Australia hospitality market set to nearly double by 2034

By AI, Created 11:55 AM UTC, May 19, 2026, /AGP/ – Australia’s hospitality market is projected to grow from $37.45 billion in 2025 to $70.93 billion by 2034, powered by tourism recovery, higher hotel investment, and faster adoption of AI across hotels and restaurants. The sector is also benefiting from regional travel growth, premium room openings, and government support for tourism and small businesses.

Why it matters: - Australia’s hospitality sector is expanding alongside tourism recovery, digital upgrades, and shifting traveler habits. - The market’s growth is likely to lift demand for hotels, restaurants, event venues, and experience-led travel services across the country. - Stronger investment activity and public support are helping shape the next phase of growth.

What happened: - The Australia hospitality market was valued at $37,454.48 million in 2025. - The market is projected to reach $70,933.81 million by 2034. - The forecast implies a 7.35% compound annual growth rate from 2026 to 2034. - The market includes hotels, resorts, restaurants, event services, and travel-related experiences. - International visitor arrivals are forecast to surpass pre-pandemic levels by 2026-27 and reach a record 10 million. - Hotel transaction volumes reached $2.7 billion in 2025, up 80% from the prior year and 58% above the long-term average. - The Federal Budget 2025-26 set aside a $195.9 million operating budget for Tourism Australia. - The tourism investment pipeline includes 363 projects worth $74.5 billion, up $11.1 billion from the prior year.

The details: - Hotel occupancy across Australia is at 72.6%, while average daily rates have risen to $250.65. - National occupancy is projected to reach 85% to 92% during peak seasons. - Food and beverage venues are adding bowling, darts, trivia technology, and VR experiences to attract repeat visitors and increase spending. - Sustainability is becoming a competitive factor as operators adopt energy-efficient practices, waste reduction, and sustainable sourcing. - Business travel, conferences, exhibitions, and corporate events are supporting occupancy and revenue. - Bleisure travel is extending stays and lifting ancillary spending. - Sixty-seven hotel assets changed hands during the year, with an average deal size of $40 million. - Notable transactions included Ayers Rock Resort, Park Hyatt Melbourne, and a 50% stake in Ritz-Carlton Perth. - Only 7,300 rooms are currently under construction across Australia’s ten major hotel markets. - Openings are expected to peak in 2026. - The report segments the market by accommodation type, service type, business model, price segment, and region. - Key players cited in the report include Accor, Marriott, IHG, Hilton, Hyatt, Crown Resorts, EVT, TOGA Group, Quest Apartment Hotels, and Choice Hotels Asia-Pacific. - The report includes a sample request page at Request the sample report and the full report at Browse the full report.

Between the lines: - The market is shifting away from standardized lodging and toward personalized, experience-driven travel. - Boutique hotels, wellness offerings, and regional destinations are gaining share as travelers look for more authentic stays. - Supply constraints are supporting pricing power, especially in accommodation markets with limited room growth. - AI is moving from a back-office tool to a core operating layer for bookings, staffing, guest service, and marketing. - Adoption is still uneven: 42% of small to medium hospitality businesses are already using AI, while 89% of hoteliers plan to add new AI applications. - Even with broad travel use, only 2% of guests are allowing autonomous booking, which suggests AI is augmenting human decisions rather than replacing them.

What’s next: - International arrivals are expected to fully exceed pre-pandemic levels by 2026-27. - Premium hotel openings in regional markets are set to add inventory in 2026. - More operators are likely to expand AI use for personalization, revenue management, and customer support. - Investment activity may stay elevated if demand holds and room supply remains tight.

The bottom line: - Australia’s hospitality market is entering a growth phase powered by tourism rebound, record investment, and a rapid shift toward premium, digital, and experience-led services.