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Amidst an influx of Chinese visitors, hoteliers have embarked on their largest expansion ever, with plans to construct approximately 120 hotels in Australia between 2017 and 2021, reported Bloomberg, citing data from Tourism Accommodation Australia.
“I have no hesitation at all to build new rooms,” said Jerry Schwartz, who will open a 590-room hotel in Sydney next September under the AccorHotel’s Sofitel brand.
Touted as the city’s biggest new hotel development since the 2000 Sydney Olympics, the property was purchased from Lendlease for A$360 million in 2014, and is located along Darling Harbour, a popular tourist site.
Other companies with upcoming hotels include Marriott, Starwood, Australia-based Crown Resorts, Intercontinental Hotels and Hong Kong’s Far East Consortium.
As such, there is now a construction boom of hotels, with the value of approved construction work for such properties peaking at A$2.8 billion in Q4 2016. Deloitte Access Economics also estimated that the overall value of tourism-related developments has reached A$20 billion at present.
Attracted by cheaper airfares and the weaker Australian dollar, the number of Chinese visiting the country is growing at double the rate of the tourism industry, and has surpassed the total spending of American nationals by three times.
Based on government statistics, Chinese arrivals tripled to one million in the 10 years to June 2016, while their expenditure surged by over six-fold to A$6.6 billion. At the same time, the number of wealthy Chinese spending A$4,200 or more has been steadily rising.
Consequently, the average room occupancy of hotels and motels in Australia reached a record high of nearly 67 percent in Q4 2016. In particular, the rate in Sydney and Melbourne is as high as 90 percent.
Romesh Navaratnarajah, Senior Editor at PropertyGuru, edited this story. To contact him about this or other stories, email romesh@propertyguru.com.sg
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