Delving deeper (this data can also be matched with hotel / bread and breakfast room supply to extrapolate supply and demand gap) in chart 7 and 8 is the split of international short-term arrivals for place of stay for the month of Dec22. NSW tops the chart with 242k short term visitors (37%) with VIC 171K (27%) and QLD 121K (20%).
Compared to 2019 (chart 9,10), NSW is only at 62%, VIC at 57% and QLD at 57% of 2019 levels. The conclusion is two-fold. One, it is obvious there is a large potential for a return to previous performance. Two, if an incoming recession ensues potentially flatlining consumer spending and business travel, coupled with the possibility of China reversing course and together with an incoming increase in supply of hotel rooms in Australia, hotels / short term accommodation industry may see risks to occupancy, revpar and margins.
International short term visitors 3 main reasons of stay were “visiting friends / relatives” (47.8%), Holiday (28.6%) and Business (7.2%). Chart 11 shows 33% of visitors staying between 2-4 weeks. Median short trip duration in 2022 was 18 days, in 2019 median short-term trip was 10 days, it is interesting to note median travel was 30 days during lock downs in 2021. Most likely, time of stay will trend down back to previous median of 10.
All research and charts by Charles Man. Please ask for permission if re-use. All raw data from STA, STR and core logic unless otherwise stated.
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