, Taylor Swift is bringing the Eras Tour to Asia-Pacific and the results seem no less impressive for the hospitality industry.

Hotels are nearing sell out conditions in Melbourne, Sydney, and Singapore, while Tokyo is posting extremely high booking levels considering it is a massive metro market in the off season.

Only a little over 10% of room stock is still available at the time of writing (8th February 2024) in Melbourne and Sydney, while 17% of rooms are still on the market in Singapore, and Tokyo is pushing 90% occupancy.

This is not some statistical quirk or the result of some other demand catalyst: this is the Swift effect in full force.

Occupancies are up considerably compared to surrounding weekends, and this becomes more pronounced the further into the future the concerts are being held.

This is most obvious in Singapore, where Swift is performing a grueling six nights in a seven-day period from March 2nd to March 9th. This has created a double spike over the course of the period, with clear On-the-books (OTB) lows on days when Swift is not performing and occupancy 30% higher during her concerts compared to the week after she departs.

Looking at our chart for unavailable hotels, the uniqueness of the Eras Tour as a demand driver is even more immediately obvious. There are peaks that coincide exactly with the performances, ranging from 40% of hotels listed as unavailable in Singapore to 77% in Tokyo.

The only other point of extremely low availability in the remainder of Q1 across these destinations is the Australian Grand Prix. This is being held in Melbourne on 23rd-24th March where unavailability reaches 78% and OTB occupancy 76%.

For comparison to the Eras Tour, this is one of the world’s largest sporting events, drawing cumulative attendances not far from half a million, making it the most attended event in the F1 calendar, which is also the highest globally attended sport in the world.

This puts Swift in extremely rarified company.

Short-term rentals, meanwhile, lag noticeably behind in terms of occupancy, with a 7-percentage-point drop in occupancy in Tokyo, followed by 8% in Melbourne and 15% in Sydney. These remain impressive figures nonetheless and the pattern of peaks relatively closely matches those in the hotel sector.

Note we have not included short-term rental information on Singapore here, as local laws restrict short-term lets and therefore the market is extremely small.

A big bump in Q1 hotel prices across Asia-Pacific tour stops

This level of consumer demand can only cause prices to go one way - and that’s up!

We are seeing significant spikes in rates for an average hotel room, but the level of variability does depend on the supply and demand dynamics, with more aggressive pricing in Australia, where the overall number of rooms in Melbourne and Sydney is smaller than in Tokyo or Singapore.

Compared to the following weekend, peak advertised room pricing at the time of writing is:

• 30% higher in Tokyo.

• 84% higher in Melbourne.

• 87% higher in Sydney.

• 22% higher in Singapore, however, this is also a Swift concert date, so these two Saturday peaks are 71% and 40% above the following weekend for more direct comparison.

In the case of Melbourne the change is even more stratospheric comparing prices to the weekend prior to Swift’s arrival - this positive change is a huge increase of 161%.

We’re not the only ones calling this a major revenue generating event either. According to Japanese researcher and academic, Mitsumasa Etou, the tour represents the biggest musical event ever held in Japan and he estimates it will generate $230 million for the city.

Even the Reserve Bank of Australia Governor has commented, noting that it could push up Australia’s pricing indices, calling it potential “Taylor Swift inflation”.

Short-term rental properties see milder price increases

One quirk we are seeing in the accommodation market space is that holiday lets are not seeing the same jumps in prices than for hotels.

Using the same comparison as we have done above, advertised prices for short-term rentals are up a more modest 6% in Tokyo, 60% in Melbourne, and 30% in Sydney. Once again, we are not looking at Singapore here given the size of the market.

Potentially, this could be down to the relative attractiveness of these properties for these events, the potential clientele and the fact that these short-term rental markets are less developed than in Europe or North America, meaning they could be less attractive to consumers.

In terms of the first potential driver of this trend, rentals are generally not as favorably located and are going to have much less capacity.

Looking at Melbourne for example, the area near the MCG, where the concert will be held, is packed with hotels within public transport or walkable distance. This applies to the CBD district, which is the touristic and cultural heart of the city. It is home to nearly 150 hotels, such as the nearly 500-room Crown Towers or the Grand Hyatt, which has more than 500 rooms.

These are premium properties, with premium locations that can command premium prices for a large volume of rooms, pushing up the relative prices change for this kind of event in hotels' favor.

Concert-goers are also probably looking to splash out given the high cost of tickets and to attend. This may make them more disposed to booking hotels, especially given the higher end of the geographically relevant short-term rental market most likely sold out well in advance.

Finally, these are relatively small markets compared to somewhere like London or LA, and while constrained supply usually means higher prices, the low number of properties available may mean some travelers have skipped them as an option altogether.

Whatever the case, it appears hotels in Asia-Pacific are going to be benefiting most and can look forward to a more than healthy boost from the Eras Tour.