OPINION: The vital moment for Brisbane’s hoteliers has arrived, now we need to make the pieces fit
Words by Richard Crawford, Senior Director Development, Australia, New Zealand and Pacific, Marriott International
I’ve just returned from a trip to the US where I had the chance to speak with colleagues from around the globe. Through these conversations and after touring a number of Marriott International’s flagship hotels, one thing became abundantly clear.
Right now is a vital moment in time for hotel development in Australia. All of us in the industry need to be prepared for the fact that we will be looking back at this point in a decade from now and asking ourselves: "Did we get it right? Did we build more interesting things that are more akin to international trends, or did we simply deliver more of the same?”
From Brisbane's point of view, there is now a series of interesting, sexy, genuinely world-class hotels both already built and in the near-term pipeline. And these projects will help redefine the city for the next decade or more.
We know here at Marriott International that it would be a shame to see us as an industry get that wrong. It would also be a shame to see us build hotel rooms just for the sake of meeting demand. Instead, we have the ability to build incredible, market-led hotels that deliver experiences which actually drive demand - and from a whole-of-industry perspective, the hotel sector needs to get it right.
So where do I see Brisbane fitting in that equation?
A different city in which to play
When I look at Brisbane today, I see an entirely different city from that which existed a decade ago. And I'm sure most visitors would have the same viewpoint.
It is now clearly a more compelling leisure destination than it was before. The marketing of the city has been really positive, and I think the visitor experience is a lot more interesting and more akin to a Sydney or Melbourne experience, if you like, than it was 10 years ago. And that, without question, has given confidence to investors.
New hotel supply has been a positive. On top of this, advancements in airline access and infrastructure changes have created a really compelling macro environment to which investors are attracted.
And that’s why Marriott International has two new hotels – W Brisbane and The Westin Brisbane – opening in the city this year.
Without those sorts of macro infrastructure improvements, I doubt whether the investor confidence would have been there to change the face of Brisbane in the way it has, or to deliver the world-class hotels we will be opening this year.
The state of the hotel market in Brisbane
The city is going to make some significant leaps in the next few years, and it spells good news for the hotel industry.
For us at Marriott International, Brisbane remains a good and desirable market. We're performing well and a lot of other hotel products are doing the same, although the numbers we're seeing with respect to industry performance point to a reality that the upper upscale and luxury sector is outperforming the mid-scale.
We are the largest upper upscale and luxury hotelier in the world by a very significant margin. We play really well in that space. When we're looking at where we take brands like W Hotels and Westin next, the first thing we do is consider the underlying demand metrics for upscale to luxury accommodation. The pointy end of the market in Brisbane has a history of showing resilience, and over a long period of time has outperformed the mid-market players. We continue to have that base level confidence in the market’s outlook.
When it comes to specific brands, W Hotels only has 53 properties around the world, so it's remarkable that such a small portfolio has generated so much buzz. It's a disrupter in the luxury sector and we believe Brisbane will benefit from an international name that has the potential to attract new markets to the city on the strength of brand recognition alone.
The success of the Westin Hotels brand in Australia is best evidenced by The Westin Sydney and The Westin Melbourne, which have both been exceptionally high-performing hotels for a long period of time. We think leveraging the success of the brand will garner immediate support from the corporate market for a Westin Hotels offering in Brisbane, underpinned by a passionate and loyal cohort of Westin Hotels customers.
A regional approach will make Brisbane’s hotels sing
Brisbane’s record tourism numbers provide some insight into the type of travel that's occurring. They also paint a positive story about visitor dispersal in the region.
If you take a broader South East Queensland view of the world, the visitor number baseline is good and we've seen it have positive impacts on the Sunshine Coast and the Gold Coast, as well as Brisbane, because of visitor dispersal. That’s a good news story for the capital when you take a hub mindset, provided the city has compelling enough appeal to capture overnight stays either at the beginning, the end, or on both sides of outside-the-city trips. Quality hotels, with cachet and differentiation, have an important role to play here.
This is also true of the challenge to extend the length of stay, a common goal of all markets and all capital cities, because the real magic happens when people stay for three or four nights, not just one. I think Brisbane’s hoteliers need to ask themselves: What can Brisbane do to really own being the central hub for this region from a tourism perspective?
Rather than see themselves as competing with the Gold Coast, the Sunshine Coast or the Darling Downs region, there's an opportunity to promote Brisbane as the hub, where visitors should fly and flop. From there, grab a hire car and explore the region, or do structured tours, to ultimately draw out those extra nights with compelling experiences on offer within the city and its day trip surrounds.
The next decade for Brisbane’s hoteliers
Queen's Wharf will be a killer punch that will redefine the city. That's really exciting and it can't come soon enough. We think that it's going to add immense leisure appeal to the destination, which will be good for everyone.
We have a reasonably clear read on the next three years regarding new hotel supply, and after that we expect there will be a pause to take the temperature of how the city is performing and to assess if the new supply has been absorbed by growing international and domestic demand.
If that proves to be the case, I think we will see continued optimism towards the Brisbane hotel market and eventually another wave of hotel development.
Hand on heart, I really believe that the domestic economic outlook and forecasted rate of domestic tourism growth, coupled with a continuation of international visitor arrivals, fueled by China and other markets, paints a compelling story in the medium-term. And, within the context of that timeframe, I would put Brisbane in the same conversation as I would Sydney and Melbourne in terms of my positive outlook for those markets.
In 10 years, when we do look back to this pivotal moment of tourism growth and hotel development activity in Brisbane, and right across Australia, we’ll hopefully be able to say: “Did we get it right? Damn right we did.”
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