The Luxury Hotels industry has fared better than other hotel segments, partly due to rising inbound tourism from Asia
Melbourne, Australia (PRWEB) November 07, 2014
Over the past five years, the Luxury Hotels industry has had its ups and downs. The onset of the global financial crisis caused a downturn in guest numbers, with the effects lingering into 2009-10. Occupancy for the overall hotel sector fell to about 63.0% in the June quarter of 2009, down from an average of 70.0%. Despite this, the Luxury Hotels industry is expected to have fared better than other hotel segments. According to IBISWorld industry analyst Ryan Lin, "this is partly due to rising inbound tourism from Asia, which has kept many luxury hotels away from the chopping blocks as cashed-up tourists have flocked to luxury destinations across Australia." Inbound Asian tourists have been the driving force behind growth in tourism expenditure over the past five years.
The growth in demand for luxury hotels has mainly been driven by international tourists, with domestic tourism playing a smaller role. This has largely been due to the strength of the Australian dollar over much of the past five years, which made international travel more appealing to Australian tourists. However, the depreciation of the Australian dollar since mid-2013 is giving domestic tourism a boost, as international travel has become more costly due to the lower exchange rate. As a result, industry revenue is expected to grow at an annualised 3.6% over the five years through 2014-15, to total $3.3 billion. In 2014-15, inbound tourists are expected to take advantage of the lower dollar, with industry revenue forecast to grow by 3.8%. Over the next five years, similar trends are expected to affect the industry, with inbound tourism sustaining industry growth. However, "competition from other hotels, motels and serviced apartments is expected to grow strongly," says Lin.
The Luxury Hotels industry is characterised by a low level of market share concentration. The industry consists of large hotel companies and smaller participants that operate boutique establishments. Industry structure varies significantly depending on whether players are owner-operators or operators on lease. The majority of firms in the industry prefer not to own hotel property, instead concentrating on hotel management. However, there are some independent hotel owners, such as Crown Resorts Limited.
For more information, visit IBISWorld’s Luxury Hotels industry in Australia report page.
This industry includes high-end luxury hotels that are mostly rated five stars, although a number of four-star hotels are also positioned as luxury hotels due to their service offerings.
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