Chinese tourists swap Seoul for Sydney in Golden Week, expected to stretch hotels
Political tensions on the Korean peninsula will re-direct a larger share of the $9.2 billion Golden Week expenditure to Australia, according to iProsperity (iPG), an advisory firm for high networth investors.
Australia has seen a four-fold increase in the number of Golden Week tourists in the past decade, ABS data shows.
Over the same period, Chinese tourists’ annual total expenditure has surged 700%, to $1.4billion.
iPG director Gary Sue Fong says Golden Week in 2017 is expected to smash previous records, and predicts Australia’s hotel sector will be pushed to the brink over the eight-day holiday break.
“Currently, Australia’s hotel occupancy rates are ranked among the highest in the world, with the hotel occupancy rates averaging 78% across Australia throughout 2016. To keep up with ongoing demand, the domestic hotel sector needs to grow by a third to capitalise on the lucrative Chinese tourist market,” said Sue Fong.
“The majority of Chinese tourists cite safety and security as the number one consideration when selecting a Golden Week destination. We’re witnessing strong demand across the country’s major leisure destinations.”
Chinese travel agency Ctrip forecasts a 70% fall in the number of Chinese tourists to South Korea during Golden Week this year, as rising tensions on the Korean peninsula deter China’s six million travellers from top destinations, South Korea and Japan.
Ctrip data reveals 80 per cent of people using its platform opt for four and five star services when travelling abroad.
As wealthy travellers from China look for luxury experiences in Australia, supply is struggling to keep up with demand across Australia, adds Sue Fong.
Hotels in Cairns and Port Douglas, in particular, lead in terms of revenue growth, while the second strongest market, Sydney, is expecting double-digit revenue growth this year.
In FY2017, there are currently 101,196 rooms across Australia’s major cities, with a 78.6% occupancy rate. This is forecast to grow by 33%, adding 33,303 new hotel rooms to the supply in Australia by 2025 to meet demand with a 81.6% occupancy rate, and 4.4% increase in RevPAR, $142.53 to $203.78.
