Tourism sector battens down for new hit

After being hit by bushfires, tourism operators are now facing the coronavirus fallout.

Hotelier Jerry Schwartz Picture: Jerad Williams

After being hit hard by the bushfires over summer, regional hotels are starting their slow recovery.

CBD hotels can expect to be heavily affected by the corona­virus, with scores of international conferences tipped to be cancelled.

Hotelier Jerry Schwartz, who owns 15 regional and city hotels on the eastern seaboard, said a major international drug company had just cancelled a conference at his Sofitel Darling Harbour hotel worth $300,000-$400,000.

“Quite a few of the delegates hailed from the central Chinese province of Wuhan, the centre of the virus,” Dr Schwartz said.

“There is a lot of concern from the hotel management companies and from all the hotels which service the Chinese inbound market.

“We believe all the inbound groups from China are looking at cancelling. That’s the main worry.”

Dr Schwartz said he had been hit by the bushfires in the regions including his hotels in Canberra, the Hunter Valley and Blue Mountains. He was now expecting to cop an occupancy downturn in his city properties. “It’s terrible. The regional hotels were affected by bushfires, now my city hotels will be affected by Chinese pulling out because of the coronavirus,” he said.

Dr Schwartz said the tourism sector had this summer experienced the worst crisis since the 2008 global financial crisis. He said his Fairmont Resort in the Blue Mountains normally traded at 90 per cent occupancy at this time of year but was occupied at less than 20 per cent. “The Fairmont has lost money and it is unable to pay its mortgage,” he said.

The bushfire-led “worst summer on record’’ has already wiped $2bn from the nation’s tourism coffers and could inflict a further $4.5bn in lost income.

Estimates of the damage the coronavirus will wreak on tourism operators are still unknown, but China has been Australia’s largest inbound market for past the two years, with 1.45 million visitors annually, up more than 300 per cent on the previous decade.

Chinese people spend $12.3bn a year in Australia, three times Australia’s next most important international tourism market, the US.