Snapshot Down Under

Australia is no stranger to tourism. Her iconic wildlife and culture, enviable weather and outdoorsy pursuits provide a constant lure to global travellers.

But according to the Australian Trade and Investment Commission, the tourism industry is set for “supercharged growth” in the next few years, with Asia – and China in particular – set to dominate the inbound market.
As the official Tourism Research Australia forecast shows, Asia-Pacific already accounts for 64 per cent of all visitor growth, with China alone making a 29 per cent contribution.

Statistics also reveal an upturn of foreign business investments by major advanced economies, including the US, Japan, UK and Canada, with an expectation that this will greatly increase the numbers of corporate travellers and MICE activities over the next few years.

Stimulating this growth is a massive increase in air traffic, driven in part by the rise of low-cost carriers, but also by increased services and frequencies from major airlines targeting the rapid development in Australia’s various cities. New runways and terminal facilities are being built across the country to accommodate the burgeoning airline and customer needs.

Huge developments in Australia’s major cities are also underway to increase hotel openings and update facilities such as convention centres and entertainment precincts to satisfy the demand from rising traveller numbers.

Here we give a rundown of the key developments in five of Australia’s main urban centres.

In 2015, the South Australian government reached out to international airlines amid concerns Adelaide Airport was experiencing a slump. The invitation was answered: In December 2016, China Southern Airlines launched a three-times weekly direct service from Guangzhou – the city’s first regular air link to mainland China. According to Australian Aviation this service alone brought a surge in air exports of 37 per cent, valued at A$22 million per year.

Cathay Pacific has also increased services from four to five-weekly, in July 2017, and recently announced this will become a six-times-weekly service from October this year. Malaysia Airlines will also increase frequency to five flights per week in July, while Emirates is hoping to upgauge its Adelaide service by deploying its superjumbo A380 in the near future.

Arguably, Adelaide is most famous for its beautiful vineyards. South Australia produces 80 per cent of Australia’s premium wines in iconic wine regions such as the Adelaide Hills, the Barossa Valley and McLaren Vale. “The main reason people come to the city is wine”, says Nic Mercer, director of sales and marketing at the Adelaide Convention Bureau. “We have 200 cellars within an hour from the city – we are the national wine centre”.

However, Mercer is confident that major investments in the city’s commercial offering will give the city new appeal. “There’s been A$5.6 billion worth of investment into the Riverbank precinct, a huge commercial project in the middle of the city. Once people see this, they’re going to be surprised that for such a small city we have a lot of infrastructure”.

Part of this investment included A$397 million (US$305 million) redevelopment of the city’s convention centre, including construction of two new buildings: one expanding over the railway line to link with Montefiore Bridge; the other replacing the previous plenary hall with a new multipurpose facility of up to 3,500 seats. The Plenary is also home to a spectacular “Starry Night” aerial backdrop, featuring more than 35,000 fibre-optic lights.

A number of entertainment and cultural developments are also being developed, including a A$610 million (US$469 million) redevelopment of Festival Plaza, and revitalised arts, culture and leisure spaces, scheduled for completion in 2020.

In the hotel sector, following the launch of a new Pullman in November last year, Adelaide now boasts more than 6,000 rooms in the central business district. Skycity Casino has received the green light for a A$330 million (US$254 million) expansion, including the construction of the city’s first six-star hotel in 2020. A 250-room Sofitel and will also be opening next year.

Queensland’s major city is also looking forward to plenty of new developments. A new world-class integrated resort development is currently under construction that is being likened to Marina Bay Sands in Singapore – with a Brizzy twist. Expected to open in 2022, Queen’s Wharf Brisbane will have public space the size of 12 football fields, including green parkland, refreshing new river spaces, fitness areas and an outdoor cinema. There will also be a Sky Deck for sunset cocktails, bars, and numerous dining experiences in heritage buildings throughout the precinct.

“The next five years is going to be very exciting for Brisbane”, says Brett Fraser, CEO of Brisbane Marketing. “We’re expecting this project to generate some A$1.5 billion per year once its completed and we’re also expecting it to lead to an increase of 1.3 million tourists annually”.

In anticipation, the Queen’s Wharf development will include five new international hotel brands offering more than 1,000 premium hotel rooms. They comprise a Ritz-Carlton, Rosewood, Dorsett and two hotels from The Star Entertainment Group.

Australia’s first W hotel is also scheduled to open next month, on the banks of the Brisbane River on George Street, offering 312 guestrooms. The property will feature a 595 sqm Great Room, able to hold up to 450 guests, and Queensland’s only built-in LED screens. A 286-room Westin will follow in November, a few steps from the Brisbane Convention & Exhibition Centre and Queen Street Mall.

Another major project set to draw up to 766,000 visitors annually is the new A$100 million (US$77 million) cruise terminal. It will offer the only facility in Brisbane capable of hosting “mega ships” of over 270 metres in length, which is expected to be the norm by 2020.

Increasing air links from Asia also bode well for the city. Air China started a route from Beijing last December operating four times a week, while China Eastern bumped their operations to a daily service in November. Malaysia Airlines will also resume a non-stop service four times a week starting in June.

In fact, figures from Brisbane Airport predict that by 2035, 50 million visitors arrive by air – more than double the current figure of 22.7 million (as of 2017).

To accommodate this increasing air traffic, a new 3,300-metre-long runway is under construction. The project – expected to be complete by 2020 – will include more than 12km of taxiways, navigational aids, airfield infrastructure and hundreds of hectares of airfield landscape, at a total cost of A$1.3 billion (US$999 million).

According to Rob Nelson, COO of the Brisbane Convention Bureau: “Queensland has a lot to offer from the Great Barrier Reef to the beautiful weather. Brisbane is a natural gateway to Australia [from Asia-Pacific], and is a growing tourism and business destination. We’ve got a lot of projects in the pipeline and have already hosted major international events including Tourism Australia’s Dreamtime Showcase in 2017 and the G20 summit in 2014.”

Australia’s west-coast city made headlines recently with the launch of Qantas’s non-stop Perth-London service in March. This is the world’s second longest flight, connecting Europe with Australia in 17 hours.

Many other airlines are also eyeing Perth’s potential and upgrading their services accordingly. Singapore Airlines chose Perth as one of the first destinations to deploy its brand-new B787-10 aircraft, bringing new regional business and economy products starting this month. Qatar Airways is also upgrading its Doha-Perth route in May, replacing its B777-300ER with an Airbus superjumbo.

Meanwhile, Cathay Pacific has upgauged its daily Perth-Hong Kong service with an A350, replacing the current A330-300 and adding more than 21,000 seats to the route per year. At the end of 2017, China Southern Airlines also added an extra daily service on a brand-new A330, bringing an additional 43,888 seats each year.

A new runway and major expansion to the international terminal of Perth Airport are expected to be completed by 2020.

With the rise in visitors to the city, demand for accommodation is strong. There are currently 2,500 rooms being built, including a 350-room Westin opening this month, three Doubletrees by Hilton offering a total of 596 rooms, and a Ritz-Carlton housing 204 rooms opening in Elizabeth Quay – a project designed to transform the iconic Swan River area, enhancing the city’s reputation as “one of the world’s most liveable cities”. This city renewal project was completed in 2016, and has added five F&B outlets, an island playground, a BHP Billiton Water Park, installations of public art and interpretive heritage pieces.

While the redevelopment of Darling Harbour Precinct is ongoing, finished projects include the International Convention Centre (ICC) Sydney – Australia’s largest entertainment, events and conference facility, which opened early last year and has already been snapped up by international event organisers.

Liza Bajracharya, senior business development manager of Business Events Sydney, says: “We’ve had large numbers of visitors from China, Taiwan and Hong Kong in the last few years – half of the market share, with huge incentive groups from corporations such as Amway China, who brought us 8,000 delegates in January.”

After a period of stagnation, Sydney’s hotel developments have also ramped up. The new Sofitel Sydney Darling Harbour hotel opened at the end of 2017, with 600 rooms and direct access to ICC Sydney. Meanwhile, the old Four Points by Sheraton has been rebranded as the Hyatt Regency Sydney at Darling Harbour, offering a whopping 900 rooms and a stunning new sky bar overlooking Darling Harbour.

Looking to the future – 2020 to be exact – “The Ribbon” is a 25-storey multipurpose development that will boast new hotel rooms and serviced apartments, an IMAX Theatre plus retail and entertainment spaces.

Another iconic spot, Sydney Fish Market, is also scheduled for major upgrades. As part of the Bays Precinct Urban Transformation programme, the Fish Market will be relocated to a new Danish-designed building next to its current spot. The A$250 million-plus (US$192 million+) redevelopment – due to start later this year – will include the restoration of public access from Wentworth Park through to the waterfront, while world-class food and dining outlets will be brought in.

Sydney is a favourite destination for the Chinese, and mainland airlines are launching more and more flights to the New South Wales metropolis. China Eastern launched a Wuhan service in February last year, which was followed by Capital Airlines’ Qingdao route in October and Tianjin Airlines’ Zhengzhou service in January 2018. Virgin Australia has also announced the launch of a direct Hong Kong service starting in July this year, while China Airlines deployed its new A350 aircraft in December and has increased its Taipei services to 11 per week, adding an extra 100,000 seats.

Melbourne Airport has seen its international passenger numbers grow by 46 per cent over the past six years, and is expected to welcome more than 60 million visitors annually by 2033.

This has been driven in no small measure by a raft of new flights operated by mainland carriers: in June 2017, China Southern launched a three-times-weekly services to Melbourne from Shenzhen; in November, Tianjin Airlines launched three flights per week from Chongqing; and in December, Xiamen Airlines started twice-weekly Hangzhou-Melbourne flights, served by its B787-8 Dreamliner. Australia’s Jetstar also added air links to the mainland with a new service to Zhengzhou in December.

New services from other Asian carriers have also been coming thick and fast: Japan Airlines launched a non-stop Dreamliner service from Tokyo in September 2017, Sri Lankan Airlines debuted services to Colombo in October, and in August 2018, Cebu Pacific will launch a three-times weekly service to Manila.

To accommodate the serious uplift in passenger traffic, Melbourne Airport has been rapidly improving its facilities. In December it unveiled refurbished retail and dining outlets at Terminal, including high-end brands from Tiffany & Co to Tumi and Watches of Switzerland.

In addition to upgrading the airport, the city is expanding the Melbourne Convention and Exhibition Centre (MCEC) and broader South Wharf precinct. The project will add nearly 20,000 sqm of multipurpose event space, including 9,000 sqm of new exhibition halls, and additional meeting and banquet rooms, connected to the existing MCEC buildings. Once completed in July, it is expected to generate an additional 74,000 international visitors annually, spending an average A$693 (US$532) per day in Melbourne – a A$167 million (US$128 million) boost to the economy annually.

“The government has invested a lot in the business industry, which is great,” says Jason Balkin, associate director of business development and bids at the Melbourne Convention Bureau. “We are very excited about the convention centre expansion opening in July. There will be more exhibition and meeting space, and it will be the biggest exhibition and convention centre in the south hemisphere.”

The A$300 million (US$230 million) expansion project will also include a new 347-room Novotel hotel (opening soon) connecting directly to the MCEC.