Australia Hospitality Market Size, Share, Growth Analysis Report and Forecast Trends (2025-2034)

The Australia Hospitality Market was valued at AUD 102.05 Billion in 2025, and is projected to reach AUD 148.18 Billion by 2034, rising at a CAGR of 3.80%.

Australia Hospitality Market Trends

The Australia hospitality market enriches tourism by attracting visitors with unique accommodations and dining while promoting local food and attractions to support small businesses. This sector also fosters cultural exchange, bringing together diverse communities through shared experiences and events that celebrate the nation’s multicultural heritage. The Melbourne Food and Wine Festival, held annually in March since 1993, celebrates the city's culinary scene and regional offerings. Spanning 15-20 days, the festival attracts over 300,000 visitors each year, positively influencing the Australia hospitality market revenue. It promotes cultural exchange by featuring international chefs and traditional dishes, fostering appreciation for diverse culinary traditions.

The growth in the Australia hospitality industry attracts substantial investment, leading to infrastructure development and service innovation that enhance quality and competitiveness. Additionally, a growing focus on sustainability fosters eco-friendly practices, appealing to environmentally conscious consumers and promoting responsible tourism that safeguards natural resources. In September 2024, Accor celebrated the certification of its 100th hotel in Australia by Ecotourism Australia, highlighting its commitment to eco-friendly hospitality. This milestone supports Accor's goal of having all its Pacific properties certified for sustainable tourism by the end of 2025, reflecting its dedication to environmentally responsible practices.

Australia Hospitality Market Growth

The Australia hospitality market is thriving due to rising tourism numbers, with increased domestic and international visitors driving demand for accommodations and dining. According to UN Tourism, in 2021, Australia had 5,960 hotels and similar establishments, offering over 304,000 hotel rooms. These accommodations provide unique, personalised experiences that emphasise local culture and aesthetics, fostering community connections and supporting local artisans, thereby enhancing the destination's allure.

Technology adoption in hospitality, including online booking and contactless services, has improved customer experiences and operational efficiency, driving Australia hospitality market growth. Moreover, the growing trend of experiential travel prompts providers to develop customised packages that highlight local culture and distinctive attractions, boosting market appeal. In September 2023, the B2B online travel reservations platform RezLive launched in Australia in partnership with AVIAREPS, offering a wide range of hotel rooms, tours, and transfers globally, exclusively for travel advisors.

Australia Hospitality Market Insights

• The Australian Bureau of Statistics reported that short-term visitor arrivals rose by 191,360 in January 2024, bringing the annual total to 603,770 trips.
• The Australian Bureau of Statistics noted that total arrivals in January 2023 reached 2,122,070, reflecting an annual increase of 514,060.
• Industry reports indicated that there were 355,570 tourism businesses in Australia as of June 2023, representing 14% of all Australian businesses, or one in seven.

Industry News

September 2024: Hyatt Hotels Corporation announced its agreements with Destination Gold Coast Consortium to develop an Andaz resort in Gold Coast, Australia. This consortium, a partnership between The Star Entertainment Group and Far East Consortium and Chow Tai Fook Enterprises, planned the resort's opening for mid-2025.

July 2024: Marriott opened its first Le Méridien hotel in Australia, located in a former theatre, cinema, and nightclub. The 235-room property, situated in the Melbourne upscale shopping and dining area, overlooked Parliament House, and represented Marriott's strategy to grow in new and emerging markets.

Australia Hospitality Market Drivers

Growing Focus on Sustainability

The Australia hospitality market is increasingly prioritizing sustainability, with hotels and restaurants implementing eco-friendly practices like waste reduction, local sourcing, and energy efficiency. Growing consumer awareness drives demand for green accommodations and sustainable dining, making sustainability vital for attracting eco-conscious travellers and boosting Australia hospitality industry revenue. In September 2024, Peppers Silo Hotel Launceston became the first hotel in Tasmania to earn Ecotourism Australia’s Sustainable Tourism Certification, meeting global sustainability standards. Recognised for its eco-friendly practices in the hotel and restaurant, it confirmed compliance with eight criteria, including environmental management and community engagement, joining Australia's growing roster of certified accommodations.

Technology Integration

The Australia hospitality market is experiencing growth due to the integration of technology, which is revolutionizing customer experiences and operational efficiency. Innovations like online booking systems, mobile check-ins, and contactless payments enhance convenience and streamline operations. Hospitality businesses utilize data analytics to gain insights into customer preferences, enabling personalised services and targeted marketing. The Australia hospitality market dynamics and trends are being further impacted by advancements in virtual and augmented reality, which enrich guest experiences through virtual tours and interactive dining options. In July 2024, travel technology provider Amadeus partnered with Microsoft to leverage AI, simplifying hoteliers' access to business intelligence. Amadeus introduced a new chatbot for its business intelligence suite, Agency360+, powered by the Azure OpenAI Service, enabling hoteliers to make complex data requests and receive rapid, natural language responses.

Opportunities in the Australia Hospitality Market

The Australia hospitality market is witnessing growth due to a strong emphasis on health and wellness. Travelers are now seeking accommodations and dining that support both physical and mental well-being. This includes wellness amenities like fitness centers, spa services, and healthy menu choices. Hotels are introducing wellness retreats and programs that promote relaxation and rejuvenation. The growth of wellness tourism reflects a societal trend toward health awareness, encouraging hospitality businesses to modify their offerings to satisfy the rising demand in the Australia hospitality market, thereby making wellness a vital part of the travel experience. In April 2024, The Hotel & Wellness Co announced plans to open Australia’s first urban thermal bathing and wellness hotel, transforming The Kinson in Melbourne by early 2025. The hotel will feature thermal bathing, sensory zones, and wellness treatments, promoting mindfulness and relaxation while utilising mineral salts from Peninsula Hot Springs to enhance the therapeutic benefits of the urban experience.

Market Restraints

The Australia hospitality market faces several key restraints. Economic fluctuations can reduce consumer spending, impacting occupancy rates and revenue. Labour shortages challenge service quality and growth, especially post-pandemic. Regulatory complexities can burden smaller businesses, while intense competition pressures profit margins.

Changing consumer preferences demands unique experiences and sustainability. Environmental concerns increase operational costs. Additionally, inadequate infrastructure in some regions hinders tourism growth. Addressing these issues is essential for the sector's sustainable development.

This report offers a detailed analysis of the market based on the following segments:

Market Breakup by Type

• Chain Hotels
• Independent Hotels

Market Breakup by Segment

• Service Apartments
• Budget and Economy Hotels
• Mid and Upper Mid-Scale Hotels
• Luxury Hotels

Market Breakup by Region

• New South Wales
• Victoria
• Queensland
• Australian Capital Territory
• Western Australia
• Others

Australia Hospitality Market Share

By Types Analysis

The Australia hospitality market benefits from chain hotels, which deliver a uniform experience across their properties, allowing guests to anticipate service and amenities, thereby building trust and brand loyalty. Established brands attract both domestic and international travellers, often resulting in higher occupancy rates. Furthermore, many chains provide loyalty programs that encourage repeat visits, boosting customer retention. They also leverage centralised resources for marketing and training, enhancing operational efficiency and driving the hospitality demand. In September 2024, StandardX in Melbourne made a striking debut in Australia’s hotel market, representing two key milestones: it is the first Standard International hotel in the country and the first StandardX globally. This “younger, rebellious sibling” of the brand preserves its signature features while providing a more budget-friendly option.

The Australia hospitality market is enhanced by independent hotels, which provide unique experiences through distinctive designs and personalized services that immerse guests in local culture. These hotels can swiftly adapt to market trends and customer preferences, fostering innovation without corporate limitations. Additionally, they often collaborate with local businesses, promoting regional products and supporting the local economy, thereby contributing to the growth of the Australia hospitality industry. In October 2022, the independent hotel collection Small Luxury Hotels of the World (SLH) entered a strategic brand partnership with La Vie Hotels and Resorts. This collaboration will enhance La Vie’s tailored management services for independent upper-upscale and luxury boutique hotels, providing global distribution as well as sales and marketing support.

Australia Hospitality Market Regional Insights

The Australia hospitality market varies by region, showcasing distinct trends. In New South Wales, Sydney attracts international tourists with luxury accommodations and diverse dining focused on sustainability. Victoria’s Melbourne emphasizes boutique hotels and local cuisine. Queensland's popular coastal cities, like Brisbane and Gold Coast, see a rise in eco-friendly resorts. In Western Australia, Perth highlights wine tourism and indigenous experiences, while also promoting local seafood. Each region reflects unique characteristics catering to both domestic and international visitors.

As of June 2023, the Australian Trade and Investment Commission reported that 82% of tourism businesses were in New South Wales (116,693), Victoria (109,595), and Queensland (64,432). From June 2022 to June 2023, Western Australia, the ACT, and Queensland experienced growth in tourism businesses, fueling demand of the Australia hospitality market. Increased tourist spending on accommodations, dining, and attractions significantly boosts the local economy, creating jobs and supporting businesses.

Competitive Landscape

The key players in the Australia hospitality market offer stylishly designed rooms, on-site dining options, and excellent event facilities, attracting both leisure and business travellers. Their dedication to exceptional service and meticulous attention to detail enhances the overall guest experience.

Key Industry Players

Crown Resorts Limited: Established in 2007 and headquartered in Melbourne, Australia, it is a premier entertainment and hospitality company. It operates luxury resorts and casinos, offering top-notch dining, accommodation, and entertainment experiences, contributing significantly to the Australian tourism industry.

TOGA Group: Founded in 1963 and based in Sydney, it is a prominent property and hospitality company. Specialising in hotel management and development, it operates various hotels and serviced apartments across Australia, emphasizing innovative design and exceptional guest experiences.

Hemmes Trading Pty Ltd.: Established in 2000 and located in Sydney, it is known for its diverse portfolio of hospitality venues, including restaurants and bars. The company focuses on creating unique atmospheres and quality service, enhancing Australia's vibrant culinary and nightlife scene.

Neddidge : Founded in 2019 and based in Australia, it is a hospitality and tourism company dedicated to providing unique experiences tailored to modern travellers. The company focuses on innovative services that cater to evolving consumer preferences in the competitive hospitality market.

Other key players in the Australia hospitality market report include Berida Hotel, among others.

Recent Developments

August 2024: Ennismore's bohemian lifestyle brand Hyde launched in Australia with the opening of a transformed hotel in Perth's CBD, in partnership with Ark Capital Partners and Kyko Group. Situated on Pier Street, Hyde Perth offered 120 stylish guest rooms, including 18 suites, along with social areas, two event spaces, a restaurant, and a bar leading to a tropical-themed outdoor pool area.

August 2024: Radisson Hotel Group’s upper-midscale Park Inn by Radisson made its debut in Australia with the opening of a Carlton hotel in partnership with Frater Capital Group. Scheduled for the fourth quarter of 2024, the hotel featured 89 guest rooms, a gym, pool, two meeting rooms, and an all-day dining restaurant.