Work starts on Bundaberg's first hotel development in 20 years

It has taken two decades, but Bundaberg's next hotel development is underway.

Four hours north of Brisbane, the city is a key tourism destination for the southern Great Barrier Reef but has not attracted significant short-term accommodation development in 20 years, according to Bundaberg Regional Council.

The 4.5-star, three-storey hotel, situated across the road from the Bundaberg Airport, will offer 97 rooms.

Mayor Helen Blackburn said the demand for accommodation was constantly growing.

"The hotel demand study showed us that we were 800 beds short every night in our region," she said.

"This is just one step towards bridging that gap."

Cr Blackburn said it had been difficult to attract hotel developers to the region due to the current stock of aging motels.

"Those older motels sell their rooms at a cheaper rate, which then doesn't give investors the confidence to think that if they build a new hotel, they can get the price for the rooms that they need," she said.

Developer MVP said the new hotel would refresh the hospitality offering in Bundaberg.

"We hope that it will be a destination of choice for travellers to the region and will bring more travellers to the region," a spokesperson said.

The hotel has been funded by investor MyState Limited, with chief executive Brett Morgan saying the demand was clear.

"Every time you go down the street in Bundaberg, there's no-vacancy signs everywhere," he said.

Mr Morgan said the hotel would also create about 50 ongoing jobs.

Hopes for more operators, airlines

Bundaberg Tourism chief executive Duncan Littler said the development would cater to leisure and business travellers.

"Already, there's more than 750,000 people that choose to visit the beautiful Bundaberg region each year and they stay for more than 2 million nights," he said.

"We hope that investments like this will also encourage other [tourism] operators, potentially even airlines, to consider investing in the region."

Cr Blackburn said other accommodation applications were in the pipeline but did not elaborate.

"We have definitely been encouraging accommodation providers in terms of hotels, student accommodation and even aged care accommodation to set up in our region because we know that we need that here," she said.

Construction on the Airport Drive hotel is due to finish by mid-2027, with the first guests expected later next year.