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Schwartz: Govt’s need to support regional tourism


In an exclusive outlook column for HM, Australia’s leading hotel investor Jerry Schwartz says Governments of all levels need to act and start supporting regional tourism.

Last year, 2014 was a great year for the Schwartz Family Company (SFC), and for the hotel industry more generally, and I believe that these events have set the tone for 2015 and beyond.

Little did I realise that when I was dealing with Lend Lease, negotiating to get some pylons from the demolition of the Sydney Convention Centre for my new conference centre in the Hunter Valley, that I would be dealing with them further as the successful investor of the new ICC hotel at Sydney’s Darling Harbour.

‘Winning’ the bid didn’t come cheaply, as the hotel will cost a third of a billion dollars, but such is my belief in the potential of the Sydney hotel industry that I believed the investment was justified, even if it meant that I had to sell down my remaining non-hotel assets and the Holiday Inn at Sydney Airport.

Sydney Airport has transformed remarkably since SFC purchased the Holiday Inn. Almost in front of the hotel a new Adina hotel is being constructed, and it is encouraging to see the new partnership between Toga and Far East because it will fuel greater development in the Australian hotel industry.
It is also encouraging to see IHG’s new commitment to be a force in the Australian hotel industry, as has been demonstrated by their substantial investment in their new headquarters in Bond Street in Sydney.

The level of activity in the Australian hotel industry is to be welcomed, just as I am thrilled that the Australian hotel sector has finally decided to get serious and establish a single voice for the industry. The decision of TAA and AAoA to amalgamate is long overdue.

As a private investor in the Australian tourism industry I have put substantial amounts of money on the line to grow our tourism industry, and we have desperately needed a strong hotel representative organisation to support such investments by providing strong advocacy to Government.

For instance, we have just opened the Hunter Valley Conference and Events Centre, which SFC financed itself, that will benefit all tourism operators in the Hunter Valley. We all know that other industries such as mining are declining, whereas tourism has the potential to create both strong revenue flows and jobs – so now it is time for Government to support with regional infrastructure development, and it is up to the new hotel association to ensure this happens.

However, that shouldn’t stop all regional operators having a strong voice as well. There is a State election in NSW in March, so this is the time for hotel operators to demand action from their local members to ensure more money is allocated to assist regional tourism.

The Government must create reasons for people to rediscover regional Australia, whether it be by supporting events, making it easier for travellers to reach their destination, or supporting the establishment of major venues. Such investments will benefit all hotels because if there is something to do in a destination, then the visitor will need somewhere to stay.

There are some great examples of regions with far-sighted local and State governments creating reasons for individuals and groups to visit, and that then attracts the MICE market, which can provide a massive stimulus to the local economy.

As I said last year, I am a fervent believer in using profits to continually upgrade the guest experience. The reaction to refurbishments of hotels such as Fairmont, Rydges Sydney Central and World Square, the Mercure hotels at Central and in Canberra, as well as the Victoria Hotel in Melbourne, has been outstanding, which only goes to highlight my view that you get out what you put in.

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