Luxury Hotels in Australia

2020 IMPACT

International travel bans devastate luxury hotel bookings in 2020

International travel bans as a result of the pandemic greatly impacted bookings for luxury hotels. In an attempt to control the spread of COVID-19, Australia introduced a ban on the arrival of all non-citizens or permanent residents from 20 March 2020, with the exception of an air bubble with New Zealand towards the end of the year.

Luxury hotels try to maintain sales by using various strategies in 2020

Hotels have had to use different strategies to generate cashflow and fight for survival during COVID-19. For instance, Marriott Australia & NZ’s Pier One Hotel remained opened during 2020 but implemented safety measures to ensure customers’ stays are comfortable and safe.

Palazzo Versace Gold Coast’s maintenance delayed due to international travel ban thanks to the pandemic

Conversely, other hotels were closed during the country-wide lockdown in the second quarter of 2020 or used the opportunity for renovations and maintenance at their establishments. Versace SpA’s Palazzo Versace Gold Coast, for example, was closed during the initial lockdown, from the start of April until June 2020 and closed again for maintenance until the beginning of August.

RECOVERY AND OPPORTUNITIES

Luxury hotels likely to benefit over the forecast period as a result of diligent following of safety protocols due to larger budgets

As with experiential luxury, COVID-19 affected luxury hotels in Australia negatively in 2020 and the category is not expected to recover over the forecast period. However, both health and safety became a new luxury during the pandemic.

Luxury hotels likely to benefit from domestic tourism but unlikely to recover before borders open again

The luxury hotel industry is heavily reliant on international travel and tourists. Therefore, as a result of international border closures, which are not expected to open in the first half of 2021, luxury hotel occupancy rates are expected to continue suffering despite Australians travelling within the country more than ever.

Fairmont to build a new luxury hotel in Queensland by 2023

The luxury Fairmont hotel brand announced plans for opening a luxury hotel in Port Douglas, Queensland in 2023. This will be Australia’s first Accor Fairmont hotel with construction of the AUD300 million resort commencing early in 2021.