Queensland Tourism Product Lifecycle Study Prepared for: Queensland Government Prepared by: Jones Lang LaSalle Hotels & Hospitality Group Date: August 2014 Contents 1 Executive Summary ............................................................................................................................................ 1 1.1 Methodology .......................................................................................................................................................... 1 1.2 Queensland’s Accommodation Market Profile ....................................................................................................... 4 1.3 Queensland’s Product Lifecycle ............................................................................................................................ 4 1.4 Queensland’s Hotel Market Cycle ......................................................................................................................... 5 PART A – Product Lifecycle ............................................................................................................................................. 7 2 Queensland Accommodation Product Lifecycle .............................................................................................. 8 2.1 Methodology .......................................................................................................................................................... 8 2.2 Profile of Queensland’s Accommodation Market ................................................................................................... 9 2.3 Age of Accommodation Assets ............................................................................................................................ 12 2.4 Refurbishment Investment ................................................................................................................................... 13 2.5 Branding in Accommodation Real Estate ............................................................................................................ 14 2.6 Operating Contract .............................................................................................................................................. 15 2.7 Ownership Profile ................................................................................................................................................ 15 2.8 Accommodation Product Lifecycle – by Region................................................................................................... 17 2.9 Accommodation Product Lifecycle – by Property Type ....................................................................................... 21 2.10 Accommodation Product Lifecycle – by Star Grading .......................................................................................... 23 3 International and Domestic Comparisons ....................................................................................................... 26 3.1 Sydney ................................................................................................................................................................. 26 3.2 Phuket ................................................................................................................................................................. 29 4 Visitor Attractions Spectrum ............................................................................................................................ 32 4.1 Demand Generators ............................................................................................................................................ 32 4.2 Natural Attractions ............................................................................................................................................... 33 4.3 Experiences ......................................................................................................................................................... 35 4.4 Historical / Cultural Attractions ............................................................................................................................. 36 4.5 Man-Made Attractions.......................................................................................................................................... 38 PART B – Hotel Market Cycle Analysis ......................................................................................................................... 42 5 Australia’s Hotel Market Cycle ......................................................................................................................... 43 5.1 Hotel Market Cycle .............................................................................................................................................. 43 5.2 Australia’s Hotel Market Cycle – Historical Performance 1989 to 2013 ............................................................... 44 5.3 Australia and Queensland’s Accommodation Investment & Development Timeline ............................................ 47 6 Brisbane City Hotel Market Cycle .................................................................................................................... 50 6.1 Historical Performance 1989 to 2013 .................................................................................................................. 50 6.2 Occupancy and Rate Correlation ......................................................................................................................... 52 6.3 Brisbane Near Term Performance ....................................................................................................................... 53 6.4 Outlook 2014 to 2018F ........................................................................................................................................ 53 6.5 SWOT Analysis of the Brisbane City Accommodation Market ............................................................................. 56 7 Gold Coast Tourism Region Hotel Market Cycle ............................................................................................ 57 7.1 Historical Performance 1989 to 2013 .................................................................................................................. 57 7.2 Occupancy and Rate Correlation ......................................................................................................................... 59 7.3 Gold Coast Near Term Performance ................................................................................................................... 59 7.4 Outlook 2014 to 2018F ........................................................................................................................................ 60 7.5 SWOT Analysis of the Gold Coast Accommodation Market ................................................................................ 63 8 Tropical North Queensland Hotel Market Cycle .............................................................................................. 64 8.1 Historical Performance 1989 to 2013 .................................................................................................................. 64 8.2 Occupancy and Rate Correlation ......................................................................................................................... 66 8.3 Cairns Near Term Performance ........................................................................................................................... 66 8.4 Outlook 2014 to 2018F ........................................................................................................................................ 67 8.5 SWOT Analysis of the Tropical North Queensland Accommodation Market ....................................................... 70 9 Great Barrier Reef Hotel Market Cycle ............................................................................................................. 71 9.1 Historical Performance 1989 to 2013 .................................................................................................................. 71 9.2 Occupancy and Rate Correlation ......................................................................................................................... 73 9.3 Great Barrier Reef Near Term Performance ........................................................................................................ 73 9.4 Outlook 2014 to 2018F ........................................................................................................................................ 74 9.5 SWOT Analysis of the Great Barrier Reef Accommodation Market ..................................................................... 76 10 Regional Queensland Hotel Market Cycles ..................................................................................................... 77 10.1 Introduction .......................................................................................................................................................... 77 10.2 Bundaberg ........................................................................................................................................................... 77 10.3 Central QLD ......................................................................................................................................................... 78 10.4 Darling Downs 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