A new Pullman hotel will open in Sydney as part of the planned $100 million development in Mascot, near the airport, that will include retail and offices.
Goodman Group is developing the O'Riordan Street site, in one of the biggest mixed-use projects in the area for some years. Accor will mange the new five-star hotel as part of the expansion of its Pullman chain.
The deal comes hot on the heels of the NSW government's plans to build a freeway from Sydney Airport to the south as part of a $20 billion infrastructure strategy.
Accor Pacific chief operating officer Simon McGrath said the project would be a key development for Sydney, and workers and residents near the airport.
He said the key driver was the forecast growth in domestic and international tourism and also the rise in use of retail offerings near airports.
"It's not just about travelling, but also people who work and live in the area, where apartment blocks are replacing offices and warehouses in South Sydney," Mr McGrath said.
"Airports are no longer considered transport hubs; they are transforming into complete entities where hotels, conference centres, retail and office spaces co-exist."
Colliers International's head of retail, Michael Bate, said airports and other less traditional shopping areas were gaining traction from consumers.
"As we all become increasingly busier and time poor in today's fast-paced world, the rise of retail services in those places we need to spend time is inevitable," Mr Bate said.
While a 600-room-plus Sofitel brand hotel is being built at Darling Harbour by Jerry Schwartz, there have not been many higher-starred hotels opening in the airport area for many years.
"The Sydney hotel market has been considerably constrained over the past two years with occupancies idling between 80 and 90 per cent; hence the urgency for new inventory to service the high corporate and leisure demand in the city," Mr McGrath said.
"Pullman Sydney Airport will not only add 229 rooms to Sydney's burgeoning tourism economy, but it will be the first internationally branded five-star hotel serving the international airport precinct."
Goodman's general manager Australia, Jason Little, said the new mixed-use precinct would provide the highest and best use for the prominent South Sydney site and would complement the approved development of two commercial office buildings, totalling 34,350 square metres, together with ground floor retail space.
Mr Little said construction was under way and the hotel was forecast to open in May 2016.
