AUSTRALIA. As reported, Heinemann Australia today (16 February) unveiled a spectacular new luxury beauty, fashion and accessories store at Sydney Airport Terminal 1, a key element in the airport’s much-enhanced Luxury Precinct, which features an impressive array of designer boutiques.
Sydney Airport Executive General Manager Commercial Mark Zaouk spoke to Martin Moodie about the Luxury Precinct approach and execution and the wider commercial picture at the Australian gateway.
Red-letter day in SydneySydney Airport and Heinemann Australia are jointly celebrating the opening of the airport’s Luxury Precinct today (16 February) in a spectacular three-part event. The Moodie Davitt Report Founder & Chairman Martin Moodie is on location and providing rolling coverage of the occasion. The Luxury Precinct includes designer An official inauguration and terminal experience is followed by a dinner on the airfield and an after-party at the Ivy Sydney in the Central Business District. |
Mark, tell us about the thinking behind the creation of the luxury space. What were your aspirations and what was the strategy underpinning them?
We set out in 2019 with a goal to create the best luxury travel precinct in the region, based on where we saw travel retail trends heading. We also wanted to take the precinct more upmarket to give passengers something worth arriving early for. Certain aspects of air travel were feeling a bit commoditised pre-COVID, and we wanted to do something that harked back to the golden age of air travel, when the whole experience felt more exclusive.
What kind of statement do you think this makes about Sydney Airport (and Sydney itself) that you were able to attract such a stellar line-up of brands?
Having these brands represented at Australia’s gateway airport shows that we are a true global city. It shows we are a serious player, taken seriously by the biggest luxury brands in the world. That these brands signed up during COVID also gave us a lot of confidence that everything would be OK in the long run.
We always felt that travel would come back and the world would one day return to normal, but it was incredibly comforting to have these brands support that view.
The results look stunning. How happy are you with the ultimate execution? And how are results to date?
The brands have gone above and beyond, and the execution in terms of store formats and concepts is incredible. It also justified our investment in the physical works in the precinct, for example, by raising the height of the roof from four to nearly ten metres.
This created room for larger stores and more exciting formats, and the Louis Vuitton store is an amazing example of this.
Just run us through the offer to date and what’s to come.
Seventeen luxury stores + Heinemann (with their luxury concessions) are open now, with two more to come in mid-2023:
- Open now: Balenciaga, Bottega Veneta, Burberry, Bvlgari, Celine, Dior, Gentle Monster, Gucci, Hermès, Loewe, Louis Vuitton, Moncler, Prada, Rolex, Saint Laurent, Tiffany & Co. and Valentino
- Joining in mid-2023: Cartier and Versace
The timing of the openings seems optimum with the opening of the borders and the resultant rebound in travel. Sydney Airport exceeded 3 million passengers in December for the first time since February 2020 and international traffic was back to 72.1% of December 2019 levels. How is that resurgence translating commercially?
We’re really proud that we stuck to our pre-COVID strategy for the luxury precinct, but it’s true that we’ve been blessed with terrific timing right through this project.
COVID was clearly terrible for our business but from a glass half full perspective we were able to redevelop the precinct faster and with less disruption because we had no passengers. Now that international travel is coming back it’s really rewarding to see these stores coming online, and to see passengers experiencing something completely different to what was here previously.
Flights to and from China are increasingly rapidly since the unexpectedly early reopening of China’s borders, not surprisingly given the big Chinese population in Sydney. It’s early days, I know, but how have you seen the impact in commercial terms so far, particularly in terms of the luxury offer?
It’s probably too early to say but to your earlier question, the timing has been perfect with the re-opening of the luxury precinct coinciding with the re-opening of one of our most important markets.
But it’s also important to note that this precinct isn’t focused on one market; we have a really diverse passenger base and that was a big part of the appeal in terms of the brands wanting a presence here.
What’s next in the pipeline commercially that you can tell us about – right across the commercial revenues sector?
There is definitely more to come and the work doesn’t stop here. Now that we have the physical space right we want to work on the service offering. Things like a concierge service, VIP rooms, personal shopping and exclusive brand experiences.
We’re also examining a food & beverage upgrade, to make sure it represents the world-class culinary scene we have here in Sydney. We’re also focused on our domestic precinct and the project to develop in-terminal department stores with Heinemann.
Finally, the official inauguration has been dubbed “a once in a lifetime event”. How exciting is this for you personally – especially after all the challenges of the past three years?
For the entire team it’s a relief to be at this point, and to be talking about something positive after a few very tough years.
Most importantly it’s a chance for us to say a heartfelt thanks to the brands for their support. We’re grateful to them for their belief in the long-term fundamentals of Sydney Airport and for buying into the aspiration of what we are trying to achieve.
Our duty free partner Heinemann has also been incredible. They’ve been with us all the way on this, and to have a partner who not only buys into your vision, but elevates it, is really rewarding. ✈
