Hoteliers are out to reboot their fortunes, rolling out a swathe of new deals in a bid to lure locals into CBDs on the back of a range of government tourism initiatives.
Earlier this month, the federal government’s announced a $1.2 billion tourism and aviation industry support package aimed at stimulating the domestic travel sector from April.
However, the package—which includes 800,000 half-price air fares and low-interest loans for small tourism operators—left many hotel operators in CBD locations wondering just how effective it would be.
Soon after, Tourism Australia announced its City Escapes campaign.
Following the announcement a number of high profile hotel chains, including InterContinental Hotels Group, slashed room rates by up to 20 per cent.
InterContinental Hotels Group currently operates 36 properties across Australia.
JLL Hotels managing director Peter Harper said federal and state-based initiatives would release pent-up demand from corporate and domestic travellers.
“The half-priced airfares provide a strong vote of confidence from the federal government that it is now safe to travel to all locations across Australia,” Harper said.
“We expect that after 12 months of not travelling for many individuals, a first trip for leisure or business will restore confidence in the hotel sector and promote further travel plans, including to CBD locations.”
Harper will speak at The Urban Developer’s Hotel vSummit today streaming live between 10am and 4pm AEDT.
Hotel occupancy rates nationally continue to fluctuate between 30 and 40 per cent in many CBD locations.
“It has been a difficult 12-month period for hoteliers in Australia, particularly for those in CBD and fly-to locations,” Harper said.
“We see the next six to 12 months as the beginning of the recovery for the majority of hotel trading markets.”
Many states now have their own initiatives in place, with Queensland and Victoria releasing $200 travel vouchers.
The Queensland government has also committed $1 million to support more than 6500 Queensland students to explore the Great Barrier Reef.
The South Australian government has also spent $4.5 million on two rounds of travel vouchers.
“Consistent border policy between states will play a defining role in how quickly regular corporate and domestic tourism can return,” JLL Hotels vice president Andrew Langsford said.
“At present the threat of border closures at short notice has been highly damaging to traveller confidence.
“The roll back of wage support via JobKeeper will be a further test for many business through this transition period.”
With the JobKeeper package to end in March, many have argued a tailored wage subsidy scheme is needed for regional locations that are more exposed to international tourism than holiday spots within driving distance of capital cities.
“Loans to JobKeeper-reliant small businesses with a two-year repayment holiday will be critical for many businesses surviving the next six to 12 months while confidence returns to the domestic market,” Langsford said.