Australian Tourism Open for Investment - JANUARY 2017 - Austrade
←
→
Page content transcription
If your browser does not render page correctly, please read the page content below
Australian Tourism Open for Investment JANUARY 2017 www.tourisminvestment.com.au
“Investors recognise that the southern hemisphere is where the hotel
growth is and what better place to invest than in Australia, which has
good corporate governance, good planning controls and is a well-
Australia’s economy ranks
regulated and mature market with good underlying economy?”4
13th largest in the Ron Barrott, Chief Executive Officer, Pro-invest Group
world and is in its 26th
year of consecutive annual
economic growth.1
Australia’s Economic Fundamentals
Tourism Industry Fundamentals Strong Aviation Growth
International aviation capacity to Australia
What is the tourism industry worth?
grew nine per cent in the 12 months to
>> A
$117.9 billion in year ending September September 2016. Markets which registered
2016 (inbound A$38.8 billion/ domestic significant capacity growth included Japan
A$79.1 billion) generating A$52.9 billion (+21 per cent), China (+37 per cent), USA
in direct GDP5 (+7 per cent) and Qatar (+52 per cent).11
Australia is the only major >> 8
.1 million international visitors in year >> O
n 5 December 2016, Australia and China
ending September 2016, increasing by
developed economy to have 11 per cent from the previous period6
settled arrangements for a landmark
open aviation market between the
recorded no
annual >> Directly employs over 580,000 people7 two countries. Both Governments have
removed all capacity restrictions from the
recessions from Globally, Australia is…
>> 42nd for visitor arrivals
China-Australia air services arrangements,
which will pave the way to further
1992 to 2016. 2
>> 11th for tourism receipts
strengthen the bilateral relationship
and provide boundless opportunities for
>> 1st for spend per visitor8 Australian tourism and trade.
>> F or the year ending September 2016, direct
capacity to Australia from China increased
37 per cent. Recent new China-Australia
Visitor Numbers air routes include: Beijing Capital Airlines,
Fifteen of Australia’s top 20 major source Shenyang-Qingdao-Melbourne in
markets grew to record levels in the year September 2016; Hainan Airlines,
ending September 2016, with increased Changsha-Melbourne and Xi’an-
ustralia has the 4th
A aviation capacity playing a role in the strong
growth. Arrivals from South Korea increased
Melbourne in November 2016; Air China,
Chengdu-Sydney in November 2016;
largest GDP in the 28 per cent and Japanese visitation grew 20
per cent. Arrivals from China continued to
China Eastern, Beijing-Hangzhou-Sydney,
Kunming-Sydney in November 2016 and
Shanghai-Brisbane in December 2016;and,
Asia-Pacific region. grow at a blistering pace, up 21 per cent over
the same period. North America also recorded
China Southern, Guangzhou-Adelaide in
December 2016.
healthy growth with arrivals from the USA up >> S
ingapore Airlines commenced four weekly
The Australian economy is 18 per cent, and Canada up 2 per cent in the Singapore-Canberra-Wellington return
last 12 months.9 services on 20 September 2016. The new
forecast to have average >> A
verage annual growth for inbound ‘Capital Express’ service marks Canberra’s
arrivals is forecast at an average of first international flights.
annual real GDP growth of 5.6 per cent over the next decade to >> E
xpansion of air services between Middle
East and Australia have opened up further
2.9 per cent between 2017 2024-25.
opportunities for carriers of both countries.
>> V
isitor numbers from China are forecast
and 20213 to contribute to almost half (43 per cent)
Qatar Airways has confirmed plans to start
daily services from Doha-Sydney (March
of total growth over the forecast period to 2016) and Doha-Adelaide (May 2016).
2024-25. China is also set to become the
>> A
viation capacity from Japan has had a
Australia has a transparent largest source market of both inbound boost, with direct capacity to Australia
and stable operating
arrivals and expenditure by 2017-18, from Japan increasing by 12 percent for
overtaking New Zealand. the year ending September 2016. Qantas
environment with a strong, >> B
y 2024-25, about 67 per cent of growth
in inbound visitation will be driven by New
began daily flights from Narita to Brisbane
in August 2015, and commenced daily
Tokyo-Melbourne flights in December
sophisticated and well-developed Zealand, China, the United Kingdom, the
2016. Air Nippon Airways has also returned
United States and Singapore.10
financial services industry. to Australia, launching daily Haneda-
Sydney service from December 2015. The
airline has also announced that it will
consider expanding to other destinations
like Melbourne and Perth in the future.12
Heart2Reef, Great Barrier
Australian TourismReef,
Open Queensland
For Investment Australian Tourism Open For Investment 3
“All the boxes are ticked from an investment perspective
with steady growth in returns, capital appreciation and
Overview and Outlook
safety of investments.”15
Akshay Kulkarni Director for Asia Pacific CBRE Hotels
Strong core fundamentals continue to underpin record capital inflows to the Australian hotel sector. Australian Hotel Outlook Record performance of the Australian
75% $200
accommodation sector
Deloitte Access Economics reported that Australian
Deloitte Access Economics’
70% $160
hotels have continued their positive run into the
2016 calendar year. Occupancies (OCC%) added half
Lachlan Smirl said “The gap 65% $120
a percentage point to reach 68.7 per cent in June and
between supply and demand 60% $80 Average Daily Rates (ADR) grew by 2 per cent to reach
$162 (excl. GST). These growth figures are just below
projections remains unbridged. 55% $40 10 year averages.16
An improved demand outlook 50% $0 Australia’s major hotel markets are expected
sees demand set to grow at to continue to outperform with Jones Lang
Jun-02
Dec-02
Jun-03
Dec-03
Jun-04
Dec-04
Jun-05
Dec-05
Jun-06
Dec-06
Jun-07
Dec-07
Jun-08
Dec-08
Jun-09
Dec-09
Jun-10
Dec-10
Jun-11
Dec-11
Jun-12
Dec-12
Jun-13
Dec-13
Jun-14
Dec-14
Jun-15
Dec-15
Jun-16
Dec-16
Jun-17
Dec-17
Jun-18
Dec-18
Jun-19
LaSalle reporting that Investors’ hotel operating
twice the pace of supply over Room Occ% trend (LHS) Room Rate trend (RHS) RevPAR trend (RHS)
performance expectations for Sydney and
the period to end-2018 and Source: Deloitte Access Economics based on: ABS Small Area
Melbourne are amongst the highest in Asia Pacific
for the short and medium term.17
occupancies are projected to Accommodation data and STR Global. Rates are exclusive of GST.
climb two percentage points to Revenue Per Available Room (RevPAR) YTD November 2015 vs November 2016 (A$)
RevPAR on the rise
72% by 2018.”13 200
Both capital city and leisure accommodation
Source: Colliers International
markets have seen high occupancies for the year
Colliers reported Australia’s hotel sales activity 150 to date November 2016. Sydney, Melbourne, Cairns
for 2016 (at end October) had exceeded A$2.2 Leisure destinations on the rise and Hobart had results of over 80 per cent.
billion. Although down from the 2015 record of Reduced opportunities in capital city markets and strong
A$3.8 billion, there are a number of deals in the 100 This demand, driven by strong market
visitor growth in regional areas are seeing Australia’s
pipeline which will suggest 2016 will match 2014 fundamentals, has significantly improved the hotel
leisure destinations feature prominently as a market
levels at around A$2.6 billion. Last year was also sector’s Revenue Per Available Room (RevPAR) in
entry option for investors.
another strong year for transaction activity, with
50
recent years and is expected to continue to rise,
interest from sovereign wealth funds and global Research from CBRE in August 2016 confirms this shift with a projected growth of 4.8 per cent per year
institutional investors.14 towards regional assets: 43 per cent of the 37 deals done in to December 2018 – a pace slightly faster than
0
2016 were in regional areas, in terms of value this represents historically observed.18
Sydney
Melbourne
Perth
Canberra & ACT
Adelaide
Cairns
Brisbane
Darwin
Hobart
Gold Coast
31 per cent of the $1.3 billion spent so far this year.
Cairns and the Gold Coast have seen much of the 2015 2016
action, with the Tradewinds Cairns, the Novotel Cairns,
Surfers Paradise Marriott and Vibe Surfers Paradise all Source: STR Global
transacting so far in 2016.
It is a compelling value proposition, benign supply
outlook and the strong tourist volumes, prompting both Where the growth will come from
Where the growth will come from
local and overseas players to secure assets in these iconic
12000 Demand from Asia will play a key role in achieving
leisure destinations.
the growth in international visitation to Australia.
10000
Asia is the fastest growing tourism market in the
8000 world. It is driven by strong economic growth, a
growing urban and affluent middle class and the
6000 fastest growing aviation sector in the world.
4000 Asian markets are expected to continue driving
growth in the next few years led by China (up 18.5
2000
per cent in 2016–17 and 13.3 per cent in 2017–
0 18) and India (up 9.4 per cent and 9.7 per cent,
respectively). In terms of visitor numbers, China is
9
0
1
2
3
4
5
6
7
8
9
0
1
2
3
4
5
-0
-1
-1
-1
-1
-1
-1
-1
-1
-1
-1
-2
-2
-2
-2
-2
-2
08
09
10
11
12
13
14
15
16
17
18
19
20
21
22
23
24
20
20
20
20
20
20
20
20
20
20
20
20
20
20
20
20
20
expected to contribute 43 per cent of total growth
China Rest of Asia NZ North America UK/Europe Others
from 2014–15 to 2024–25 and 60 per cent in
terms of expenditure.19
Source: Tourism Research Australia
Twelve Apostles, Great Ocean Road, Victoria Australian Tourism Open For Investment 5
Snapshot Of Investment Recent News & Developments
opportunities
Our investment specialists can talk to you about a range of investment-ready ICC Sydney open and ready In the first nine months of 2016 there
has been about $1.7 billion of hotel
and proposed projects across Australia, including: for business transactions. High occupancy rates, a
The jewel in the crown of the $3.4 billion benign supply outlook and increased air
transformation of Darling Harbour, the capacity from new markets like China and
The Bays Precinct, Sydney NSW Gold Coast Theme Park Resort and $1.5 billion International Convention India characterise a positive outlook.
Hotel Development Centre (ICC) Sydney, was opened to the
Located in Sydney’s inner harbour, just two In addition, the growth in white collar
This is a rare opportunity to invest, on a public by NSW Premier Mike Baird in
kilometres west of Sydney’s central business worker numbers within our CBDs is
fund-through basis, in the proposed Village December 2016.
district, The Bays Precinct represents a huge fuelling office growth and therefore
potential transformation opportunity in Roadshow Resort & Hotel at the Warner Bros. “The ICC Sydney sets a new standard for strong corporate demand for hotels.21
Australia. The area includes 80 hectares Movie World theme park on the Gold Coast. convention and exhibition venues,”
(200 acres) of government owned land,
Due for completion in 2019, this contemporary
Mr Baird said. Hamilton Island record
surrounding three bays within Sydney Harbour.
It encompasses the Sydney Fish Market and
designed four star resort will offer 400 guest “The mega space will employ 300 performance
rooms and suites along with a restaurant, full-time staff and 1500 casual workers,
disused White Bay Power Station. It will be and is expected to pump at least Queensland resort Hamilton Island
cafe and bar, multipurpose function facilities,
similar in significance to projects such as the $5 billion into the NSW economy over the announced that it has achieved its highest
business centre, kids club, gymnasium, and
Battersea Power Station (UK), the Kings Cross next 25 years.” hotel occupancy levels on record of 93.2%,
extensive pool area.
Station regeneration project (UK), the Toronto representing an 8% increase on 2015.
The Hotel is set to capitalise on the five million International Convention Centre Sydney
Waterfront and Hudson Yards projects in North
(ICC Sydney), sits at the heart of a broader The Island also reported a 15% increase
America. More information can be found at visitors a year currently visiting the property.
revitalisation of Darling Harbour that will in annual room revenue on the back of
www.transformingthebays.com.au
also include a new 590-room hotel, room nights sold, which were up by 11%
“There are three
a new urban neighbourhood with offices, on 2015.
Great Keppel Island Resort Key Considerations
residential, student housing, public car characteristics of
Hamilton Island CEO Glenn Bourke
This fully integrated resort and villa parking, cafes and shops.20
stated “Hamilton Island’s results have
Australia that make
Record performance of Australia’s
development is located on the iconic Great
accommodation sector Stars align for the been underpinned by three things: investing here
Keppel Island, which is nestled within the
world-renowned Great Barrier Reef. Boasting hotels sector
the multi-million dollar reinvestment attractive: being the
Overseas investors are already strategy to keep the Island’s offering
17 pristine white sandy beaches and
Australia’s hotel market, particularly in the updated and fresh; the lower Australian
stable economy,
highly active in the Australian
surrounded by stunning coral reefs, the Island
market global cities of Sydney and Melbourne, is dollar; and healthy competition among strong underlying
presents a rare and unique opportunity to
create an integrated development like no other
experiencing an unprecedented alignment Australian’s airlines, bringing more guests fundamentals of the
trong visitor growth from Asia
S of positive fundamental indicators, to the Island.22
in the world. This unrivalled location includes representing some of the best conditions hotel industry and
which is forecast to continue
the largest development approval ever to be
to increase
in the Asia Pacific region. the low dollar, which
issued in the Great Barrier Reef.
attracts overseas
ustralia has one of the
A visitors.”23
world’s most transparent real Dillip Rajakarier, Chief Executive,
estate markets Minor Hotel Group
Demand for accommodation
is forecast to grow at twice the
pace of supply
1. Austrade, Benchmark Report 2017 15. B loomberg, Starwood Capital, Fosun said to consider offers for Ascendas,
2. Austrade, Benchmark Report 2017 29 January 2016
3. Austrade, Benchmark Report 2017 16. D eloitte Access Economics, Tourism and Hotel Market Outlook – The Changing
4. A ustralian Financial Review, International money pouring into Australian hotel
Face of Travel, August 2016
funds, says Ron Barrott, 29 April 2015
17. J ones Lang LaSalle, Hotel Investment Survey, December 2016
5. Tourism Research Australia, 2016 (International Visitor Survey and National Visitor
Survey September 2016 Quarter, Tourism Satellite Account 2015-16) 18. D eloitte Access Economics, Tourism and Hotel Market Outlook – The Changing
6. A ustralian Bureau of Statistics, Overseas Arrivals and Departures October 2016 Face of Travel, August 2016
7. Tourism Research Australia, Tourism Satellite Account 2015-16 19. Tourism Research Australia, Tourism Forecasts 2016
8. United National World Tourism Organisation, Tourism Highlights 2016 20. D estination New South Wales, ICC Sydney open and ready for business,
9. Tourism Australia, International Market Update, December 2016 12 December 2016
10. Tourism Research Australia, Tourism Forecasts 2016
21. Sydney Morning Herald, Stars align for the hotels sector, 23 September 2016
11. Tourism Australia, International Market Update, December 2016
22. A ustralian Leisure Management, Hamilton Island shows record high
12. Tourism Australia, International Market Update, December 2016
13. D eloitte Access Economics, Tourism and Hotel Market Outlook – The Changing performance, 14 August 2016
Face of Travel, August 2016 23. S ydney Morning Herald, Hotel sector hits new highs as Australia accommodates
14. Colliers Australia, Hotels 2016 visitor demand, 31 July 2015
6 Australian Tourism Open For Investment
Wineglass Bay and The Hazards, Freycinet National Park, Tasmania
A NATIONAL PRIORITY
Tourism Australia and the Australian Trade and Investment Commission
(Austrade) have joined forces in a strategic partnership to attract foreign
direct investment to the tourism industry in Australia.
The tourism investment attraction The partnership was formed in response to
partnership is a commitment to making the national long-term tourism strategy,
the process of investment easier - removing Tourism 2020, whereby the Australian and
barriers and making information and insight state and territory governments are working
on Australian tourism opportunities more with industry to double overnight visitor
readily available to interested investors. expenditure to between A$115 billion
and A$140 billion by 2020.
HOW WE CAN HELP
To find out more information about tourism investment opportunities in Australia and
how the Australian Government can assist, contact your local representative by visiting
our website:
www.tourisminvestment.com.au
To contact your local Austrade representative for more information, visit: www.tourisminvestment.com.au
Disclaimer: This document includes information provided by third parties. The information is general in
nature and is for information purposes only. Austrade and Tourism Australia makes no representation
about the veracity or accuracy of information provided by third parties. You must rely on your own due
diligence before proceeding. You should consider seeking independent professional advice.
Cover Image: Stokes Bay, Kangaroo Island, South AustraliaYou can also read
