Skift Breaking News Blog

Short stories and posts about the daily news happenings around the travel industry.

Tourism

Australia Struggling to Balance Inbound Visitor Void With More Local Tourists

1 week ago

The number of Australians leaving for international trips has been more than 80 percent above the number of incoming visitors to the country.

Reporting on Friday, The Australian (paywalled) said:

Australian Bureau of Statistics data showed in May 420,110 people traveled abroad for a short-term trip, 81 percent more than the 231,480 short-term arrivals. The gap was more than double that of May 2019, when the number of outbound travelers was 39 percent greater than visitors.

The Australian quoting tourism data from the ABS.

The pattern creates a problem for domestic tourism destinations, who are not only losing foreign visitors but also domestic travelers going abroad instead.

The problem is of a manageable size and hopefully short-term. When viewed in context. Inbound travelers were now at 34 percent of pre-pandemic levels, while outbound travelers were at 45 percent of pre-pandemic levels.

But the international visitor gap is still a real problem for businesses struggling to hold on for the rebound now beset with rising costs for labor, supplies, and energy.

See the Australian Bureau of Statistics tourism data here.

Short-Term Rentals

Australia’s Alloggio Expands Short-Term Vacation Rental Network

1 week ago

Alloggio, a short-term rental property manager based in Australia, has invested $11 million ($16 million Australian) since its November initial public offering. The small company has acquired rights to manage properties and getting its own channel manager by acquiring Aabode.com, reported The Australian.

The company is strengthening its position as one of the country’s managers of short-term rentals and vacation homes through a series of acquisitions of companies, including Great Ocean Road Holidays, Best of Magnetic, Prestige Holiday Homes, First National Magnetic Holiday Rent Roll, and The Edge Holiday Rent Roll at Coffs Harbour.

Alloggio now manages about 1,950 holiday homes in the country. For fiscal year 2022, it expects to generate revenue of at least $14 million ($21.5 million Australian) and earnings before interest, taxes, depreciation, and amortization of at least $7 million ($10.5 million Australian).

Business Travel

Flight Centre Has Profits in Sight, Thanks to Higher Airline Fares

3 weeks ago

Australia’s Flight Centre Travel Group has finally turned a corner, and on Monday updated its 2022 fiscal year market guidance after seeing a “solid rebound” in travel demand.

The Australian based travel giant now predicts it will report a “healthy” fourth-quarter profit, for the three months up to June 30, 2022, on an underlying earnings before interest, taxes, depreciation, and amortization (or EBITDA) basis.

It also aims to break even in its second half, or the six months up to June 30, 2022.

The update comes ahead of its full-year results being published on August 25.

The group took drastic steps early on during the pandemic, closing some 800 retail stores in April 2020. Some 40 percent of those closures involved agencies based in Australia.

“The scale of our recovery exceeded our initial expectations and meant that we should now exceed our preliminary full-year 2022 result target, with early trading results pointing to a breakeven second-half result and a healthy fourth quarter profit,” said managing director Graham Turner in a statement on Monday.

However, it said it expects to report a full-year loss of between $125 million and $132 million for the 12 months to June 30, 2022.

Overall, this would represents an 11.9 percent improvement on its initial 2022 market guidance

In 2021, it made a loss of $234 million.

Total transaction value for the year topped nearly $7 billion, more than two-and-a-half times seen in 2021, the company added, fueled by an uplift in demand and higher than normal ticket prices linked to a lack of airline capacity, particularly on international routes.

Hotels

Asia-Pacific Hotel Investment Volumes Rose to $7 Billion in First Half of 2022

1 month ago

Investment in the hotel sector in Asia Pacific continued to recover as investment volumes totaled $6.8 billion in the first six months of 2022, according to real estate brokerage firm JLL’s report.

Capital deployment into the region’s hotels sector showed a return to pre-pandemic levels, registering a 12 percent increase compared to 2019.

Countries in the Asia-Pacific region are expected to experience a fast pace of recovery in the second half of 2022, Skift Research noted recently in its Asia Pacific Accommodation Sector Market Estimates 2022.

In terms of investment volume Japan received the maximum capital —  $1.8 billion, followed by Korea’s $1.7 billion, and Greater China, including Hong Kong ($1.6 billion).

A strong domestic and international tourism demand and the recent devaluation of the Japanese Yen would drive investors to acquire hotel assets in Japan, JLL noted.

JLL also expected further price reductions of hotel assets and forecasts China’s hotel transaction volume to total approximately $2 billion in 2022.

Strong recovery was witnessed in countries like Singapore ($899.7 million), Maldives ($205.5 million), and Indonesia ($159.6 million).

The activity was more subdued in Australia ($145.5 million) and Thailand ($37.7 million), however, JLL noted that these countries would witness greater investment in the second half as numerous marque deals would be closing.

More hotels are entering the Thai market as sellers are under pressure to sell, noted JLL and forecast that transaction volumes would reach close to $300 million this year.

While the 75 transactions in the first half of 2022, were down 33 percent compared to the first half of 2019, the 19,822 rooms transacted during the first half of 2022 was 30 percent higher compared to the first half of 2021 and 9.4 percent compared to 2019.

“The increase in deal activity was influenced by a spike in portfolio transactions as institutional investors sitting on dry powder seek to deploy their capital more efficiently,” the report noted.

However, according to JLL, ongoing momentum will likely be challenged by growing macroeconomic and geopolitical headwinds in the second half of 2022.

“We remain steadfast in our conviction that total Asia Pacific hotel investment volume will cross the $10 billion mark despite the scarcity of assets coupled with macro and geopolitical headwinds that will continue to influence capital activity,” said Mike Batchelor, CEO, Asia Pacific, JLL Hotels and Hospitality Group. 

Business Travel

Australian Corp Travel Agency CTM Notches Up Yet Another Acquisition to Expand in U.S.

1 month ago

Australia’s Corporate Travel Management has bought 1000 Mile Travel Group in an all-share transaction.

Terms of the deal were not fully disclosed, but on Friday CTM issued 106,336 fully paid ordinary shares to Zazi Pty Ltd, in its capacity as trustee of the Zazi Investment Trust, as part consideration for the acquisition of 1000 Mile Travel Group.

This element values the deal at more than $1.3 million.

Founded in 2015, 1000 Mile Travel Group is a network of independent travel experts who handle corporate, group, cruise and leisure bookings.

CTM said the acquisition will help it expand its “independent consultant footprint” in the small and medium enterprise market in Australia, the UK and North America a region where it’s been heavily investing over the past two years.

CTM snapped up U.S.-based Travel and Transport for $195 million in September 2020, months after acquiring Texas-based Corporate Travel Planners.

Closer to home it recently bought Melbourne-based Helloworld Corporate for $127 million.

The deal comes at a time when travel management companies are desperately seeking to recruit more consultants to cope with renewed demand for business trips.

“Our business was established to meet the needs of the independent corporate travel business owner market, and our business model has grown from strength to strength,” said Ben Ross, 1000 Mile Travel founder and managing director. “That model has never been more in demand than it is in the post-pandemic environment, and we’re excited to take the next step of our growth journey with CTM.”

CTM founder and managing director Jamie Pherous added the agency was “well-placed to expand the 1000 Mile Travel model into our largest markets of North America and the UK.”

Short-Term Rentals

Tour Operator Intrepid Invests in Remote Eco-Cabins Startup CABN

3 months ago

Intrepid Travel, one of the world’s largest adventure travel tour operator is investing about $5.5 million USD into an Australian remote eco-cabins startup CABN. Currently the startup has 11 cabins across South Australia and Victoria and plans to build 70 eco cabins by 2023, with this money injection.

The model involves building the eco cabins offsite then transferring them to private land. Each cabin is built from predominantly locally sourced and sustainable materials and requires minimal infrastructure, with a “leave no trace” philosophy, says this story in AFR.

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