Tune enters Australia with caution
Tune Hotels, AirAsia’s property arm, is hopeful its foray into the Australian market will stimulate interest from developers and enable it to spread nationwide.
Tune’s first Australian property in Melbourne will open this time next year with a Sydney property next on the cards. The firm is in talks over a number of opportunities in the NSW capital, with one close to the airport.
Chief executive Mark Lankester highlighted the major obstacle for the hotel firm as the reluctance of developers to commit to hotels which were less lucrative than residential projects.
“We have to take a bit of a long and hard route and do it ourselves,” he told Travel Today.
Lankester is hopeful that if they “get it right” with their first few properties, developers will consider opportunities to work with them down the line.
“We are looking long and hard at the Australian market,” he said. “We need to make sure we have a solid understanding of the hospitality needs.”
Meanwhile, he expected AirAsia X services from Asia would be a reliable source of guests with the brand already present in Thailand, Malaysia, the Philippines and Indonesia.
But he said it was a “myth” that all low cost air passengers would want to stay in a budget hotel. Families would look at serviced apartments, while others who had made savings on airfares would splash out on accommodation.
Adoption of the brand by domestic tourists was also vital to its success, he added.
“We can’t just rely on international tourists,” he said. The firm’s properties in the UK and Asia already had a “significant” Australian segment, which meant there was already brand awareness locally.
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