Properties that are used for short term tourism purposes are generally examined under the less restrictive tourism policy. Accommodation facilities do not include holiday houses, mixed residential/commercial properties or serviced apartments – such acquisitions would need to be considered under the Urban Land Policy Guidelines.

Accommodation facilities include the following categories:

• designated strata titled hotels;
• hotels and motels;
• time-share schemes;
• integrated Tourism resorts

Designated Strata Titled Hotels

Foreign acquisitions of strata-titled hotel rooms in designated hotels will be permitted without the need for foreign investment approval where each room is subject to a long-term (10 years or more) hotel management agreement. For a hotel to be designated under this category, it must satisfy the following criteria:

• the hotel must provide a full range of in house facilities (i.e., food and beverage services, room service etc) consistent with industry accepted hotel features;
• all the rooms within the hotel must be subject to the hotel management agreement;
  the hotel management agreement must provide that the owners’ rights are restricted to receipt of an income stream, not occupancy. In addition, owners must not have the right to opt out of the management agreement;
• and ownership rights to the common property within the hotel must be held by the hotel manager.

Hotels and Motels

All proposed acquisitions of hotels and motels must be submitted for examination. However, hotel and motel businesses operating (or to be operated) under one title are normally approved (unless considered contrary to the national interest) under the Tourism Sector policy (details available in the Summary of Australia’s Foreign Investment Policy). Other accommodation facilities such as guesthouses, holiday flats, and undesignated strata titled hotels and motels are examined under policy applying to the residential real estate sector.

Time Share Resorts

The acquisition of an interest in a time-share development is generally regarded as the acquisition of an interest in residential property and subject to above-mentioned restrictions.

However, the acquisition of an interest in a time share scheme is exempt from the usual notification requirements where the entitlement of the foreign person and any of that person’s associates is not in aggregate greater than 4 weeks in any year. This exemption only applies in instances where all the accommodation in a given development(s) is part of that time-share scheme. The exemption does not apply in instances where only selected properties in a development are part of a time share scheme – in such instances the usual restrictions relating to foreign purchases of residential property will apply.

Integrated Tourist Resorts

Acquisitions of residential real estate within a resort which has been designated by the Government as an Integrated Tourism Resort (ITR) prior to September 1999 are exempt from the normal foreign investment restrictions applying to foreign acquisitions of residential property and can be on sold to foreigners without approval.

For resorts designated as ITRs from September 1999, the exemption only applies to developed residential property which is subject to a long term (10 years or more) lease to the resort/hotel operator, making the property available for tourist accommodation when not occupied by the owner.

All other property, including vacant land for development, within the ITR would be subject to the normal foreign investment restrictions.
Operators of ITRs are required to report annually to the Board providing details of the ownership of all accommodation within the resorts.
To be considered for designation as an ITR, a tourist development must satisfy the following criteria:

• be a destination tourist development on a contiguous site normally covering a minimum of 50 hectares within well defined boundaries and be planned and constructed by a single developer;
• have an existing core hotel(s) of sufficient size and standard to provide the central focus for the resort and to provide about 20 per cent or more of the ITR’s total accommodation;
  have ‘non-hotel’ accommodation facilities within the boundaries of the resort;
• and have extensive recreational facilities (such as golf courses, tennis courts, swimming pools, walking tracks etc) within the boundaries of the resort.

Developments which are clearly and primarily destination tourism resorts with a residential component may be considered for designation as ITRs. However, developments which are substantially residential in nature, even though they may have a tourism component, would not qualify for designation as ITRs. Generally, it is expected that a destination tourism resort being considered for ITR status will have commercial (including the core hotel) and recreational facilities accounting for about 70-80 per cent of the resort’s area.

Resorts which are still at the planning stage, or at the early stage of development, or do not satisfy all the above criteria are not eligible for designation as an ITR.