Australia’s tourism awakening

Optimism abounds in the Land Down Under, with pandemic entry restrictions lifting and pent-up demand driving travelers willing to spend more and stay longer.

The Sydney Opera House and the city’s skyline. (Photo by Rudy Balasko/Shutterstock.com)

The Sydney Opera House and the city’s skyline. (Photo by Rudy Balasko/Shutterstock.com)

The Sydney Opera House and the city’s skyline. (Photo by Rudy Balasko/Shutterstock.com)

American accents in the shadows of the Sydney Opera House were an early indicator to me that, after two years of inbound Covid restrictions that were among the strictest in the world, Australia’s appeal to U.S. visitors has not dimmed.

And Australian destination marketers are as enthusiastic to welcome Americans back as Americans are to return. At “Come and Say G’Day,” an event organized by Tourism Australia for industry executives, travel buyers and media in Sydney recently, the general sentiment was both hopeful and celebratory. Tourism remains integral to Australia’s economy, and although the country faces the same labor and supply chain challenges as the rest of the world, the country’s travel and hospitality sector is eager for a reboot. 

Before the pandemic, 9.5 million visitors brought in $45 billion in travel spend, and one in 13 jobs in the country were related to travel. Now that the borders have reopened, Australia is more than ready to return to that lofty benchmark.

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The Parliament House in Canberra. (Photo by Ramsey Qubein)

The Parliament House in Canberra. (Photo by Ramsey Qubein)

The Parliament House in Canberra. (Photo by Ramsey Qubein)

Phillipa Harrison, managing director of Tourism Australia, said she believes she is already observing “the beginning of a renaissance” for travel. Other tourism leaders see the beginning of this century’s version of the Roaring ’20s, fueled in part by the money visitors saved during the pandemic. The floodgates for travel, they believe, are ready to open.

Given its geographical location and the resources necessary to get to Australia, it has always drawn a significant number of high-spending visitors. Ranking seventh in tourism receipts globally, the country has always punched above its weight in that regard. 

Harrison said that once borders reopened, there was a rush of friends-and-relatives traffic. (One out of every four Australians was born outside the country.) But leisure visitors and conference attendees have begun showing up sooner than anticipated.

Currently, demand is at about 65% of pre-Covid levels, a relatively quick rebound aided, perhaps, by the large number of outdoor activities that Australia offers. The research firm Oxford Economics predicts that by the end of the year, aviation activity will have returned to 73% of 2019 levels, and tourism as a whole should hit pre-Covid levels by 2024. 

Not surprisingly, the booking curve for inbound travel is building more slowly from long-haul markets than from places closer to Australia. The biggest inbound market currently is Singapore, which has been open to Australia since November. 

North America is not far behind, but airfares are high, reflecting reduced capacity; business-class fares regularly reach five digits. This is expected to change as airlines ramp up capacity across the Pacific in the coming months. Delta and United fly nonstop from the U.S., although American Airlines has not yet resumed its nonstop from Los Angeles, choosing instead to rely on its joint venture with Qantas. In addition to its West Coast gateways, Qantas is flying long-haul from Dallas to Sydney and Melbourne and recently announced that an ultralong-haul flight between Sydney and New York will commence in 2025.

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Newcastle on the Hunter River in New South Wales. (Photo by Ramsey Qubein)

Newcastle on the Hunter River in New South Wales. (Photo by Ramsey Qubein)

Newcastle on the Hunter River in New South Wales. (Photo by Ramsey Qubein)

The 550 travel providers attending the Tourism Australia event had to rely heavily on domestic tourism for much longer than many other international destinations and were clearly ready to showcase their new products to an international audience. 

Being a long-haul destination has some obvious disadvantages — many potential visitors are simply put off by the length of time needed to get there — but it also benefits from the effort. Dan Sullivan, CEO of Collette, which sells tours to Australia, said that travelers who are willing to invest the time to get to the country will also invest money to ensure a memorable visit. 

He pointed to a trend showing that customers are staying about a week longer than they had before the pandemic, with demand for business-class tickets high. Customers, he said, are also extending trips to see the South Pacific beyond Australia, booking add-ons for New Zealand, Fiji and French Polynesia. Demand for the entire region is high, Sullivan believes, because so many of the activities in the region are outdoors, which helps make people feel safe. 

Many representatives of Australian travel companies I spoke with said they’re booked solid for the rest of the year and even into 2023. Many cities, including the nation’s capital, Canberra, are also benefiting from a surge in demand from a domestic market interested in exploring its own country and history.

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The view of the New South Wales coastline from a Sydney Seaplanes aircraft. (Photo by Ramsey Qubein)

The view of the New South Wales coastline from a Sydney Seaplanes aircraft. (Photo by Ramsey Qubein)

The view of the New South Wales coastline from a Sydney Seaplanes aircraft. (Photo by Ramsey Qubein)

New hotels and attractions await

During the pandemic, the Australian hospitality industry was not idle. More than 100 hotels opened or went through renovations over the past two years. 

These include the Crown Towers, a striking structure that dominates the Sydney skyline, and IHG’s first Kimpton on the continent, the Kimpton Margot Sydney, which opened in February in the heart of the central business district. 

Marriott was busy in Melbourne, opening the W Melbourne and the Marriott Melbourne Docklands as well as the country’s first AC: the AC Hotel Melbourne Southbank. Elsewhere, Marriott opened the Tasman Hotel, part of its Luxury Collection brand, in Hobart, Tasmania, and the Marriott Courtyard Brisbane Southbank. 

Hyatt expanded with the Hyatt Regency Brisbane, while Accor opened new Movenpick properties in Hobart and Melbourne as well as a new Sofitel in Adelaide. 

Hilton added the Melbourne Little Queen Street property to a list of more than two dozen Hilton family hotels operating in the country. 

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A balloon ride with Balloon Aloft Hunter Valley. (Photo by Ramsey Qubein)

A balloon ride with Balloon Aloft Hunter Valley. (Photo by Ramsey Qubein)

A balloon ride with Balloon Aloft Hunter Valley. (Photo by Ramsey Qubein)

Among the properties still in the works are the W Sydney at Darling Harbour, with plans to open in 2023, and a Ritz-Carlton that will open soon in Melbourne as the second property for the brand on the continent. Melbourne’s Shangri-La will not be far behind. 

In June, Langham is slated to open the Langham Gold Coast in the resort area of the same name, adding the popular destination to its hotels in Sydney and Melbourne. 

Also new since the pandemic began is the Port Stephens Koala Sanctuary, where injured or orphaned koalas are brought for care and live in a natural habitat. The family-friendly experience offers glamping tents to sleep amid the wildlife.

A koala munches eucalyptus at the Port Stephens Koala Sanctuary, where the injured or orphaned marsupials are brought for care and live in a natural habitat. (Photo by Ramsey Qubein)

A koala munches eucalyptus at the Port Stephens Koala Sanctuary, where the injured or orphaned marsupials are brought for care and live in a natural habitat. (Photo by Ramsey Qubein)

A koala munches eucalyptus at the Port Stephens Koala Sanctuary, where the injured or orphaned marsupials are brought for care and live in a natural habitat. (Photo by Ramsey Qubein)

And existing experiences revamped their offerings to be pandemic-friendly. Sydney Oyster Farm Tours now closes its tours with lunch served at tables in the river, an idea born from social-distancing rules; guests don waders and stand waist-deep while sampling oysters and sipping glasses of bubbly.

Sydney Oyster Farm Tours now closes its tours with lunch served at tables in the river, an idea born from social-distancing rules. (Photo by Ramsey Qubein)

Sydney Oyster Farm Tours now closes its tours with lunch served at tables in the river, an idea born from social-distancing rules. (Photo by Ramsey Qubein)

Sydney Oyster Farm Tours now closes its tours with lunch served at tables in the river, an idea born from social-distancing rules. (Photo by Ramsey Qubein)

My visit to Australia included stops in the wine region of Hunter Valley, north of Sydney, and Canberra. Everywhere I went, restaurants and museums were packed, ferries were bustling and street performers were back in action. Cruise ships, having recently returned to Australian itineraries, were docked in Sydney.

Some of the international visitors I spoke with were celebrating their first big trip in years. Among them were people who had come for a business conference and extended their stays to visit other parts of Australia.

Several travelers said that flexibility was key: There still might be last-minute changes, and they were prepared for additional Covid tests and masking requirements. (While Australia has eased testing requirements, masks are still required in airports, on flights and on public transport like buses and ferries.)

These protocols and practices, including lingering requirements from the U.S., are still hurting demand and suppressing bookings, according to Sullivan. 

“The U.S. lifted the mask mandate. They should lift the [return] testing requirement for vaccinated travelers, too,” he said.

And when that happens, one can imagine that the Australia renaissance will truly be realized.

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