One of New Zealand's biggest real estate agencies is betting on a bounceback in the country's decimated tourism industry with its purchase of a major brokerage firm that specialises in selling tourism and hospitality properties and businesses.
The acquisition of the Resort Brokers brand and business by Bayleys was completed during lockdown and is part of the real estate agency's plan to expand into the tourism sector.
The new entity, Bayleys Hotels, Tourism and Leisure, will play a crucial role in the reactivation and revitalisation of the country’s tourism sector, Bayley Corporation managing director Mike Bayley says.
“Tourism is New Zealand’s biggest export industry, contributing more than 20 percent of foreign exchange earnings and while this star has unexpectedly just fallen hard – and fast – the only way now, is up,” says Bayley.
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“Industry analysts have determined that the sector will bounce back to become even more resilient.”
Resort Brokers was founded in Auckland in 2002 by Wayne Keene and Gordon McGregor. Its clients span the motel, hotel, bed and breakfast, lodge, backpacker and holiday park market, with its services including brokering sales, leasing, management rights and market research.
Keene and McGregor, who will remain as national director and director, respectively, say the global spread of the coronavirus has changed the playing field for the tourism sector.
Bayley Corporation managing director Mike Bayley says the tourism industry will emerge from the current crisis more resilient than ever. Photo / Supplied
“More modest accommodation providers could find new traction in the market, as short-term peer-to-peer models such as Airbnb are modified, and potentially many properties removed from the accommodation pool," McGregor says.
“Importantly, business operators will have the opportunity to claw back control of their booking and promotional avenues as online travel agencies relinquish the hold they have had in recent years.”
Bayleys national director commercial Ryan Johnson, says bringing Resort Brokers under the Bayleys umbrella will enable the agency to confidently leverage a national tourism business line throughout New Zealand, with 96 offices across the country mobilised to navigate the new economic environment.
“Historically, the real estate part of the tourism market equation has been highly-fragmented with owners/operators of properties and businesses in this space not having access to a national, full-service agency,” he says.
“The Bayleys-Resort Brokers partnership changes all of that, bringing the tourism property sector into the broader Bayleys business fold where our sales, leasing, valuation, investment advisory, property management and other core business strands will combine to deliver an integrated and specialist response to a sector that is hungry for expertise – particularly now.”
Johnson says the tourism sector is no stranger to disruption, although Covid-19 is a beast that usurps everything that has come before.
“Now is the time for our tourism accommodation and leisure sector to take stock and decide how it will look in the new landscape we all find ourselves in.
“Maybe some existing motel/backpacker stock will become part of the solution for the country’s rental shortage and some owners of accommodation operations located on main arterials in areas facing residential development land constraints may decide that the best and highest use for their property lies outside of the tourist market.”
Johnson says sector change is inevitable, but the opportunity to be part of the market re-set is exciting.
“In the 1980s, our tourism industry slogan was 'don’t leave home ‘til you’ve seen the country' and with international borders sealed for the foreseeable future, domestic tourism will be the foundation block in the sector’s regeneration.
“Yes, there will be constraints on disposable incomes and a recalibration of priorities, but Kiwis love to holiday – and they also have a new appreciation for how a country can band together to achieve great things.
“If the country’s ‘bubble’ can extend trans-Tasman to open Australia and New Zealand’s borders, then we’ll be seeing blue skies in the sector again.”
In a recent webinar, Tourism Minister Kelvin Davis, Tourism New Zealand chief executive Stephen England-Hall and Air New Zealand's Cam Wallace said the industry needed to be rebooted to face new challenges, opportunities and a different way of working.
Government, industry and businesses all need to collaborate to keep the sector on a phased growth trajectory, promoting domestic tourism in the short term and targeting an international offering in due course.
“We have an opportunity to rethink the entire way we approach tourism to ensure that it will make New Zealand a more sustainable place, enrich the lives of all our people and deliver a sector which is financially self-sustaining in the longer term,” said Davis.
Air New Zealand said it would consider using Singapore as its first international base or hub so it can springboard to new destinations, while Tourism Industry Aotearoa is looking at a digital strategy to target Singapore and Australia.
