Chinese investors set to buy into Australian tourism

Cashed up Chinese investors are keen to buy into the Australian tourism industry and relocate to Brisbane, Sydney and Melbourne.

“This will create a new class of buyers who will enter the industry looking not only at going concerns they can own and operate but also at investing in new projects,” says Ian Crooks, managing director of Resort Brokers Australia.

Mr Crooks and his national sales manager Trudy Crooks, have just returned from Hong Kong where they attended the launch of the second stage of Tourism Australia’s There’s Nothing Like Australia program and the annual Hotel Investment Conference Asia Pacific meeting.

“I met with one of China’s largest immigration lawyers who is waiting on the terms of new visa conditions about to be released,” says Mr Crooks. “He has a number of wealthy clients looking to relocate who want their children to go to school in Australia.
“This is exciting because we will get a different type of immigrant with funds, entrepreneurial skills and business experience,” he says.

The federal government has announced a new significant investor visa designed to attract overseas investors. Applicants have to commit at least $5 million to approved investments such as real estate, private Australian companies or managed infrastructure funds. Successful applicants will receive priority under the commonwealth government’s Business Innovation and Investment Scheme.

Mr Crooks says that among this group of buyers there are people who will buy investment units and apartments that could help drive the residential market in Australia. He says that it was obvious from the meetings he held in Hong Kong that Australia is seen as a strong market to invest in because of its stability, high room rates and assured capital gain.

“There is a real opportunity for another 100 hotels to be built across Australia, each with 100 rooms or more and there is now strong interest from international operators in leasing Australian hotels and putting high quality brands on the properties,” he says.
Mr Crooks says growth across the world in the hotel sector now outstripped all other property investment types including residential, commercial and industrial.

“This is due to the overriding returns plus capital gain that generally shows a 2%-3% higher return than any other type of property investment. Australia and Hong Kong are the two leading countries in the world as far as revenue per available room and return on investment because of high occupancies and the low number of rooms in Brisbane, Perth, Melbourne and Sydney,” he says.

Mr Crooks says Jocelyn Kum, CEO of family M&L Hospitality that owns the 682 room Four Points Hotel in Sydney, soon to be expanded to just under 1000 rooms, told the HICAP conference that the sole focus of her company’s investment strategy was the capital cities of Australia.

I showcased a number of properties while I was in Hong Kong including Hotel Cairns that is on sale for $10 million, The Kirketon in Sydney’s CBD and The Horizons Resort at Jindabyne in the NSW snow fields in NSW and there was a lot of interest,” he says. “This was reinforced by the enthusiastic reaction from Hong Kong and Chinese travel agents who attended the Tourism Australia launch campaign and who spoke of the high level of inquiry from clients looking to visit Australia.”

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