About 4500 hotel rooms will be added to the market over the next four years if the 23 projects with a hotel component being monitored by Melbourne City Council come to fruition.

The surge in supply suggests Melbourne may overtake Sydney as the leading occupancy provider in Australia within a relatively short time.

Sydney has 20,000 hotel rooms, about 1000 fewer than it had 14 years ago.

By contrast, Melbourne added 4200 rooms over the past decade, taking its total to 18,840, according to Jones Lang LaSalle's July register. Another 4500 would push it past its northern neighbour.

Only 75 per cent of all rooms tracked by JLL were expected to be completed, head of hotel research Karen Wales said.

"The chances of them all proceeding, I would say, are pretty slim," Ms Wales said.

Feasibility challenges, planning hitches and other issues will affect delivery with some already hitting hurdles.

Jinshan Investments' proposal for a 50-metre tall luxury W-Hotel on the Palace Theatre site were scuttled in June by Victorian Planning Minister Matthew Guy over height concerns in the Bourke Hill heritage precinct.

Other proposed projects have also sparked heritage concerns in the city.

AXF Property Group gained approval for a 70-level, mixed-use building with 200 hotel rooms at 180 Russell Street that will see it demolish one of the city's earliest examples of Brutalist architecture, the Total Car Park.

The Windsor and W-Hotel, as well as other proposed projects at 150 Flinders Street, 97 Franklin Street, 95 Flinders Lane, 180 Russell Street, 63 Exhibition Street and 80 Collins Street, will add about 1577 rooms to the eastern end of the CBD.

Developers may be looking to capitalise on a recent surge in tourist numbers which, midway through this year, pushed hotel occupancy in Sydney and Melbourne close to 90 per cent, at or near capacity several nights a week, according to Deloitte Access Economics.

Room rates and RevPAR (revenue per available room) were growing at twice their decade average, Deloitte's Tourism and Hotel Market Outlook said.

The closure of the Sydney Convention and Exhibition Centre to make way for a new space opening in 2016 in Darling Harbour has boosted Melbourne's accommodation sector.

The Melbourne Convention and Exhibition Centre had its most successful month in history in August, hosting more than 100 events with 87,600 delegates and turning away 19.5 per cent of new business due to lack of available space.

Keeping pace with the convention centre are a number of proposed projects in Southbank where the development monitor lists close to 1000 rooms at 168 and 334 City Road, 1-7 Queens Bridge Street and 70 Southbank Boulevard.

The city's west will also see a significant surge of nine projects and 1756 rooms.

An influx of Asian-based developers who favour mixed-use projects with the brand cache of a hotel may affect the supply mix.

Slow sales in residential buildings may result in more hotel rooms.

"If they are unable to sell as residential, those apartments would flip into short-stay stock," Ms Wales said.

The latest Hotels.com index put Melbourne's average room rate at $172.