The only place I know of in Sydney where you can hold a koala is at Featherdale Zoo outside of Sydney on the way to the Blue Mountains. Most zoos do not allow this. Featherdale can easily be reached by car. It's a great little zoo where you can also feed the kangaroos and see other Australian wildlife.
The other was at Paul's Place, a marvelous farm for meeting tame Australian wildlife. Paul's Place is on Kangaroo Island, in the north-center of the island about 30 miles west of the big town of Kingscote.
I don't think it kitchy to want to hold a koala! It's a marvelous introduction to Australian animals. You'd be able to spot the koalas up in trees at places such as Koala Walk, also on Kangaroo Island, and see them munching on eucalyptus in a Sydney zoo, but there's no joy like actually holding one in your arms, and of course being photographed.
I have some really nice photos we took doing that!
My understanding is that no where in New South Wales allows people to actually hold a Koala. In fact it's illegal due to the fact that humans can pass diseases on to the animals, it's stressful for them being passed from person to person and some wildlife parks were known to sedate the animals and cut their claws so short that they then had difficulties climbing trees. Featherdale's website just says you can "get up close and personal" with a Koala and have your photo taken with one
It seems Western Australia hasn't yet moved to pass lawas to outlaw Koala cuddling, so in Perth you can indulge at http://www.cohunu.com.au/ or http://www.marapana.com/ It seems bookings are recommended for koala cuddling.
It's also my understanding that koala "cuddling" is not allowed in NSW. Last time I checked, which admittedly was about a year ago, koala "cuddling" was not allowed in either Taronga Park or Featherdale, where was told that there are photo ops available with a koala, but not holding it. So would be interested to know if this has changed.
Taronga zoo definitely does not allow this. I did see people at Featherdale holding kolas for photos two years ago, but it might have changed since then.
This is what the Australian Koala Foundation has to say about it. The site also lists where you can see koalas.
I had also read that Koala cuddling was out as far as NSW went but then there was a report not long gone where someone posted on doing exactly that in NSW - did make me wonder at the time and certainly if they're sedating them, I'd definitely say just look and then give your dog or Mickey a bigger cuddle when home and just think of a Koala.
You can still do it in Queensland but looks like that's not on the itinerary.
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