Hote­liers on a lu­cra­tive ride

Travel Digest - - NEWS -

Dou­ble-digit growth over the past year in most re­gions – this was the open­ing com­ment at the re­cent New Zealand Ho­tel In­dus­try Con­fer­ence at The Lang­ham Auck­land, by plat­inum spon­sor Ac­corHo­tels se­nior vice pres­i­dent for New Zealand, Pa­cific and Ja­pan, Garth Sim­mons. The com­ment was one other hote­liers, among the 300 del­e­gates present, re­lated to. “Three years ago I at­tended by first con­fer­ence here when the en­vi­ron­ment was down and tough,” said Mr Sim­mons. “We now need to make hay while the sun shines as there is an in­evitable time when the in­dus­try will turn again.” Mr Sim­mons added: “Over the next three years we are fore­cast­ing to re­cruit 10,000 em­ploy­ees in our ho­tels in the Asia Pa­cific re­gion.” Big num­bers were cited through­out the con­fer­ence and this in­cluded ho­tels up for sale. The Syd­ney five-star mar­ket saw $2 bil­lion in trans­ac­tions over the past three years, said Col­liers In­ter­na­tional di­rec­tor ho­tels Asia Pa­cific, Stephen Burt. “Big con­glom­er­ates are buy­ing up all of the ho­tels in Aus­tralia.” In Auck­land he noted the Ritz Car­ton, Park Hy­att and Sof­i­tel So will soon be en­ter­ing the mar­ket, but that other up­scale ho­tels in New Zealand do need to be rein­vig­o­rated. “The losers will be those ho­tels not re­cap­i­tal­ized and not re­fur­bished.” As far as ho­tel de­sign goes, Mr Burt noted all chains were in­tro­duc­ing lifestyle brands. “Ev­ery sin­gle chain world­wide is us­ing the same words to sell their lifestyle brands with de­signs sym­pa­thetic to the lo­cal com­mu­nity. Ex­e­cu­tion of brand prom­ises, how­ever, is go­ing to be based on hav­ing prop­erly-trained staff.” China, he noted, will con­tinue to be the dom­i­nant source of cap­i­tal in this re­gion. “At the mo­ment it is a trickle. Soon it will be a wa­ter­fall.” In the Asia Pa­cific re­gion ho­tel trans­ac­tions reached $7.5 bil­lion last year, ac­cord­ing to Jones Lang LaSalle man­ag­ing di­rec­tor in­vest­ment sales Aus­trala­sia ho­tels and hos­pi­tal­ity Mark Dur­ran. Much of this has been driven by Chi­nese in­vestors like FuWah [who re­cently bought the Park Hy­att Mel­bourne and are cur­rently build­ing the Park Hy­att Auck­land]. The soft cur­rency rel­a­tive to the Chi­nese cur­rency has helped, as has the cor­rup­tion crack-down in China. “In New Zealand there has been very strong in­ter­est in the last 12 months, but there is a lack of in­vest­ment grade stock, with no ho­tels avail­able.” Chi­nese buyer Christo­pher Hur was at the con­fer­ence. His com­pany Host Ho­tels & Re­sorts is the largest ho­tel in­vestor in the US and in the world. As vice pres­i­dent of ac­qui­si­tions and de­vel­op­ment, Mr Hur com­mented on his com­pany’s port­fo­lio of New Zealand ho­tels. The New Zealand mar­ket over the past four years, he said, had con­tin­ued to re­cover and grow. Host Ho­tels, nev­er­the­less is look­ing to divest its port­fo­lio of the Novo­tel and Ibis ho­tels in Eller­slie, but not else­where. “We are not selling our as­sets in Christchurch right now. We are still go­ing to own five of the seven ho­tels in New Zealand and we are al­ways look­ing for op­por­tu­ni­ties.” In­vest­ing in New Zealand, he said, was straight for­ward, with a sta­ble gov­ern­ment, trans­parency and ease of do­ing busi­ness – mak­ing it more at­trac­tive than other mar­kets. Mr Hur added: “New Zealand is a beau­ti­ful coun­try – the clean air, the space, the green­ery – that is why Chi­nese like it down here. The coun­try is very ap­peal­ing and the in­vest­ment re­turns have turned out quite well.” Asked about the stan­dard of ho­tels in New Zealand, Mr Hur said: “To be hon­est, a lot of the prod­ucts are a bit old. The main

Host Ho­tels & Re­sorts vice pres­i­dent of ac­qui­si­tions and de­vel­op­ment Christo­pher Hur, be­ing in­ter­viewed by master of cer­e­monies Na­dine Chalmers- Ross.

ABOVE: As­so­ciate min­is­ter of tourism Paula Ben­nett. RIGHT: Tourism New Zealand chief ex­ec­u­tive Kevin Bowler.

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